How much life insurance do I need?

The answer to this question will vary greatly from person to person.  For instance if you don’t have anyone that depends on you financially and you have enough to pay for your final expenses you may not need life insurance.  If you do have dependents than you will want to make sure that the life insurance policy you buy is sufficient to replace your income as well as cover any services that you would have provided for the family.  An example of that would be if you are a handyman and usually fix everything around your home, your family may have to hire someone to take care of that which would be an extra expense.

You should consider all of your debt and make sure that your surviving dependents will be able to payoff those debts.  This would include, but is not limited to, mortgage, business loans, student loans, credit cards, car loans and any other financial responsibilities.  If your spouse works and plans to continue working than you need to consider daycare expenses.  You should also include money for your final expenses which generally range from $10,000 to $15,000.

This is a very sensitive subject that most people don’t like to talk about but think about this for a minute.  Would you rather have an awkward talk now, or leave your family broke and clueless trying to figure out how to pay for your funeral?  Discuss these questions with your dependents as well as any other things that may be important to you.

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