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SamuraiBiker writes:
<<I have an occupation specific disability insurance with an option to increase the monthly benefit.>...<I can increase my monthly benefit by 24% for an increase in my monthly premium of 29%.>>

What you don't mention is the costs involved. If it were %29 of $250/yr, I'd probably take it - but in my experience, disability insurance is more like $1000-$2000, you you might be talking $300-$600/year extra.

I would probably go for it, as %40 of current AGI seems a bit low to me. The rules of thumb I generally hear are %60 or so (with obvious adjustments for AGI - if you're making $200k/yr, you probably don't need $100k/yr coverage).

Also, keep in mind other sources. I think you get soc. sec. payouts for certain types of disability, and you can also tap IRAs for certain types. And if "occupation specific" means what I think it does, that could also be a factor. For instance, a computer programmer may lose the ability to type - yet still be able to make a good living in another job, in which case %40 versus %30 payout isn't that big a deal.

Later,
shess
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