How Much Is Enough?
Wednesday, August 16th, 2006Do you need life insurance and if you do, how much coverage is enough — these are questions that every person who’s taking out a life insurance policy for the first time, asks. Every situation is different. The answer depends on your income, savings, lifestyle — to name a few things. But there is a rule of thumb — Financial professionals generally advise that your coverage equals eight to 10 times your gross annual income. Fortwayne.com reports:
If you are taking care of the children, then you need to figure out how much your surviving spouse would pay each year to have the children looked after. If you are planning to return to work in a few years, you need to calculate your future earnings that your spouse would lose.
Read more: Out of the Red: When duty calls, so does life insurance