What to remember
- The DIME method adds four needs: debts, years of income to replace, mortgage balance and future education costs.
- Subtract savings and any coverage you already have, such as a policy through work.
- Stay-at-home parents need coverage too, because replacing childcare and household work costs real money.
- Recheck the number after a marriage, a new baby, a home purchase or a big raise.
In this article
Quick context
- 40% of U.S. adults, about 100 million people, say they need more life insurance
- Only 51% of adults aged 18 to 75 own any life insurance
Life Happens and LIMRA, 2025 Insurance Barometer Study.
How much life insurance do I need is really a question about what your family would have to pay for without you, and for how long.
The calculator below uses the DIME approach. Fill in your own numbers; nothing is stored or sent anywhere.
How much life insurance do I need? Try the calculator
The DIME method, step by step
- Debt. Add credit cards, auto loans, personal loans and any other balances that would fall on your family. Include an estimate for final expenses.
- Income. Multiply your yearly take-home pay by the number of years your family would need support, often until the youngest child is grown.
- Mortgage. Use the remaining balance, or the rent your family would need if you do not own.
- Education. Estimate what you hope to cover for each child after high school.
Then subtract savings, investments and existing life insurance. What is left is the coverage gap.
Turn your number into a quote
SponsoredRules of thumb vs a real calculation
MythTen times your income is always enough.
FactA household with a big mortgage and three young kids may need much more. A couple with a paid-off home and grown children may need far less.
MythCoverage through work is all I need.
FactGroup policies are often a multiple of salary and usually end if you leave the job. Count it, but do not rely on it alone.
MythOnly the main earner needs a policy.
FactIf a stay-at-home parent died, the family would have to pay for childcare, transport and household help.
Watch the number change
Andre and Priya, both 38
Andre earns $70,000 after tax. They owe $18,000 on two vehicles, $240,000 on the house, and want $60,000 set aside for their daughter.
Replacing 12 years of income comes to $840,000. Add the debts, mortgage and education and the total is $1,158,000. Andre has $100,000 through work and $40,000 in savings, so the gap is about $1,018,000. A $1 million, 20-year term policy closes almost all of it.
Illustrative example. Names and numbers are made up to show how it works.
Price the amount you just calculated
Add your ZIP code to see term, whole life and final expense options offered where you live. You can look without committing to anything.
When to run the numbers again
- β Marriage or divorce
- β A new baby or adoption
- β Buying a home or refinancing
- β A big change in income
- β Paying off a large debt
- β Children finishing school
Frequently asked questions
Is $500,000 of life insurance enough?
It depends on your debts, income and how long your family would need support. Use the DIME calculator above to see whether $500,000 closes your gap.
How much life insurance does a stay-at-home parent need?
Estimate what it would cost to replace childcare, school runs, cooking and household work for the years your children need it, then add any shared debts.
Should I include my mortgage in my life insurance?
If you want your family to stay in the home without the payment, yes. Many people size a term policy to match the years left on the mortgage.
Does the calculator store my information?
No. The numbers stay in your browser and are not sent to us or anyone else.
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