Life Insurance Calculator
Estimate how much coverage you need (DIME-style: Debt, Income, Mortgage, Education).
How Much Life Insurance Do I Need?
Life insurance helps replace your income and pay off debts if you die, so your family is not left struggling. Figuring out how much you need is a balance: too little leaves them exposed; too much costs more than necessary. Our calculator uses a DIME-style approach: Debt (credit cards, car loans, etc.), Income replacement (annual income × years you want to replace it), Mortgage (remaining balance), Education (estimated cost for kids’ college), plus final expenses (funeral, etc.). We also show a simple 10× income rule of thumb for comparison.
Term vs permanent life insurance
Term life pays a death benefit if you die during the term (e.g., 10, 20, or 30 years); it is usually the most affordable way to get a large amount of coverage. Permanent life (whole or universal) lasts for life and can build cash value but is more expensive. For most families, term life is enough to cover the DIME needs until the mortgage is paid and kids are grown. Use our calculator to get a coverage number, then shop for term quotes. Pair with an emergency fund and retirement calculator so your overall plan is solid.
When to revisit coverage
Re-run the numbers when you have another child, buy a bigger home, get a raise, or pay off major debts. As you age and dependents become independent, you may need less coverage. Our net worth calculator can help you see how much your family would have without life insurance; that informs how much coverage makes sense.
Life Insurance Calculator FAQ
A common approach is the DIME method: add debt, income replacement (years × income), mortgage balance, education fund goal, and final expenses. Our calculator does this and also shows the 10× annual income rule. Your actual need may be higher or lower depending on other assets and your family’s lifestyle.
It suggests buying life insurance coverage equal to 10 times your annual income. It is easy to remember but does not account for debt, mortgage, or education. DIME is more tailored; we show both so you can compare.
If no one relies on your income and you have no joint debts (e.g., no co-signed loans or shared mortgage), you may need little or no life insurance. Some people still buy a small policy to cover final expenses or leave a gift. Revisit if you get married, have kids, or take on dependents.
Plan Your Full Retirement
Use our retirement calculator for Monte Carlo simulations and country-specific planning.
Try Retirement Calculator