How Much Life Insurance Do You Need?
How much life insurance would it take to replace an income and settle what is owed? Every piece below can be linked to, so it opens in a window on your reader's screen, current as of the record. No form to fill in.
2026 law · Reviewed September 7, 2026 · The full page, with methodology and sources · the terms · All tools
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The income, the years, inflation, the return, debts, final expenses, education, existing coverage, and savings in; the need, its parts as bars, and the rule of thumb beside it out. In a frame it carries no cookies, no tracking, and a visible link back to the methodology. Your site has to allow frames; most do. The link that opens it in a small window is on the professionals page.
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- In plain words.
- Life insurance pays a lump sum. The question is what that sum has to do. This tool values the income your family would need for a chosen number of years as a fund that pays it out, rising each year and earning a return in the meantime. It adds the debts to clear, the final expenses, and an education fund, then subtracts the coverage and savings already there. The result is the new coverage the gap calls for, shown beside the ten-times-income rule of thumb.
- Why it matters.
- Too little coverage leaves a family short in the worst year of their lives; too much costs premiums for decades. The need has parts, and seeing them lets the years, the debts, and what is already in place be argued one at a time.
- An example.
- $100,000 a year for 20 years, rising 3% a year from a fund earning 5%, plus $250,000 of debt, $15,000 of final expenses, and $100,000 for education, less $200,000 of existing coverage and $100,000 of savings: about $1,741,302 of new coverage, against $1,000,000 from the rule of thumb.
- Where it stops.
- Every input is an assumption, and the years and the return on the fund decide most of it. Social Security survivor benefits would reduce the need and are not subtracted. The tool does not model a surviving spouse's own earnings, tax on the fund, or which kind of policy fits, which is a question for an insurance professional.
The facts
Six quotable sentences on sizing life insurance.
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- The amount of life insurance a family needs is what the payout has to do: replace an income for the years it is needed, clear the debts, cover the final expenses, and fund what was promised, less the coverage and savings already in place.
- Replacing the income is the largest piece, and it is a present value: a fund that, invested, pays the income each year, rising with inflation, and is used up at the end of the years. More years or a lower return on the fund make it larger, fast.
- Example: $100,000 a year for 20 years, rising 3% a year from a fund earning 5%, needs about $1,676,302. Add $250,000 of debt, $15,000 of final expenses, and $100,000 for education, subtract $300,000 of existing coverage and savings, and the new coverage needed is about $1,741,302.
- The rule of thumb, 10 times income, gives $1,000,000 for the same family. It ignores the debts, the education, and the number of years, and it can land far from the need in either direction.
- Social Security survivor benefits reduce the need and are not subtracted here. A surviving spouse caring for a young child, and the child, can receive monthly benefits until the child grows up; the survivor tools on this site cover survivors at retirement age.
- The need is not fixed. It falls as the years shrink, the debts are paid, and savings grow, which is why coverage is reviewed every few years rather than bought once. Whether term or permanent insurance fits the number is a different question, and this tool does not answer it.
By the years of income
How the need moves with the years the income must last.
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| Income replaced for | Income fund | All needs | New coverage needed |
|---|---|---|---|
| 10 years | $918,498 | $1,283,498 | $983,498 |
| 15 years | $1,315,603 | $1,680,603 | $1,380,603 |
| 20 years | $1,676,302 | $2,041,302 | $1,741,302 |
| 25 years | $2,003,933 | $2,368,933 | $2,068,933 |
Cite and link.
The clean address, a citation generated from the record so it can never carry a stale review date, and an address for every section so you can point a reader at the exact table or method.
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- Link
- https://consideratecapital.com/tools/how-much-life-insurance
- Citation
- Considerate Capital, "How Much Life Insurance Do You Need?," reviewed September 7, 2026, https://consideratecapital.com/tools/how-much-life-insurance.
Link to a section
- The calculator https://consideratecapital.com/tools/how-much-life-insurance#calculator
- The facts https://consideratecapital.com/tools/how-much-life-insurance#facts
- By the years of income https://consideratecapital.com/tools/how-much-life-insurance#key-numbers
- How the need is built https://consideratecapital.com/tools/how-much-life-insurance#how-it-works
- Methodology https://consideratecapital.com/tools/how-much-life-insurance#methodology
- Revision history https://consideratecapital.com/tools/how-much-life-insurance#revision-history
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