Northwestern Mutual

Protect Your Ability to Save for Retirement

Manage three key risks that can impact your future.

One of the most important considerations when planning for retirement is to protect yourself—and your ability to save—against things that are beyond your control, such as getting sick or injured. Or, in the worst case, dying too soon. These are not the kinds of things you probably want to think about, but managing risk is one of the most important steps you can take as you plan for retirement.

What's involved in managing risk? There are three key risks to your ability to save for retirement: disability, a long-term care event, and death.

  • 1 in 4 employees will be disabled 3 or more months during thier careers
    Even a relatively short disability could have a significant impact on your ability to meet both short-term saving and long-term retirement income goals. If disability insurance is offered through your employer, take advantage of the opportunity and the group rate that may be offered. But most group plans have some sort of cap—usually about 60 percent of your income—which means you'd be taking a 40 percent cut in pay. Plus, because group disability is employer paid, the benefit may also be taxable. So to fully protect yourself, you may want to consider a supplemental individual policy.

  • Long-Term Care Event:
    If you or a loved one should develop a chronic illness or disabling condition, long-term care services can help you get through your daily routines. Long-term care services are often provided in the home, but long-term care can also be provided in an assisted living facility or a nursing home. And you might be surprised to learn that extended long-term care is not covered by Medicare, Medicaid or health insurance plans. By planning now for long-term care, you'll be taking a critical step toward protecting your retirement income.

  • Death:
    Life insurance helps to ensure your family is taken care of after you're gone. Both term and permanent life insurance provide benefits to your loved ones—to pay bills or take care of other financial obligations in the event of your death. As an added benefit, permanent life insurance also builds equity—or cash value1—that grows tax deferred and becomes a source of funding you can utilize at any age for any reason, including as a source of retirement income.

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