Life Insurance – How Much Do I Need?
The amount of life insurance you choose should be based on calculations, not your gut instinct. Carve out 1 minute right now to learn your number and then you can confidently begin to seek out a product that best matches the need.
Most often when I am approached about life insurance the person requesting it does not have much of an idea as to how much he or she actually wants or needs in life insurance. This is a very important piece of your financial plan and should never be left to chance. Here is the bottom line – if you die tomorrow, how much money will those that depend on you need?
There is no shortage of life insurance calculator tools out there, but here are a just a few questions to answer, which will help you come up with your number:
- Multiply your current annual income by 10
- Add in $200,000 per child
- Add in your debt (mortgage, car loans, student loans, and any other debt)
Chances are that when you think about the answers to these questions, you will find that your number is much higher than your gut led you to believe. Life insurance is meant to ease the financial burden on those that depend on your income in the event of an untimely death. Don’t just pick $1,000,000 because it sounds like a lot of money and it helps you sleep at night. Get precise with your family’s financial future, so they can sleep well at night. Life insurance is not about you…it’s about them. Get serious about it.