for a healthy 63 year old nearing retirement in 3 years with recently taking a less stressfull job,
short term disability or long term disability insurance is offered .
Is there a big drawback to either?
The only drawback is the cost. It can take a while if you are disabled to qualify for the Social SecurityDisability Insurance payments. And since you are so close to full retirement age, those payments would end in a few years anyway. Most disability policies only last until you qualify for Social Security. Check the terms of what is being offered, paying special attention to the definition of disability. Some policies won’t pay if you can do ANY work at all; others pay if you are unable to do your previous occupation. By way of comparison — a “disabled” surgeon might not be able to operate, but perhaps could consult and earn money as a physician in that manner, though not nearly enough to give him his/her previous income. That’s where disability insurance is a real benefit. But it IS expensive to buy on your own. (Oh, and if it is a job benefit, the payments if you access them could be taxable, whereas a policy you purchase on your own would give you tax-free benefits.