Originally Posted by
Name User
I confess I do not know much about the APA offerings but I'd imagine as a younger person, paying the tax on LTD benefits to get tax-free LTD has a better long term return.
The under reported downside of the tax free LTD (particularly for a younger pilot) is that while you will receive your company 401k contribution in either case (calculated from your pre disability income level) if you opt for the tax free LTD then that contribution comes to you as taxable income and NOT into your 401k. For a younger pilot that could be forgoing some significant gains.
Should you not have the tax free LTD then it goes into your 401k. I believe any post LTD sick, vacation, or ESB payouts are seen as taxable income and you may have the ability to direct those into your 401k.
As always, consult someone much smarter than me before making financial decisions.