Terminating LTD


#1

I know that feedback was given around terminating LTD early and from a financial standpoint this was not recommended for most people. However, upon seeking financial advice and health issues, I would be farther ahead financially to do this and my pension would provide me with more monthly income right now and going forward to help pay for some left over debt.

Question: Can you terminate LTD anytime - any repercussions from doing this. If I decided to take my employment pension - would I have to inform the insurance co. right away - takes 2-3 months for the pension to be processed If I needed to inform them right away would I suddenly be cut off with no income?
Would my insurance company compensate me in anyway for leaving them early?


#2

Are you sure you have to terminate LTD?
Typically I thought if pension taken early it is deducted from LTD benefits. Is your current pension greater than your LTD benefits.
Also, if you take the pension you will no longer be accruing service in the pension plan.
So for me it would be financially dis advantageous to take the pension early.


#3

Hi Reptorsfan

If I took my pension now it would be much larger income than what I am getting now and would really help with some unfortunate left over debt. I find it very hard living on a more limited income (50% less when you also take off tax) (and with debt)
I also get a bridge benefit until 65. The difference with waiting 2.5 years is not that significant for me upon speaking to a financial planner. No one can really predict how they will fair with a chronic illness but I do want to factor that in. and my quality of life. Things in that regard are not getting better.


#4

OK, great. Sounds like you’ve run the numbers and it makes sense in your case. I just wanted to make sure.

Good luck!


#5

Your health insurance/drug coverage will likely be worse.


#6

My group health benefits are tied into my employment not LTD and that will be ending this year. I can get private insurance but we will see if that is worth it or just putting money away.