Long-Term Disability Benefit Shortfall Calculator

Quickly see whether long-term disability benefits keep up with your core bills. Enter your protected salary, the policy's replacement percentage, and essential expenses to estimate net monthly benefit after tax, total disability income including any other sources, and whether a shortfall or cushion remains. Optional fields let you account for taxable benefits and supplemental income streams.

Gross salary protected by the long-term disability policy.
Percentage of salary the policy pays while on claim (e.g., 60%).
Mortgage or rent, insurance, groceries, debt payments, and other required monthly obligations.
Optional — defaults to 0%. Enter your marginal tax rate if employer-paid benefits are taxable.
Optional — defaults to $0.00. Include Social Security Disability, spouse income, or passive cash flow.

Policy terms vary widely. Confirm benefit amounts, offsets, and taxation with your insurer or financial advisor before making coverage decisions.

Examples

  • Example 1 — $120,000.00 salary, 60% replacement, $5,500.00 expenses, 20% tax rate ⇒ Net monthly benefit after tax: $4,800.00 | Total disability income covering essentials: $4,800.00 | Expense coverage ratio: 87.27% | Monthly shortfall: $700.00 | Annual shortfall: $8,400.00
  • Example 2 — $85,000.00 salary, 55% replacement, $3,500.00 expenses, tax blank, $600.00 other income ⇒ Net monthly benefit after tax: $3,895.83 | Total disability income covering essentials: $4,495.83 | Expense coverage ratio: 128.45% | Monthly cushion: $995.83 | Annual cushion: $11,949.96

FAQ

How do own-occupation riders affect this calculation?

Own-occupation coverage determines when benefits trigger, not the replacement percentage. Enter the policy's payout rate and adjust expenses if you expect partial work income under the rider.

What if my policy has a cost-of-living adjustment (COLA)?

Increase the replacement rate slightly or rerun the calculator with next year's projected benefit amount to approximate the COLA impact.

Should I include optional expenses like travel or dining out?

Focus on must-pay bills first. You can rerun the calculator with discretionary spending added to see what lifestyle upgrades become possible if there's a cushion.

Can I model Social Security offsets?

Yes. Subtract expected offsets from your policy's benefit or include SSDI in the other income field so the calculator reflects the net amount you keep.

Additional Information

  • Employer-paid long-term disability benefits are usually taxable; enter your marginal rate to get a realistic net benefit.
  • Most policies cap monthly benefits — if your income exceeds the cap, reduce the salary input to the covered portion.
  • Add Social Security Disability Insurance or spouse earnings in the optional income field to measure the true household cushion.
  • Use the shortfall output to size emergency funds or supplemental policies that plug the income gap during a lengthy claim.

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