CHICAGO, IL--(Marketwired - May 15, 2014) -
- More than 70 percent of Americans 80+ have some form of disability
- Wills and powers of attorney critical components of an effective financial and estate plan
- Unemployment rate for those with a disability is 41 percent higher than for those without
According to a report issued today by the BMO Wealth Institute, a financial plan can play a pivotal role in easing financial stress for the 56.7 million Americans who have a disability. The report also noted that, as the population ages, the percentage of Americans who will become disabled will rise. Currently 70.5 percent of Americans 80 years old or older identify themselves as having some form of disability, with hearing loss, mobility issues and memory loss being among the most prevalent.*
"Given that the chances of someone becoming disabled increase as one gets older, it's important that individuals are aware of the potential challenges they can face," said Stephen Williams, Vice President, U.S. Financial Planning Strategy, BMO Private Bank. "Specifically, Americans should understand how disability can affect one's personal and financial situation. Planning for the possibility of a disability should be a consideration in any financial plan to help safeguard individuals and their families from the unexpected."
Mr. Williams noted that few Americans have factored in the financial repercussions that can arise from having a disability or caring for a family member who becomes disabled. The combination of reduced income and increased spending to cope with a disability can derail a financial plan. For example, a plan on track to last until at least the age of 90 could see all savings exhausted by the age of 77.
The report stressed that both individuals living with a disability and those caring for them need to manage their financial well-being. To get the most financial benefit, one needs a well-constructed financial plan that uses a variety of tools. The report highlights that having a Will and effective Powers of Attorney are two critical components of a financial and estate plan that, when used properly, can improve the financial situation of those dealing with disabilities.
Disability in the Workplace
The BMO Wealth Institute report also found that Americans believe employers have an important social and legal responsibility to accommodate people with disabilities. The report noted that unemployment rates are higher for those with disabilities (13.4 percent), compared to those without (7.9 percent). The major barriers to employing persons with a disability are lack of education or training, lack of transportation to the workplace and the physical environment of the workplace.**
"Providing equal opportunities to individuals with a disability should be a top priority for employers," said Mr. Williams. "As well, the longer an individual has to deal with a disability, the more pronounced the impact will be on their ability to work and earn an income, which can prevent them from being able to afford the care they need. Employers need to be sensitive to the unique requirements that can come with employees who have a disability and strive to make their workplaces more accommodating and understanding of their needs."
The report can be accessed at: https://www.bmoharris.com/financialadvisors/resources/bmo-wealth-institute.
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*United States Census Bureau, Americans with Disabilities: 2010
**Bureau of Labour Statistics News Release, Persons with a Disability: Barriers to Employment, Types of Assistance, and Other Labor-Related Issues - 2012
About the BMO Wealth Institute
The BMO Wealth Institute provides insights and strategies around wealth planning and financial decisions. The Institute's team of professionals have deep expertise around all aspects of wealth planning including retirement, estate, tax and insurance.
About BMO Private Bank, a Part of BMO Financial Group
BMO Private Bank offers a comprehensive range of wealth management services that include investment advisory, trust, banking and financial planning to meet the financial needs of high net worth clients. Through integrated teams of experienced financial professionals, BMO Private Bank helps its clients realize their financial and lifestyle goals with solutions that are custom tailored and delivered with the highest level of personalized service.
BMO Private Bank is a brand name used in the United States by BMO Harris Bank N.A. Member FDIC. Not all products and services are available in every state and/or location.