Short/Long Term Disability benefits: state vs employer?
November 19, 2023 6:25 PM Subscribe
It's time to re-up my benefits through my job, and I am wondering if I should get the private short-term and long-term disability offered through my job benefits when I live in California, where the state already offers a similar deal. Can anyone in CA specifically help me decipher this?
One reason I wonder is because last year I recall our HR person saying something about how the benefits are great but not really necessary if the employee lives in a state where are already offered, like CA. The company has employees throughout the US, if that's not clear. Would love any insigh on this; I gotta get my choices in by EOD tomorrow. Thanks!
One reason I wonder is because last year I recall our HR person saying something about how the benefits are great but not really necessary if the employee lives in a state where are already offered, like CA. The company has employees throughout the US, if that's not clear. Would love any insigh on this; I gotta get my choices in by EOD tomorrow. Thanks!
I was able to sign up for short term disability through my employer for the first time this year. It only pays out 20%. A friend was on CA state disability a couple of years ago and it paid out 65%, untaxed. The math didn’t make sense for me, but if you’re living paycheck to paycheck and/or have a small emergency fund it might make sense for you.
posted by sacrifix at 7:22 PM on November 19
posted by sacrifix at 7:22 PM on November 19
You could use the calculator here to see how much CA disability would pay you, if you use it. You may find that it is or is not close to the salary you usually earn, and then decide if it's worth it to pay for extra. And yeah, CA disability is untaxed, so you have to somehow figure that into your math. (Mr. Blah has been on CA short-term disability for an issue, and we've found it comes very close to his salary. Add in the untaxed part and it's basically a win.)
posted by BlahLaLa at 7:28 PM on November 19 [1 favorite]
posted by BlahLaLa at 7:28 PM on November 19 [1 favorite]
60 to 70 percent of the wages you earned 5 to 18 months before your claim start date and up to the maximum WBA...Mr. Blah has been on CA short-term disability for an issue, and we've found it comes very close to his salary. Add in the untaxed part and it's basically a win.
? The benefit is "60 to 70 percent of the wages you earned 5 to 18 months before your claim start date and up to the maximum WBA." I know CA taxes aren't modest, but the only way that's going to be "very close" is if your income decreased during the measurement period (or, I suppose, if you ignore federal taxes, retirement contributions, FSA contributions, or other paid-for benefits like health insurance, since those won't come out of your disability payment as they would out of a regular paycheck).
My feeling is that you rarely find you need less income while disabled, but really this isn't a question for HR. They have no idea what you need or don't need. The math on what the state benefit should be is simple. Can you live on that? If not, you should be considering the supplemental, unless it is punishingly expensive. Particularly if you're single and so don't have another income to lean on while sick.
posted by praemunire at 9:46 PM on November 19
? The benefit is "60 to 70 percent of the wages you earned 5 to 18 months before your claim start date and up to the maximum WBA." I know CA taxes aren't modest, but the only way that's going to be "very close" is if your income decreased during the measurement period (or, I suppose, if you ignore federal taxes, retirement contributions, FSA contributions, or other paid-for benefits like health insurance, since those won't come out of your disability payment as they would out of a regular paycheck).
My feeling is that you rarely find you need less income while disabled, but really this isn't a question for HR. They have no idea what you need or don't need. The math on what the state benefit should be is simple. Can you live on that? If not, you should be considering the supplemental, unless it is punishingly expensive. Particularly if you're single and so don't have another income to lean on while sick.
posted by praemunire at 9:46 PM on November 19
At a previous employer in CA, there was an option to buy insurance to increase the percentage of salary covered. So if CA sdi would pay 55%, then you add this supplement, and the private company would pay you 11%, which all added up to 66% of your income. You get a bunch of checks in the mail, so much fun!
As I recall, it was pretty cheap to buy the add-on insurance.
I would get clarification on if this program replaces or supplements CA SDI...
posted by skunk pig at 11:36 PM on November 19 [1 favorite]
As I recall, it was pretty cheap to buy the add-on insurance.
I would get clarification on if this program replaces or supplements CA SDI...
posted by skunk pig at 11:36 PM on November 19 [1 favorite]
« Older Recommendations for food and activities in Chicago... | What to do with family on trip to big island... Newer »
You are not logged in, either login or create an account to post comments
posted by shock muppet at 6:43 PM on November 19 [1 favorite]