Research

     One common approach you can use to calculate the amount of Life Insurance you need is using the "DIME" method. It takes into account factors like Debt, Income, Mortgage payments, and Education costs.

• Debt: Add all existing debt to determine how much it would cost your family to repay the outstanding balance due after your untimely death.
• Income: Determine your annual income and how many years of income replacement are necessary to provide for your loved ones: i.e. if your spouse and children would be reliant on your $50,000 annual income for 15 more years, $750,000 in coverage would be needed.
• Mortgage: If you want your surviving family members to be able to keep the family home. Take the remaining mortgage balance into account and add it to the amount of life insurance.
• Education: To make sure your children are able to afford a college education, figure out how much educational costs would be and add this amount to the death benefit.

     The combination of debt, income, mortgage, and education will allow you to get the exact total amount of life insurance necessary for all your financial obligations to be fulfilled after an untimely death.