Coverage planning
How Much Life Insurance Do You Really Need?
By N. Caruthers
Determining how much life insurance you need can feel overwhelming, but the goal is simple: make sure your loved ones can maintain stability if something happens to you.
Start with the income your household depends on.
A common guideline is to multiply annual income by 10 to 15, but that is only a starting point. The better question is how long your family would need support and what your income currently protects.
Add the obligations that should not become someone else's burden.
Mortgage payments, rent, car loans, student loans, credit cards, childcare, and daily living expenses can all create pressure. Life protection can help keep those responsibilities from landing on loved ones at the worst possible time.
Then consider future goals.
College, retirement support for a spouse, caregiving, or a first home goal may all affect the coverage amount. Subtract existing savings and current coverage so the final number reflects a real gap instead of a guess.
Coverage needs vary by household. This article is educational only and is not tax, legal, investment, or insurance advice.
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