Guide
How much life insurance do you need?
A tool and the logic supporting it: how to think about income duration, debt elimination, education funding, and resources you currently have in place.
The standard approach is to sum up income replacement needs and then deduct existing protection. Precision is not required here since term policies are purchased in round dollar amounts; the objective is a number that maintains your household's stability through the critical years.
Coverage estimate
Calculation: (Annual income × Years) + Outstanding debts + Education costs − Existing resources, then round to the nearest $5,000. This formula serves as a starting framework only, not professional guidance.
Why those inputs
Income years. Financial advisors typically recommend coverage for 10 to 20 years of income, though the appropriate span varies based on how long dependents would require assistance. Cupertino families with young children frequently lean toward the 20-year option given that childcare, housing, and education expenses all peak simultaneously.
Debts. Mortgage debt is typically the largest obligation. If your coverage would pay it off in full, survivors have the freedom to make their own choice about the home rather than having to sell due to cash constraints.
Education. Include a rough per-child estimate using today's dollars for college costs. Planning it into your coverage now is simpler than adding more insurance down the road.
What you have. Existing liquid savings available for emergencies, plus any group life insurance your employer provides. Since employer coverage typically ends when employment does, many people factor in only a portion of it.
Once you know your target amount, use the quote tool to see what each carrier charges for coverage periods ranging from 10 to 30 years. Many people opt for a slightly higher amount than their calculation because the extra monthly cost is modest when you are younger.