How much Life Insurance do you need?

The toughest part of buying life insurance is determining how much you need. Since everyone's financial condition and goals are different, there is no rule of thumb that can tell you 100% what your life insurance requirement are. However, with a little effort you can come up with a good estimate.

The best way to determine your life insurance needs is to have a life agent conduct a Financial Needs Analysis.

Here's how it works. The agent starts by obtaining your financial information and estimates of what your family members would need to maintain their currently living standard if you were to pass away today.

Next, the agent will tally up all the resources that your surviving family members could draw upon to support themselves. The difference between their needs and resources is the amount of life insurance you need to purchase.

When you consider all the things that life insurance benefits need to fund and how long the money will be needed, you could find that your coverage is 10, 15 or 20 times greater then your annual income.