Life Insurance Needs Calculator
Calculate how much life insurance coverage you need based on income, debts, dependents, and existing coverage.
By Konstantin Iakovlev · Updated April 2026 · Source: CDC
Insurance Needed
$1,220,000.00
Estimated Monthly Premium
$793.00
30-yr term, age ~35
Recommended Term
15-year term
Insurance Needs Breakdown
| Income Replacement | $750,000.00 |
| Mortgage Payoff | $250,000.00 |
| Outstanding Debts | $15,000.00 |
| Funeral / Final Expenses | $25,000.00 |
| College Fund | $200,000.00 |
| Total Needs | $1,240,000.00 |
Existing Resources
| Existing Life Insurance | $0.00 |
| Liquid Savings | $20,000.00 |
| Total Resources | $20,000.00 |
| Coverage Gap (Insurance Needed) | $1,220,000.00 |
Premium Estimate Note
Estimated premium is based on ~$0.50-$1.00 per $1,000 of coverage for a healthy 35-year-old on a 30-year term policy. Actual rates vary significantly by age, health, smoking status, and provider.
Use the Life Insurance Needs Calculator above to calculate your results. Enter your values and see instant results — all calculations run in your browser.
Disclaimer: This calculator is for informational purposes only and does not constitute tax, financial, or legal advice. Results are estimates based on the information you provide and current rates. Always consult a qualified tax professional or financial advisor for advice specific to your situation.
How It Works
Figuring out how large a life insurance policy you actually need comes down to one question: what would your household have to cover if your income disappeared tomorrow? The right coverage amount keeps your family financially stable, letting them stay in their home, keep up with daily living costs, and fund a child's education without scrambling.
The engine behind this tool is the DIME method, which breaks the question into four parts: Debt, Income, Mortgage, and Education. It totals your outstanding debts, multiplies your annual income by the number of years you want to replace it, folds in your remaining mortgage balance, and adds a projection of future education costs to arrive at a target figure.
Where many households fall short is by sizing a policy to wipe out today's debts and stopping there, leaving no cushion for inflation, unexpected medical bills, or years of ongoing support. Treat your coverage as a living number and revisit it whenever a major life event, such as a new child, a move, or a salary change, shifts the math.
Example: Sarah's Life Insurance Needs
- 1 Sarah has a $200,000 mortgage, $15,000 in other debts, wants to replace her $60,000 annual income for 15 years, and estimates $100,000 for her child's future education.
- 2 Mortgage: $200,000 + Debts: $15,000 + Income Replacement: ($60,000 * 15 years) = $900,000 + Education: $100,000 = $1,215,000
- 3 Based on these inputs, Sarah needs approximately $1,215,000 in life insurance coverage.
- 4 This coverage would allow her family to pay off the mortgage, eliminate other debts, provide a substantial income replacement period, and cover her child's education, ensuring their financial stability.
Source: CDC · Last updated: April 2026
Frequently Asked Questions
How much life insurance do I need?
Is term or whole life insurance better?
Do I need life insurance if I am single with no kids?
You might also need
HSA Calculator 2026 — Contribution Limits & Triple Tax Savings
Calculate HSA tax savings, investment growth, and projected balance at retirement. See the triple tax advantage in action. Based on 2026 IRS contribution limits.
BMI Calculator — Body Mass Index, Category & Healthy Range
Calculate your Body Mass Index (BMI) from height and weight. See your BMI category, healthy weight range, and what it means. Free, instant results with chart.
Calorie Calculator (TDEE)
Calculate daily calories for maintenance, weight loss, or gain using the Mifflin-St Jeor equation and your activity level.