Long term disability?

[gogreengowhite]

If you have purchased a LTD policy what percentage of your income do you have covered?

We are currently in the process of buying and our friend (who is the insurance rep) quoted 100% of my DH's income. I thought that was overkill, but maybe I'm wrong.

[sh10]

We have 60% coverage, but since we pay the premium with post tax money, any payout is not taxed. 100% coverage seems excessive.

[mrs.spunky]

I don't have a policy, personally, but as an agent, the recommendations are usually between 60 and 85%, depending on the income that would need to be replaced. If your income is $500k and you need to replace $200k to be in the black every month, then it will be lower than if you make $100k and need $80k to pay your bills. The theory is you wouldn't be saving for retirement and eventually you may qualify for SSDI and Medicare.

[makingithappen]

The only option at my work is 66%. It is tax free though.

[Deleted]

Lurker here who happens to work in the life insurance industry. . I think the agent you're working with probably went over this with you, but you should buy enough coverage to replace how much of your spouse's income that you rely on each month.

For example, if you bring home $4k per month, and he brings home $5k, and you spend $8K, just replacing 60% of his income is going to leave you $1K in the hole each month.

But, if you only spend half of your take home pay and you both earn about the same, then you don't need to replace 100% of his income. Just do a budget pretending your SO is disabled and can't work, figure out how much of a defecit that creates in your budget, and purchase that much coverage.

Sorry for the long reply but I've just seen examples of how people could have been in financial ruin if it weren't for their life/disability/long term care policies.