How much life insurance should an individual own?
“Rule of thumb” suggests an amount of life insurance equal to 6 to 8 times annual earnings. However, many factors should be taken into account when determining the right amount of life insurance for you and your family. Important factors include: • Income sources (and amounts) other than salary/earnings • Whether or not you are married and, if so, what is your spouse’s earning capacity • The number of individuals who are financially dependent upon you • The amount of death benefits payable from Social Security and from an employer-sponsored life insurance plan • Whether any special life insurance needs exist (e.g., mortgage repayment, education fund, estate planning need, etc.) Calculating the correct amount of life insurance to buy is not as simple as it appears. We recommend contacting us for help determining the right amount of coverage. As independent agents, we are unbiased advisors that will help you avoid buying too much, show you appropriate optional coverages for your need and
Rough “rules of thumb” suggest an amount of life insurance equal to 6 to 8 times annual earnings. However, many factors should be taken into account in determining a more precise estimate of the amount of life insurance needed. Important factors include: -Income sources (and amounts) other than salary/earnings; -Whether or not the individual is married and, if so, what is the spouse’s earning capacity; -The number of individuals who are financially dependent on the insured; -The amount of death benefits payable from Social Security and from an employer sponsored life insurance plan; and -Whether any special life insurance needs exist (e.g., mortgage repayment, education fund, estate planning need), etc.; It is recommended that a person’s insurance advisor be contacted for a precise calculation of how much life insurance is needed.
Rough “rules of thumb” suggest an amount of life insurance equal to 6 to 8 times annual earnings. However, many factors should be taken into account in determining a more precise estimate of the amount of life insurance needed. Important factors include income sources (and amounts) other than salary/earnings, whether or not the individual is married and, if so, what is the spouse’s earning capacity, the number of individuals who are financially dependent on the insured, the amount of death benefits payable from Social Security and from an employer-sponsored life insurance plan, whether any special life insurance needs exist (e.g., mortgage repayment, education fund, estate planning need), etc. It is recommended that a person’s insurance adviser be contacted for a precise calculation of how much life insurance is needed.
