The question I get most is "how much do I need?" There's no single right answer, but there is a clear way to find yours.
Step 1: Add up what your family would need
- Income: your yearly income times the number of years your family would need it. Many people choose until the youngest child is grown.
- The house: what's left on the mortgage.
- Debts: car loans, credit cards, student loans.
- School: what you'd want set aside for each child after high school.
- Final costs: a funeral and final bills. See what a funeral typically costs.
Step 2: Subtract what you already have
- Life insurance through work
- Other policies you own
- Savings your family could use
What's left is your starting number.
Prefer to watch?
Nick walks through DIME with two examples: a young family and a retiree. About 4 minutes.
An example
| What the family needs | How it's figured |
|---|---|
| Income | Yearly income × years until the youngest is grown |
| House | Mortgage balance |
| Debts | Car, cards, loans |
| School | Amount per child × number of kids |
| Final costs | Funeral and final bills |
| Minus | Work coverage, other policies, savings |
Our 60-second calculator does this math for you.
If you're over 50
If the kids are grown and the house is close to paid off, your number may be much smaller. Many people at this stage just want the funeral and final bills covered. That's what final expense insurance is for.
Then fit it to your budget
The number is a starting point. If the full amount doesn't fit your budget, some coverage is better than none. A good agent will help you balance the two.
Want help finding your number?
Get the free guide with examples by age, or book a free call and I'll do the math with you.
Common questions
Is 10 times my income enough?
It's a common rule of thumb, but your real number depends on your mortgage, debts, kids and savings. Adding them up gives a better answer.
How much life insurance do I need at 60?
Often less than at 35. If the kids are grown and the house is mostly paid off, many people just want the funeral and final bills covered.
Should I count my work coverage?
Yes, but remember it usually ends if you leave the job.
Where can I get help with the math?
Use the calculator on our term page, get the free guide by email, or book a free call.
Nick Brown is an independent life insurance agent with NJN Insurance, licensed in Arizona (License 19720244). He compares plans from several companies and explains them clearly. NJN stands for Not Just a Number.