Disability Income Replacement Estimator (2025)
Estimate the monthly disability insurance benefit you'd need to protect your lifestyle if an injury or illness stopped your income.
Pre-tax income
From employer disability plan or government benefits
Usually 60-80% of income
Rent, bills, groceries
Optional spending
Used to estimate total payout need
This tool helps you determine how much disability insurance coverage you'd need to replace lost earnings if you couldn't work. It uses your income, expenses, and existing benefits to estimate the coverage gap and total protection required for various disability lengths.
Nearly 1 in 4 Americans will experience a disabling condition before retirement age. Disability insurance ensures your family can continue paying bills, mortgage, and daily expenses when paychecks stop.
| Employment Type | Recommended Replacement | Notes |
|---|---|---|
| Salaried Employee | 60–70% of income | Standard employer plans |
| Self-Employed / Contractor | 70–80% | No employer coverage |
| Dual-Income Household | 50–60% | Partial reliance |
| Primary Earner | 75–85% | Main income source |
- 1.Start with your take-home pay.
- 2.Subtract existing disability benefits (from employer or government).
- 3.Adjust for taxes, most employer-paid benefits are taxable, while personal policies are not.
- 4.Estimate necessary monthly expenses to maintain lifestyle.
- 5.Multiply the gap by expected disability duration.
| Scenario | Monthly Income | Existing Benefit | Gap | Duration | Total Benefit Needed |
|---|---|---|---|---|---|
| Office Worker | $6,000 | $1,000 | $3,200 | 12 mo | $38,400 |
| Self-Employed | $8,000 | $0 | $5,600 | 18 mo | $100,800 |
| Dual-Income Family | $10,000 | $2,000 | $5,000 | 24 mo | $120,000 |
Q1: What's the difference between short-term and long-term disability insurance?
A: Short-term covers the first 3-6 months; long-term kicks in afterward and can last years.
Q2: Are disability benefits taxable?
A: Employer-paid benefits are usually taxable; personally paid policies are not.
Q3: How much does disability insurance cost?
A: Typically 1-3% of annual salary, depending on occupation and benefit duration.
Q4: Can self-employed people get disability insurance?
A: Yes, through individual long-term disability policies tailored for business owners.