How much coveragewould they need?

How the calculator works

This calculator uses a simple needs approach. It adds up the money your family would need if you died, then subtracts the resources they could already count on. What's left is an estimate of the life insurance that could fill the gap.

What it adds up

• Income to replace: the yearly income your family would lose, multiplied by the years of support you want to provide (10 years by default).
• Mortgage balance: what's left to pay on your home, if you'd want it paid off.
• Other debts: car loans, lines of credit, credit cards.
• Future education costs: anything you'd want set aside for your children's studies.
• Final expenses: funeral and related costs, set at $15,000 by default. Change it if you have a better number.

What it subtracts

• Savings and investments your family would actually use.
• Existing life insurance, such as group coverage through your employer.

The result is needs minus resources, never below zero, rounded up to the next $25,000. Rounding up keeps a small cushion and gives you a round number to ask about.

A worked example

With example numbers: $50,000 of income to replace for 10 years is $500,000. Add a $250,000 mortgage, $15,000 of other debts, $30,000 for education and $15,000 for final expenses. Total needs: $810,000.

Now subtract $55,000 in savings and $100,000 of group life insurance at work. That leaves $655,000, which rounds up to an estimate of $675,000.

How to use the result

Treat the number as a starting point for a conversation, not a final answer. It keeps things simple on purpose, so a few things aren't built in:

• Inflation and investment returns. The calculator doesn't adjust future income or costs for either.
• Taxes and government benefits. Survivor benefits and the tax treatment of savings can change the picture.
• Group coverage that can end. Insurance through work often stops if you leave your job, so you may not want to count all of it.
• Your partner's income and plans. Some families want to replace a full income for many years; others need less.

Try a few versions. Change the years of support, or run it with and without your group coverage, and see how much the result moves. That range is often more useful than a single number.

Once you have a range, compare quotes for the same coverage amount and term so the prices line up. Our insurance page is a good place to start, and our other calculators can help with the rest of your coverage.