How Much Life Insurance Do You Need?
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We know it's not the most exciting thing in the world, but making sure you have the right life insurance is a critical part of your financial plan.
Having the right amount of life insurance coverage gives you the peace of mind that your loved ones will be provided for if something happens to you. That's why it's one of the most important financial transactions you'll ever make.
We designed our How Much Life Insurance Do I Need worksheet to make it easy for you. Just plug your numbers into this worksheet to determine how much insurance coverage you need without overspending.
| A. | Annual family living costs | $ | ______ |
| B. | Sources of income: | $ | ______ |
| Spouse | $ | ______ | |
| Investment income | $ | ______ | |
| Social Security benefits from company plans | $ | ______ | |
| Income from life insurance proceed | $ | ______ | |
| Total: | $ | ______ | |
| C. | Additional income needed: | ||
| Subtract B from A to determine shortfall | $ | ______ | |
| D. | Insurance needs for shortfall: | ||
| Assuming an interest rate of 5% | $ | ______ | |
| Assuming an interest rate of 6% | $ | ______ | |
| Assuming an interest rate of 7% | $ | ______ | |
| Assuming an interest rate of 8% | $ | ______ | |
| E. | Additional cash requirements: | ||
| Funeral expenses | $ | ______ | |
| Loans and debts that should be paid | $ | ______ | |
| Education expenses | $ | ______ | |
| For children | $ | ______ | |
| Total: | $ | ______ | |
| F. | Needed insurance death benefit: | ||
| Add D and E Total: | $ | ______ | |
To learn more about life insurance, be sure to read these articles:
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