How Much Life Insurance Do You Need? Every time you are asked about choosing a new life insurance policy or adding additional coverage, do you have any of the following reactions?
“No way. We took care of this years ago. Having some kind of life insurance policy is what you are supposed to do.”
“Well, it’s just a few dollars more each month… But what if we never end up using that rider’s benefits? What if you could spend that extra money on something more important now, like buying the new lawn mower you wanted?
“ANOTHER RIDER FOR MY POLICY ?! Sign me up!”
Although there may be some similar responses when faced with the decision to improve what you already have, with the right guidance, you can finance a policy that has the potential to protect what is most important to you and your family, that fits your needs. needs. and get closer to financial independence.The most honest answer I can give you about how much life insurance you really need? It will depend on you and your goals.
General rules of thumb on this topic are everywhere. For example, a “rule” states that your death benefit payment on your life insurance policy must equal 7-10 times the amount of your annual income. But this amount alone may not take into account other needs your family might face if you were suddenly no longer around …
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- Payment of any debt you have accumulated
- Final expenses settlement
- Ongoing mortgage payments (or surprise maintenance costs)
- Financing a college education for your children
- Help a spouse continue on their path to retirement
- And these are just a few of the pain points your family could face without you.
So beyond a baseline of funds necessary for your family to continue with some financial security, the amount of life insurance you need will depend on you and what your current circumstances allow.
If you’ve had enough guesswork, a reactionary approach to how you’ll provide for your loved ones in the event of an unexpected tragedy, give me a call – we’ll work together to tailor your policy to your needs!