Disability Income Insurance Calculator

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• Summary

Step 1: What is your estimated after-tax monthly income? Client Name:         Local Representative:             Gross Annual Income:     Enter your gross annual income. The calculator will calculate your estimated after-tax monthly income and enter it below. (Spouse income is entered later.)           Estimated Tax Bracket:     25% represents an average household tax bracket including Federal, State and FICA taxes. Consult your tax advisor for complete details.           Estimated After-Tax Monthly Income:               Step 2a: What household income would be available if you became disabled? If you have disability insurance through your employer, select percentage or use 'Other' to enter dollar amount of income covered. Group Disability Insurance Benefit:   66.6% 60% 50% 0% Other   Because group disability insurance benefits are usually taxable, your benefit amount is illustrated in after-tax dollars in the graph at right. After taxes, even a typical policy that covers 60% of your income may be reduced to only 45%. Will that be enough?           Enter Percent:     If you have disability insurance through your employer, please enter the appropriate percentage OR         Enter Monthly Dollar Amount:     If you have disability insurance through your employer, please enter dollar amount of income covered           Maximum Monthly Benefit:   $5,000 $10,000 $15,000 Other   The maximum amount the insured is eligible to receive based on policy guidelines. The most common formula is 60%, not to exceed $5,000 month.           Enter Maximum Monthly Dollar Amount:     If you choose other under Maximum Monthly Benefit, please enter an amount.           Waiting Period:   90 days 180 days 365 days Other   More information           Enter Maximum Waiting Period in Days:     If you choose other under Waiting Period, please enter in the number of days Benefit Period:   2 years 5 years To Age 65 Other   More information           Benefit Period in Years:     If you choose Other under Individual Benefit Period, please enter your benefit period in the number of years. Existing Monthly Individual Disability Income Insurance Benefit:                 Individual Waiting Period:   30 days 60 days 90 days 180 days 365 days Other   If you choose "other" under Individual Benefit Period, please enter in number of years. More information           Individual Waiting Period in days:     If you choose other under Individual Waiting Period, please enter in the number of days Individual Benefit Period:   2 years 5 years To Age 65 To Age 67 Other   Proceeds from individual disability income policies are typically not taxable if premiums are paid by you. Consult your tax advisor for details. More information             Benefit Period in Years:     If you choose other under Individual Benefit Period, please enter your benefit period in the number of years         Step 2b: What household income would be available if you became disabled? Monthly Social Security Disability Benefit:     In most cases, this answer will be zero. For an exact figure, visit the Social Security website. Do Not Enter an amount here if you have already entered an amount for group disability insurance. If you have Group Long-Term Disability (LTD) coverage, benefits will be integrated with any Social Security disability benefits you might receive. Did you know: More than 1.3 million workers who applied for Social Security Disability Insurance benefits in 2005 were denied coverage. Source: Social Security Administration Office of Disability Income Security Programs, as seen on www.disabilitycanhappen.org, August 2007.           Additional Household Income:     Add the after tax monthly value of other sources of income such as spouse income, rental income, etc.           Step 3a: What are your monthly expenses? Mortgage / Rent:     Even if your mortgage is paid off, be sure to consider the monthly cost of property taxes, association dues and other fees if applicable.           Did you know: Disability causes nearly 50% of all mortgage foreclosures, compared to 2% caused by death? Source: Health Affairs, The Policy Journal of Healthsphere, February 2, 2005, as seen on www.disabilitycanhappen.org, August 2007.           Utilities and Household Expenses:     Please enter an estimate. Examples include: electricity, gas, water, phone, cable, internet and waste management. This worksheet may help.           Food / Household Supplies:     Please enter an estimate. Be sure to include dining out.           Step 3b: What are your monthly expenses? Auto Payments and Expenses:     Please enter an estimate. Include fuel and maintenance costs. This worksheet may help.           Loans, Credit Cards and Charge Accounts:     Total the amount you typically pay each month on your loans and credit cards. This worksheet may help.           Insurance Premiums:     Total your current monthly premiums for medical, dental, life, auto, homeowner's, and other types of insurance. This worksheet may help.           Step 3c: What are your monthly expenses? Childcare:     Add the monthly cost for childcare, school lunches and special interests or events. This worksheet may help.             Saving and Investing:     Are you setting aside money for retirement, college expenses or an emergency fund?             Other Monthly Expenses:     Add the monthly cost for 'other' expenses, such as entertainment, clothes, etc. This worksheet may help.                Printable Page Summary To explore additional possibilities, play "what if" by changing your inputs on the results summary below. (Use the Tab key to move from one input to the next.) Step 1 Net Monthly Income: Step 2   Group Disability Percent: 66.6% 60% 50% 0% Other Enter Percent: or   Enter Monthly Amount: Group Disability Insurance Benefit: Maximum Monthly Benefit: Waiting Period: Duration of Benefits: Individual Disability Insurance: Waiting Period: Duration of Benefits: Monthly Social Security Disability: Additional Household Income: Total Disability Income Sources: Step 3   Mortgage / Rent: Utilities and Household Expenses: Food / Household Supplies: Auto Payments / Expenses: Loans, Credit Cards and Charge Accounts: Insurance Premiums: Childcare: Savings / Investment: Other Monthly Expenses: Total Monthly Expenses: Your Monthly Disability Income Gap:

Disability Income Gap: The difference between your total disability income sources and your estimated monthly expenses. This amount represents the gap in financial protection that exists should you become disabled. This is a hypothetical example. Remember, disability income insurance does not cover 100 percent of your income. Your financial representative can illustrate the amount you're eligible for, based on current underwriting guidelines. Help

Disability income insurance from Principal Life Insurance Company can help protect you and your family's financial security. And – depending on your age, income and other factors – it can be one of the most affordable components of your financial protection strategy.

Whether your goal is maximum income protection, safeguarding specific expenses (mortgage, tuition, retirement), or budget-based coverage -- Principal Life can help. To find out more, contact your Principal Life financial representative.

Disability insurance has limitations and exclusions. For costs and complete details of coverage, contact your Principal Life representative. Insurance issued by Principal Life Insurance Company. Principal Life is a member of the Principal Financial Group®, Des Moines, IA 50392. This information is believed to be accurate and authoritative in regard to the subject matter covered. The accuracy of the information is not guaranteed and is provided with the understanding that Principal Life is not rendering legal, accounting or tax advice. In specific cases clients should consult their legal, accounting or tax advisors.