How Much Life Insurance Do You Actually Need?
The honest answer isn't a magic number! It's a simple calculation based on the life you want your family to keep living.
"How much life insurance do I need?" is one of the most common questions we hear... and one of the most misunderstood.
A good starting framework is to cover what your income provides today. Think about it in four parts:
- Income replacement: enough to replace your paycheck for the years your family would need it.
- Debts: mortgage, car loans, and any balances you wouldn't want to leave behind.
- Future goals: your children's education or a spouse's retirement.
- Final expenses: so grief is never compounded by a bill.
Some people are over-insured on the wrong things and dangerously under-insured on the essentials. The right amount is personal, and it changes as your life changes, which is exactly why we review it regularly rather than setting it once and forgetting.
Where this applies
The parts of a plan this article touches, explained in full.
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