A majority of single Americans would suffer a financial hardship if they were forced to stop working for six weeks or more, The Hartford announced on Monday.
The report, The Hartford Benefits For Tomorrow Study, found 87% of single workers would have to make lifestyle changes to cover their expenses if they had to stop working for three to six months. Just 44% of single workers have disability insurance.
More than a third of single workers said they would live off their savings if they couldn’t work for six weeks or more, 23% said they would withdraw from their 401(k).
Mike Fish, vice president of voluntary benefits for The Hartford, noted those plans could put single workers’ retirement at risk.
“Because they are likely to dip into their retirement accounts, the singles without paycheck protection are not only putting their current financial situation at risk but their golden years as well,” Fish said in a statement.
In addition to living off savings and dipping into retirement accounts, 8% of single workers said they would depend on credit cards or loans to get by. Five percent would turn to their friends and family for a loan, and 4% would move in with a family member.
“When you consider that singles make up about half of the U.S. population, that means a significant number of Americans are risking financial hardship by going without paycheck protection,” Fish said. “Disability insurance obtained through the workplace costs on average about a dollar a day. That means for about the cost of a cup of coffee a day, workers can protect their finances and their independence from the impacts of a health issue.”
Over half of Americans have short-term disability insurance, according to the survey, up from 49% last year. However, 45% of respondents overestimated the cost of short-term disability insurance. Another 45% couldn’t even offer a guess as to the cost. The number of workers with long-term disability insurance remained steady at 44%.
The Hartford commissioned BuzzBack to conduct the survey in March 2012. The survey was conducted online among 1,000 full-time workers between 18 and 64.