Here’s a conundrum. Many people live paycheck-to-paycheck. Because of this, they depend on their paycheck and need to protect it – but they also don’t have a lot of money to spare on paycheck protection.
It’s the paycheck-to-paycheck paradox, and it can be a real headscratcher – but there are solutions.
Most Americans Depend on their Paycheck
According to Career Builder, 78 percent of U.S. workers live paycheck to paycheck. Even among people earning more than $100,000, close to 10 percent live paycheck to paycheck.
Survey after survey has found that many Americans lack substantial emergency savings. They can get by as long as they keep bringing in an income, but if their salary stops, they’re going to be in trouble quickly.
The Need for Disability Insurance
An injury or illness can put someone out of work. Given this risk, disability insurance makes sense for anyone who depends on a paycheck. So why don’t more people have coverage?
There are a lot of possible reasons.
Some people might not have given it any thought. Until someone points out the need for disability insurance, some people might not even realize that coverage is an option.
Some people might think they’ll be able to depend on Social Security Disability Benefits – a possibly dangerous assumption considering the high rate of rejection and the slow processing time.
But for a lot of people, it comes down to cost. People don’t purchase paycheck protection because they don’t think they can afford it. They’re living paycheck to paycheck, so they don’t have a lot of money to spare. Of course, this is also exactly why they can’t afford NOT to purchase paycheck protection. It’s the paycheck protection paradox.
How to Preempt Price Objections
When presenting disability insurance quotes, some financial advisors make the mistake of adding on too many bells and whistles. Yes, premium riders can be very beneficial – but not if they raise the price so much that the entire policy is rejected by the prospect.
Some paycheck protection is better than no paycheck protection, and if that’s all your prospects can afford, that’s what you should offer.
Our Unit Sales Method makes it easy to adjust your proposals on the fly. It allows you to determine a “unit” cost for each client. Then, with some quick multiplication, you can present your client with three quote options. Instead of asking the client to say YES or NO to your proposal – you ask if they would like option 1, 2 or 3. Download Sales Strategy Quick Tip #3 for detailed Unit Sales Method instructions.
