You need to do a need analysis in order to determine that magic number. Each person has different needs and goals. Your life insurance can be a benefit while you are living, while helping support way of life after you leave or it could be basic and just cover your burial expenses.
I work with Allstate and we look at your whole picture to help you determine what is an appropriate amount to complete those needs and goals.
When determining how much life insurance a person should purchase there are a number of things to first consider. First, are you attempting to protect assets? Next, are you looking to make sure your spouse is not left with burial expenses, mortgage payments, car payments and other debts? Life insurance is an effective way to make sure these issues are dealt with so that a spouse and/or children are not left accumulating the debts.
This depends on your need. Based upon income and age, insurance companies will only allow you to purchase up to a certain number of times your income. I do a needs analysis and an available funds analysis to make that determination. However, it also depends upon what the person wants to do with it. Life insurance is no longer just about paying out upon death. Many allow income for life and income in the event of a chronic, critical or terminal illness. The companies I work with have no extra charge for this. Frequently, I use an Indexed Universal Life policy for income later and a term for the living benefits if needed. This way the IUL can be preserved for a sustainable income since it is designed to build cash value.
I like to look at life insurance as not what it is but what it does. Life insurance assures the beneficiary and ones left behind that they can continue life in a comfortable manner even though the loved one is no longer present. A needs analysis is certainty done during the visit to address adequate coverage that would best fit their budget and to leave the client knowing that after the critical period of the loss of their love one, the family can carry on with a normal lifestyle.
It depends on each persons situation in life mainly their age. Symmetry Financial Group works with thirteen carriers to customize a plan to meet each customers needs. We even have indexed annuities to protect against market downturns. An older couple may just need a final expense plan. A younger couple can benefit from an Indexed Universal Life plan.
There are so many answers, but the important thing is the questions- are there children, what are your financial goals for you and them. how much would you insure your wife for? if you didn't come home last night, what would happen? Is the house paid for? would the family have to move? Would there be enough income for the family until the kids are in school full time? Whats your age? Wife, kids? This needs to be a good discussion to review everything. What insurance do you have now? Thats why we are professionals- we need to discuss all these issues and concerns. The old calculation of 7 to 10 times your income doesn't work these days-too many variables.
I tend to focus on customer's needs/budget...IF money was no object how much coverage would you need to leave your loved ones in a position to function without you. I factor in child's education, daycare, health insurance, mortgage, debt, loss of income, etc. Then we look at what they can afford. I use myself a single momma as an example... I went with term coverage to give my family time to sell or pay off my car & home depending on the age of my son. If they sold, how much money would my brother need to get a bigger apartment to house my son, pay for his education & medical expenses...since my budget was based on my wages (dead beat ex) I took what I could afford. I also picked up a whole life policy to pay for my final expenses. Since cancer & diabetes runs in my family I picked up 2 paid in full life policies for my son. He will have the option to add to it when he marries as well as when he has kids (locked in his insurability). None of us are promised tomorrow and I have watched my extended family suffer because no one mentioned the need for life/disability insurance. So IF money was no object vs what they can budget works well for me. Good luck!
There is So Much Misinformation when it comes to Life, Disability, Health, and Long Term Care Insurance.
Most of this misinformation comes from the fact that many insurance agents are dealing with their clients in a "transactional" manner, to get their quick commission and move on to the next policy ...
They just don't take the time to properly understand "the foundation" based on which the life insurance (or, any other type of insurance) should be built upon. Like in the case of any building, if The Foundation is "solid & sound," you can add as many levels as you want, as needed...
Also, factors such as your income, your spouse's income, your immediate familiy's medical history, your spouse's family medical history, your short and long-term goals, the value of your mortgage, the amount needed for your children's education, any special needs expenses, etc., are just a few of the factors that will have to be accounted for, in properly designing a life insurance policy ...
Business from Tampa, FL
Answered on Apr 17th, 2018
I recommend 10x the annual income as rule of thumb. Term Insurance only.
Example : Age:30
Term 35 years
Monthly income$4,000
Annual income $48,000
Income protection $480,000
The Premium will depend of the age , gender and health condition of the applicant.
Let me know if you need more information. You can call me anytime.
Thanks
Juan
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Answers (41-50)
Life Insurance should be based on ones personal goals
A simple rule would be 10-12x their annual income
One could stack different term policies and UL or Whole life options
7-pay plans are nice too
You need to do a need analysis in order to determine that magic number. Each person has different needs and goals. Your life insurance can be a benefit while you are living, while helping support way of life after you leave or it could be basic and just cover your burial expenses.
I work with Allstate and we look at your whole picture to help you determine what is an appropriate amount to complete those needs and goals.
When determining how much life insurance a person should purchase there are a number of things to first consider. First, are you attempting to protect assets? Next, are you looking to make sure your spouse is not left with burial expenses, mortgage payments, car payments and other debts? Life insurance is an effective way to make sure these issues are dealt with so that a spouse and/or children are not left accumulating the debts.
This depends on your need. Based upon income and age, insurance companies will only allow you to purchase up to a certain number of times your income. I do a needs analysis and an available funds analysis to make that determination. However, it also depends upon what the person wants to do with it. Life insurance is no longer just about paying out upon death. Many allow income for life and income in the event of a chronic, critical or terminal illness. The companies I work with have no extra charge for this. Frequently, I use an Indexed Universal Life policy for income later and a term for the living benefits if needed. This way the IUL can be preserved for a sustainable income since it is designed to build cash value.
It depends on each persons situation in life mainly their age. Symmetry Financial Group works with thirteen carriers to customize a plan to meet each customers needs. We even have indexed annuities to protect against market downturns. An older couple may just need a final expense plan. A younger couple can benefit from an Indexed Universal Life plan.
There are so many answers, but the important thing is the questions- are there children, what are your financial goals for you and them. how much would you insure your wife for? if you didn't come home last night, what would happen? Is the house paid for? would the family have to move? Would there be enough income for the family until the kids are in school full time? Whats your age? Wife, kids? This needs to be a good discussion to review everything. What insurance do you have now? Thats why we are professionals- we need to discuss all these issues and concerns. The old calculation of 7 to 10 times your income doesn't work these days-too many variables.
I tend to focus on customer's needs/budget...IF money was no object how much coverage would you need to leave your loved ones in a position to function without you. I factor in child's education, daycare, health insurance, mortgage, debt, loss of income, etc. Then we look at what they can afford. I use myself a single momma as an example... I went with term coverage to give my family time to sell or pay off my car & home depending on the age of my son. If they sold, how much money would my brother need to get a bigger apartment to house my son, pay for his education & medical expenses...since my budget was based on my wages (dead beat ex) I took what I could afford. I also picked up a whole life policy to pay for my final expenses. Since cancer & diabetes runs in my family I picked up 2 paid in full life policies for my son. He will have the option to add to it when he marries as well as when he has kids (locked in his insurability). None of us are promised tomorrow and I have watched my extended family suffer because no one mentioned the need for life/disability insurance. So IF money was no object vs what they can budget works well for me. Good luck!
There is So Much Misinformation when it comes to Life, Disability, Health, and Long Term Care Insurance.
Most of this misinformation comes from the fact that many insurance agents are dealing with their clients in a "transactional" manner, to get their quick commission and move on to the next policy ...
They just don't take the time to properly understand "the foundation" based on which the life insurance (or, any other type of insurance) should be built upon. Like in the case of any building, if The Foundation is "solid & sound," you can add as many levels as you want, as needed...
Also, factors such as your income, your spouse's income, your immediate familiy's medical history, your spouse's family medical history, your short and long-term goals, the value of your mortgage, the amount needed for your children's education, any special needs expenses, etc., are just a few of the factors that will have to be accounted for, in properly designing a life insurance policy ...
I recommend 10x the annual income as rule of thumb. Term Insurance only.
Example : Age:30
Term 35 years
Monthly income$4,000
Annual income $48,000
Income protection $480,000
The Premium will depend of the age , gender and health condition of the applicant.
Let me know if you need more information. You can call me anytime.
Thanks
Juan