Expert Q&A

This is a great question because the amount of life
insurance coverage you should have will actually change as your life changes. A
new home, a new job, the addition of children will all change your
circumstances. Working with a professional advisor to conduct a financial needs
analysis is the first place to start. This usually will consist of evaluating
your income, how many years until retirement, college savings (if any), and all
debts including your mortgage. It is important to revisit your situation on an annual
basis with your advisor.

The best way to determine how much life insurance is needed is to have a financial needs analysis performed. It is something that should not be done only once. You need to have it done periodically, particularly when your circumstances change.The analysis can be performed by an insuranced-based financial advisor. I hope this helps.

In a simple way- Take your annual income – multiply by the number of years left until retirement. Add college for the kids, and ALL debts including your mortgage. That’ll give you a round number…but honestly, talk to a professional. They’ll have lot’s of options for your life insurance needs, including reasons to consider different companies. Find an independent who’s not tied to one product line…

In a simple approch this should be based on the money you have comming in to your household vs the money you have going out. Furthermore, if there are any special wishes you would like for someone one upon your death.

A lot of different opinions to choose from. Take your Debt minus your Income plus your Mortgagae and the cost of Education for your children through college, what is the answer? Now add your Income times five and this will get you very close. Like one of the answers pointed out, you should review this every couple of years.

Experts recommend anywhere between 8 – 12 times your annual income in life insurance. The logic goes like this… if you earn $40K a year in income and say you had 10x that amount in life insurance. That would be $400k worth of coverage, if you passed away and your family took that money and invested that money into a good mutual fund that earned an average 10% per year, that policy would have adequately protected your income. Get a good 20 year level-term policy and invest. Good luck.

Experts recommend anywhere between 8 – 12 times your annual income in life insurance. The logic goes like this… if you earn $40K a year in income and say you had 10x that amount in life insurance. That would be $400k worth of coverage, if you passed away and your family took that money and invested that money into a good mutual fund that earned an average 10% per year, that policy would have adequately protected your income. Get a good 20 year level-term policy and invest. Good luck.

Life insurance needs can be specifically determined by a qualified financial advisor. The actual amount needed is determined by numerous factors including:
Family obligations, (i.e. – single, married, child support obligations, family special needs, etc.).