How much life insurance do I need? (Life Insurance Calculator)
Most people agree that life insurance is important. But a critical question is “How much life insurance do I need?”
Life insurance policies come in many shapes and sizes. The key is choosing a policy that best fits your — and your family’s — needs. For example, a term life insurance policy gives you coverage for a period of time that you choose, while whole life insurance provides permanent coverage that can last your entire lifetime.
While it’s impossible to determine the exact amount of life insurance you’ll need, you can make a fairly accurate estimate by assessing your current financial situation and taking into consideration what your loved ones might need in the coming years. This helpful calculator can further help you pinpoint how much coverage is right for you, based on the financial support you wish to leave for your loved ones.
Keep in mind, though, that not all insurance companies are the same, so do your homework and make sure to find one that is trustworthy. Your life insurance policy should make things easier for your loved ones during a difficult time in their lives. With that in mind, choose a company with a good reputation that will treat them with the care and attention they deserve, and will pay their benefit in a timely manner.
Finally, remember to revisit the question of “How much life insurance do I need?” annually, as well as after major life events (such as divorce, marriage, the birth or adoption of a child or grandchild, or a home purchase) or any time you have a significant change in your financial situation. Occasionally, a policy update might be needed to add or remove beneficiaries, or increase or reduce your coverage.