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How Much Life Insurance Do I Need?
Many of us ask ourselves this question. Although there are some general rules of thumb, like 4 to 6 times your annual income, the right amount for you depends on what you want the life insurance to do for you. Do you want to provide income for your survivors (spouse and children)? Do you just want to cover funeral expenses? Do you want to have adequate funds for your children’s education? Do you want to leave a charitable gift to your favorite charity?
These are some of the needs for life insurance. It is important to understand how life insurance can work for you when you are no longer around to take care of your loved ones.
As times change, your needs also change. It is important to meet with your agent at least once every year to discuss your changing needs. Maybe the children are grown and have moved out. Maybe you’ve just purchased your first home or a new home with a larger mortgage than the first. Maybe you’ve had a child.
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