How much Life Insurance do you need?
Well, the answer isn't really how much life insurance you need... it's how much investment capital your family will need at the time of your death. Their need for capital -- on a gross basis -- is really a function of two variables:

(1). How much will be needed at death to meet immediate obligations; and

(2). How much future income is needed to sustain the household.

The first category is fairly easy to estimate. It's the sum of final expenses (including uncovered medical costs, funeral expenses and final estate-settlement costs) and other lump-sum obligations (such as outstanding debts, mortgage balance, and college costs).

The second variable is a bit trickier. It involves calculating the "present value" of future needed cash-flow streams. By meeting with a Professional Agent in person you can get a rough sense of the needs for capital that might exist at your death.

A few tips:
A financial analysis of your needs depends upon the answers you provide. Please answer all questions your agent will need to ask to help you.. If you do not understand a question, tell them to "slow Down"or speak regular English, and we'll explain what we're driving at.

A Professional Agent will provide a rough sense of your potential life insurance needs. To the extent that you or your beneficiaries are eligible for Social Security benefits, those benefits (unless you want them included) are usually not included in this analysis. Social Security benefits, if available, will somewhat reduce the need for life insurance. For a more accurate and detailed analysis, contact a professional life insurance agent.

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Life insurance helps to ensure that your family and loved ones are protected against financial difficulties in the event of a premature death. Combined with investments, retirement and estate planning, life insurance is a fundamental part of a sound financial plan. With the help of an insurance professional you can develop a complete plan that will protect you and your family. This Web Page will give you basic information about various types of life insurance, how to choose a professional agent, conducting a needs analysis, and the basics of estate planning.

Life insurance is the foundation of a sound financial plan. It provides financial security for your family by protecting your financial resources, such as your present and future income, against the uncertainties of life.

More specifically, life insurance provides cash to your family after your death. This cash (the death benefit) replaces the income you would have provided and can meet many important financial needs: It can help pay the mortgage, run the household, send your kids to college, and ensure that your dependents are not burdened with debt. The proceeds from a life insurance policy could mean that your family won't have to sell assets to pay outstanding bills or taxes. What's more, there is no federal income tax on life insurance benefits (in most cases).

While there's no substitute for evaluating your specific situation, one rule of thumb is to buy life insurance equivalent to five to ten times your annual gross income. To determine how much, if any, life insurance you need, start by gathering all your personal financial information and estimating what your family will need after you're gone. Include ongoing expenses (such as day care, tuition, or retirement) and immediate expenses at the time of death (like medical bills, burial costs, and estate taxes). Your family also may need funds to help them readjust: perhaps to finance a move, or pay expenses while job hunting. The best way to evaluate your specific needs is to contact a life insurance professional.

Choosing a life insurance product is an important decision, but it can be complicated. As with any major purchase, it is important that you understand your family's needs and the options open to you.

term Life Insurance provides protection for a specific period of time. It pays a benefit only if you die during the term. Some term insurance policies can be renewed when you reach the end of the term, which can be from one to 30 years. The premium rates increase at each renewal date. Many policies require that you present evidence of insurability at renewal to qualify for the lowest rates.