Calculate how much disability insurance you may want to protect your income.
Auto-updated · Verified daily against IRS, Fed & Treasury sources
Enter your numbers below
Based on your inputs
Reality Score:save 3 numbers across housing, debt & cash to see how your full picture holds up (0–100). One calc alone can't tell you that.
Stays in your browser. Never sent to us.
Analyze 3+ calcs to unlock your Financial Picture dashboard (cross-analysis of all your numbers).
You probably have health insurance. You might have life insurance. But do you have disability insurance?
Most people don't. And most people also don't think they'll become disabled.
Here's the uncomfortable truth: A serious accident or illness can happen to anyone, at any age. And if it does, you'll need income to cover your mortgage, food, healthcare, and bills while you recover.
According to the Council for Disability Awareness:
These aren't rare edge cases. They're statistical likelihoods that affect millions of regular people.
Let's walk through a realistic scenario.
You: 42 years old, earning $80,000/year ($6,667/month), healthy, no disability coverage.
Then: A car accident. Back injury. Spinal fusion surgery. Recovery takes 6 months. You can't work.
Month 1–6: No income coming in.**
If you have an emergency fund, great — it covers this. But most Americans have less than $1,000 in emergency savings. You'd need to:
A 6-month disability without insurance could cost you $50,000–$100,000+ in debt, penalties, and disruption.
If disability is statistically common and financially catastrophic, why don't more people have insurance?
"That won't happen to me." It's human nature to underestimate our own risk. We see disability as something that happens to"other people."
Many employers offer disability insurance as a benefit. People assume,"I'm covered." But employer plans typically:
"Insurance is expensive." True for bad insurance, false for good disability insurance. A quality long-term disability policy costs 1–3% of income. An $100K earner pays $1,000–$3,000/year. That's about $80–$250/month. For income protection? Cheap.
Disability insurance is genuinely complicated. Own-occupation vs any-occupation definitions? Elimination periods? Benefit periods? People avoid it because they don't understand it.
We'll simplify this below.
Disability insurance replaces income if you become unable to work due to injury or illness.
1. Elimination Period (Waiting Period)
After you're disabled, how long before benefits start?
Longer elimination periods = lower premiums. If you have 6 months of savings, a 180-day elimination period is fine. If you have little savings, go 30–90 days.
2. Benefit Amount
How much of your income does it replace?
3. Benefit Period
How long does the insurance pay out?
This is the most important choice. A 2-year benefit covers car accidents and short-term illnesses. But cancer, back injuries, or mental health issues can last 5–10+ years. For maximum security, buy"to age 65."
4. Own-Occupation vs Any-Occupation Definition
This is technical but critical.
Always choose own-occupation if you can afford it.** It's much easier to claim benefits.
Most people get some disability coverage through work. But it's rarely enough.
Example: You earn $100,000/year ($8,333/month). Your employer plan pays 60% = $5,000/month. But that's taxed as income (let's say 20% tax) = $4,000/month after tax. You've lost $8,333 → receiving $4,000. You still need $4,333/month.
You buy an individual policy (usually 40% of income) to fill the gap.
Combined:**
You're now protected. Employer alone wasn't enough; supplemental filled the gap.
If your employer offers no disability insurance or only short-term (3–6 months), individual long-term insurance is essential.
High earners often hit the benefit cap of an employer plan. A $200,000 earner with a $5,000/month cap replacement is severely underinsured. Individual policies for high earners (often called"executive disability" insurance) are worth buying.
No employer plan. You may want to buy individual insurance. If you can't work, who pays the bills?
Construction, healthcare, physical trades — your risk of disability is above average. Supplemental insurance is wise.
Disability insurance is cheapest when you're young and healthy. A 30-year-old pays roughly 50% less for the same policy than a 50-year-old. If you're going to buy, buy now.
Use our Disability Insurance Calculator to run the numbers, but here's the framework:
How much do you absolutely need to survive if you couldn't work?
Everything else (dining out, entertainment, vacations) is luxury. Calculate the bare minimum. Likely $3,000–$5,000/month for most people.
What does your employer provide (if anything)? Multiply your salary by their replacement percentage (usually 60%), then apply taxes (20–30%).
That's your employer baseline.
Essential expenses - (employer baseline after-tax) = gap you need to cover.
Example: $5,000/month essential, $3,000/month from employer = $2,000/month gap.
You need individual disability insurance for at least $2,000/month benefit (potentially more as buffer).
Elimination period: How long can you survive without income? If you have 6 months of savings, 180-day elimination is fine. If not, 30–90 days.
Benefit duration: Buy"to age 65" if you can afford it. If not, minimum 5 years (covers most scenarios).
Individual long-term disability insurance for a healthy 40-year-old, $100K income, 90-day elimination, to-age-65 benefit:
Yes, really. Less than a Netflix subscription. And it protects your entire livelihood.
Factors that raise the cost:
Best time: Age 25–35
Healthy, affordable premiums, decades of coverage ahead.
Acceptable time: Age 35–45
Still reasonable rates, some time before disability risk rises significantly.
Harder, but doable: Age 45–55
Costs rise, pre-existing conditions matter more, but still available.
Risky: Age 55+
Premiums are high, qualifying is harder, availability is limited. If you reach 55 without disability insurance, you're exposed.
Disability insurance isn't glamorous. Nobody celebrates"yay, I bought insurance!" But it's one of the most valuable financial decisions you can make. A 3-month disability without insurance could cost $50,000+. A $1,500/year policy preventing that? Best investment you'll make.
You can still buy disability insurance, but it may be more expensive or have exclusions. Some insurers specialize in high-risk clients. Shop with 3–4 companies — underwriting varies. Don't assume you're uninsurable.
Yes. Depression, anxiety, PTSD, and burnout are covered if they prevent you from working. Mental health disabilities account for ~8% of all claims and are increasingly common. Make sure your policy covers them (most do).
Once your policy is active, you're covered. Pre-existing condition exclusions (if any) are limited to 12 months typically. After that, even a pre-existing condition is covered. This is why buying young and healthy matters — you lock in coverage before risk hits.
Coverage window: 3–6 months typically
Who it covers: Employees recovering from surgery, temporary illness, or acute injury (broken leg, appendicitis, simple back strain)
Income replacement: 50–70% of salary, paid weekly or bi-weekly
Waiting period: Usually 1–14 days (benefits start almost immediately)
Who pays: Usually the employer (no cost to you)
Common claim duration: 4–12 weeks
Example: You have knee surgery. You're out of work for 6 weeks. Your short-term disability kicks in after 3 days, replacing 60% of your salary. You receive ~$2,000/week (if you earn $100K). After 6 weeks, you return to work. Claim ends. You're back.
Coverage window: 2–5 years, or to age 65 (or 67)
Who it covers: Employees unable to work for extended periods due to serious injury or chronic illness (spinal cord injury, cancer undergoing chemo, severe depression, multiple sclerosis)
Income replacement: 60–70% of salary, paid monthly
Waiting period (elimination period): 90–180 days typically (bridges from short-term ending)
Who pays: Usually split (employer and employee), or purchased individually
Common claim duration: 18+ months (sometimes permanent until retirement age)
Example: You're diagnosed with cancer. You're undergoing chemotherapy for 14 months and unable to work. Your short-term disability covers the first 3 months. Then your long-term disability kicks in (after the 90-day elimination period) and covers months 3–14 at 60% salary. You receive $4,000/month (60% of $100K annual salary). After recovery, you return to work. Claim ends. Total received: ~$44,000 over 14 months, preventing bankruptcy.
Think of short-term and long-term disability as two safety nets. Let's map it out.
Timeline: You become disabled on January 1
If you have both STD and LTD: You're covered for 3 months + potentially years. Good scenario.
If you have only STD: You're covered for 3 months. Then the cliff. You fall off coverage. Bad scenario.
If you have only LTD: You're covered starting day 91, but uncovered for the first 90 days (unless you have savings). Medium scenario.
Ideal setup: Both STD and LTD with minimal gap between them.
Here's the brutal reality: Most disabilities last longer than short-term coverage.
According to the Council for Disability Awareness, the average disability claim lasts 34.6 weeks — that's 8.7 months. Most short-term policies cover 3–6 months (12–26 weeks). You're already outside the window.
Extremely common disability cause (28% of all claims).
Total time away from work or working limited duty: 6–12+ months.
A 6-month short-term policy covers weeks 1–26. You're partially covered and partially not. Then weeks 27+ onward, you're uncovered (unless you have LTD). That's when your savings run out, credit cards max, and the financial stress begins.
Total time off: 12–24+ months.
A 6-month short-term policy covers months 1–6. Months 7–24, you're exposed. Without long-term disability, you'd lose income for 18 months. Even at 50% income reduction, that's $50,000–$100,000+ in lost earnings (depending on your salary).
Long-term disability was made for these scenarios. It covers months 7–24 (after short-term ends). It's the difference between recovery and financial ruin.
Here's the frustration: Many employers offer short-term disability but not long-term.
Typical employer benefits structure:
This leaves a dangerous gap: You're protected for 3–6 months, but then you're on your own.
Solution: Buy individual long-term disability insurance.
It's affordable ($80–$200/month depending on your age and income) and essential. It bridges the gap after short-term ends and covers the catastrophic scenarios (serious illness, chronic injury) where you're disabled for 12+ months.
Short-term disability alone is sufficient only if:
Even then, it's risky. A single bad accident or diagnosis (cancer diagnosis doesn't care about your age) can devastate you.
LTD is essential if you have:
If any of these apply to you (and they likely do), long-term disability is not optional — it's essential.
Cost to you: Usually free (employer-paid)
Coverage:** 60–70% of salary for 3–6 months
Value per month of disability:** High (you're fully covered)
Cost to you: $50–$200/month depending on age and income
Coverage:** 60–70% of salary for 12+ months (or to age 65)
Value per month of disability:** Moderate (expensive premiums, but covers long-term)
Cost to you: $0 (STD) + $80–$150 (LTD) = ~$80–$150/month
Coverage:** 60–70% of salary for 3 months + 12+ months after = Essentially indefinite coverage
Peace of mind:** Very high (covered for most disability scenarios)
You earn $100,000/year. A quality individual LTD policy costs ~$150/month ($1,800/year). Is it worth it?
If you have a 1-year disability without LTD coverage:
With LTD coverage:
If you're disabled, LTD paid for itself thousands of times over. If you're never disabled (statistically, 75% chance you won't have a 90+ day disability in your working life), you paid $1,800/year for insurance you didn't use.
That's how insurance works. You pay a small cost to protect against a large risk. It's one of the few"bets" where the payoff is worth the premium.
Check your employee benefits document. Do you have STD? LTD? If so, how much and how long?
Our Disability Insurance Calculator shows how much coverage you need based on your income and expenses.
If employer coverage is insufficient (or doesn't exist), buy individual coverage.
Contact 2–3 insurers (Guardian, Principal, The Standard, Mass Mutual). Ask for:
Simple medical exam (bloodwork), questions about health history. Usually approved within 2–4 weeks.
As income grows, increase coverage. You want coverage that grows with your income.
The time to buy disability insurance is when you're healthy and employed. Once you're sick or unemployed, it's too late. Buy today, protect tomorrow.
Yes, especially. Part-time workers often have no employer benefits. Individual disability insurance is critical. You can buy policies that cover your part-time income specifically.
Usually not. Your policies are designed to coordinate: STD ends, LTD begins. But some employers allow"stacking" where both pay simultaneously (rare). Check your policies. If stacking is allowed, you might receive more than 100% income replacement (which is capped, but check your details).
Employer-provided coverage ends. Individual policies are portable — they move with you. This is another reason to buy individual coverage: you own it, it's yours, you never lose it (as long as you pay premiums).
Many people ask:"How much disability insurance should I buy?"
The typical answer:"60–70% of your income."
This is a rule of thumb, but it's incomplete. It doesn't account for your specific situation: expenses, family obligations, existing savings, employer coverage, or risk tolerance.
A better approach: Start with your actual needs, then work backward to the insurance amount.
Step 1: Calculate Your Essential Monthly Expenses**
If you became disabled tomorrow and couldn't work for 12 months, what would you absolutely need to spend?
List:
DO NOT include:
Example calculation:
| Housing (mortgage/rent) | $1,500 |
| Utilities and internet | $200 |
| Groceries | $500 |
| Health insurance (employer portion) | $300 |
| Auto payment and insurance | $400 |
| Minimum healthcare costs | $150 |
| Child care (if applicable) | $600 |
| Minimum debt payments | $200 |
| Total Essential: | $3,850/month |
This person absolutely needs $3,850/month if disabled.
Step 2: Account for Employer Disability Coverage
What does your employer provide (if anything)?
Example: Employer provides 60% of salary. You earn $8,333/month gross.
But wait — individual disability insurance benefits are usually tax-free (you paid premiums with after-tax dollars). So let's adjust:
In this case, the employer coverage alone meets your essential expenses. You might not need individual coverage.
But wait — that's assuming your employer coverage continues. What if you change jobs or get laid off? This is why supplemental individual coverage is valuable, even if employer coverage seems sufficient.
Step 3: Calculate Your Gap
Gap = Essential Expenses - Employer Coverage (after-tax)
Example 1 (No gap):**
Example 2 (Significant gap):**
Step 4: Add a Buffer (Safety Margin)
You've calculated essential expenses, but disability often brings extra costs: Add 10–20% buffer to your essential number. Example: Step 5: Cross-Check Against Income Percentage**
Your final target should be 60–70% of gross income. Example (from above): This is slightly below the 60–70% rule of thumb, but it matches your actual needs. It's fine. (If it's above 70%, you're likely over-insuring or your expenses are very high.) Your essential expenses: ~$2,000–$2,500/month (rent, food, utilities, healthcare) Employer disability coverage (if available):** Likely covers this Your individual policy need:** $500–$1,000/month supplemental (for job portability and peace of mind) As income percentage:** 40–50% of gross income (lower than average, because you have few obligations) Insurance cost:** ~$30–$60/month Your essential expenses: ~$5,000–$6,000/month (mortgage $1,500, childcare $600, food $600, utilities $300, insurance $400, minimum debt $200, healthcare $200, etc.) Employer disability (if available):** Covers 60% of your income. If you earn $10,000/month, that's $6,000 gross ($4,800 after tax). Close to your essential but not comfortable. Your individual policy need:** $1,500–$2,000/month supplemental (fills the gap, covers buffer, ensures family stability) As income percentage:** 60–70% of gross income (higher because you have dependents and fixed obligations) Insurance cost:** ~$100–$150/month (worth every penny given the responsibility) Your essential expenses: ~$7,000–$8,000/month (housing $2,000, childcare $1,000, insurance $600, healthcare $500, debt $800, food $700, etc.) Employer disability:** None (self-employed) Your individual policy need:** $5,000–$6,000/month (60–70% of income)
As income percentage:** 60–70% of gross income (maximum standard) Insurance cost:** ~$150–$300/month (you're self-insuring against your own lost business income) Why is 60–70% the standard target? Insurance companies want to preserve your incentive to return to work. If disability pays 100% of your salary, you have zero financial motivation to recover and go back. So they cap replacement at 60–70%, which means: 50% is often insufficient for living expenses. You need at least 60–70% to cover essentials without depleting savings or running up debt. The sweet spot: 60–70% covers essential expenses with a modest buffer while preserving return-to-work incentive. You can't buy unlimited disability insurance. Insurers have limits based on your income. Typical policy limits: Some policies have"indexed" benefits that grow with inflation, others are fixed. Indexed is better but costs more. Employer provides: 60% of salary (STD, 3–6 months) You buy individually: 40% of salary (LTD, to age 65) Combined: ~100% replacement (minus the coordination, so realistically 90–95%) This is the typical strategy for a fully insured employee: employer handles short-term, you handle long-term gap. Your disability insurance should grow with your income. Review annually: Example: You earned $80K when you bought coverage at 60% = $4,000/month benefit. Now you earn $100K. Your coverage is now only 48% of income. Consider increase to $6,000/month (60% of new income). If any of these apply, review your coverage now. Use our Disability Insurance Calculator to plug in: The calculator will output your recommended coverage amount. That's your target. Then get quotes for that amount. Compare own-occupation vs any-occupation. Compare 90-day vs 180-day elimination periods. Choose the best combination of cost and coverage. Your disability insurance isn't set-it-and-forget-it. It's a critical part of your financial plan that should evolve with your life. Some insurers will sell you more (especially high-earners with caps), but you'll pay significantly more. Recommendation: stick to 60–70% for cost efficiency. Combine with your emergency fund and employer coverage to get comfortable. You can usually insure both (with proof of income via tax returns or 1099s). Some people have a"primary job" policy covering W2 income, plus a"business overhead" or"supplemental" policy covering side income. Calculate both, then insure to target replacement. If you have 6+ months of savings and your employer offers some short-term coverage, a 90–180 day elimination period is fine. If you have <3 months of savings and no employer coverage, go 30–60 days (costs more, but you need faster payouts).
Specific Scenarios: How Much to Buy
Scenario 1: Single, No Dependents, No Debt
Scenario 2: Married, One Income, Kids, Mortgage
Scenario 3: Self-Employed, High Income, No Employer Plan
The Income Percentage Rule: 60–70%
Why Not 100%?
Why Not 50%?
Maximum Insurability: What Insurers Will Sell You
Combining Employer + Individual Coverage
Annual Review: Keep Coverage in Sync With Income
Red Flags: You're Likely Underinsured If...
The Final Number: Create Your Own Recommendation
Can I buy more than 70% income replacement?
What if I have two jobs or side income?
How do I know if my elimination period is correct?
Target 60-70% of pre-disability income. Group employer coverage often covers 60%. If not enough, buy individual supplemental policy.
Short-term: covers 3-6 months, replaces 60-70% income. Long-term: kicks in after short-term ends, can cover until age 65. Both are important.
1-3% of annual income per year for individual long-term disability. A $100K earner pays $1,000-$3,000/year. Worth every penny.
"Own occupation" definition: you can't do your specific job. "Any occupation" (cheaper): you can't do any job at all. Always buy own-occupation coverage if you can.
Employer coverage is usually 60% of salary, taxable. Individual coverage is tax-free. Often supplemental coverage makes sense to fill the gap.
The elimination period is the waiting time before benefits begin, typically 30 to 180 days. Longer elimination periods reduce premiums. A 90-day elimination period is the most common choice, balancing cost and coverage timing.
Benefits from individually purchased disability insurance are tax-free. Employer-paid group disability benefits are taxable as ordinary income. This distinction means a 60 percent employer-paid benefit effectively replaces only 40 to 45 percent of income after taxes.
Approximately one in four workers will experience a disability lasting 90 days or longer before reaching age 65. Disability is far more common than most people expect, making coverage essential for income protection.
Yes. Self-employed individuals can purchase individual disability policies. Premiums are based on income, occupation, health, and age. Business overhead expense policies can also cover fixed business costs during a disability.
A COLA rider increases your monthly benefit annually, typically 3 to 6 percent, to keep pace with inflation during a long-term disability. Without COLA, a $5,000 monthly benefit loses significant purchasing power over a 10 to 20 year claim.
Target coverage = Gross monthly income × 60-70%. Coverage gap = Target - existing employer/group benefit - SSDI estimate. Long-term disability insurance should cover the gap.
Every formula on this page traces to a federal agency, central bank, or peer-reviewed institution. We cite the rule-makers, not secondhand blogs.
Found an error in a formula or source? Report it →
Result: Monthly premium: ~$110–$180 (1–2% of income) depending on occupation class and rider mix.
Council for Disability Awareness: ~25% of workers face a disability of 90+ days before age 67. Own-occupation, non-cancelable, inflation-rider policies cost more but pay meaningfully better.
Result: Income replacement: only ~28%. Gap: $3,963/mo.
SSA 2024 data. SSDI approval takes 3–5 months initial; appeals often 1–2 years. Strict definition of disability (unable to perform any substantial gainful activity).
Group LTD (a) caps at 60% often with a $5–$10k/mo cap, (b) is taxable if employer-paid, (c) ends at job termination. Supplement with a portable individual policy, especially for high-earners whose income exceeds group caps.
Impact: High earner with $20k/mo salary capped at $10k/mo = 50% replacement, not 60%.
Own-occupation pays if you can't do your specific job. Any-occupation only pays if you can't do any work. For specialists (surgeons, dentists, attorneys), own-occupation is dramatically more valuable — and worth the 20–40% higher premium.
Impact: Surgeon with hand injury: own-occ pays, any-occ often denies.
Longer waiting periods (180 vs 90 days) drop premiums 15–25%. Pair with a 6-month emergency fund to bridge the gap. Benefit period should extend to retirement age (65 or 67), not 2–5 years.
Impact: Short benefit period (5 years) leaves you unprotected for long-term disabilities.
State-specific rates, taxes, and cost-of-living adjustments
Calculations are for educational purposes only. Consult a qualified financial advisor for personalized advice.