How
Much Life Insurance Do I Need?
The answer isn't really
how much life insurance you need, it's how much
money your family will need after you're gone.
Ask yourself:
- How much money will my family
need after my death to meet immediate expenses,
like funeral expenses and debts?
- How much money will my family
need to maintain their standard of living over
the long run?
Life insurance proceeds can
help pay immediate expenses including uncovered
medical costs, funeral expenses, final estate
settlement costs, taxes and other lump-sum obligations
such as outstanding debts and mortgage balances.
They can also help your family cover future financial
obligations like everyday living expenses, money
for college or your spouse's retirement, and so
much more.
But how do you know if you need
$100,000, $500,000, $1 million or more? The most
common way to determine your life insurance needs
is by conducting what's called a Capital Needs
Analysis.
Here's how it works. Start by
evaluating your family's needs. Gather all of
your personal financial information and estimate
what your each of your family members would need
to meet current and future financial obligations.
Then tally up all of the resources that your surviving
family members could draw upon to support themselves.
The difference between your their needs and the
resources in place to meet those needs is your
need for additional life insurance (see diagram
below).
This may look simple enough,
but calculating one's life insurance needs can
actually get pretty complicated. To make it easy
for you to get a general sense of your needs,
check out our life insurance needs calculator.
It'll walk you through the process and provide
you with an estimate of your insurance needs in
a matter of minutes.
But remember, our calculator
(or anyone else's for that matter) is no substitute
for the guidance and assistance you'll get by
meeting with a qualified insurance agent or other
financial professional. So if you're serious about
protecting your family's future, call us.
Click
Here for a Quote
Check
out these other life insurance coverages that
we offer!
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