How to Determine the Amount of Life Insurance You Need
- 1). Calculate your after-tax income and then count the number of years of life expectancy remaining.
- 2). Consult a reputable agent and use an insurance company's computer program to plug in numbers and generate a figure.
- 3). Add outstanding debts, such as your mortgage, car loan and credit card debt.
- 4). Remember to allow for any medical costs and funeral expenses.
- 5). Remember that your family may also benefit from pension and Social Security benefits.
- 6). Consider your spouse's ability or desire to earn income and consider extra child care costs.
- 7). Remember the special needs of a disabled child or a parent whom you support.
