Life Insurance Calculator

Getting started with life insurance can be overwhelming. For most individuals, the question they ask themselves after whether or not they need life insurance, is how much. Most people underestimate how much life insurance they need. In addition they overestimate the cost by 200%.
Author: Brian Greenberg CEO of True Blue Life Insurance
Last updated: June 23, 2021

Our calculator is here to make things easier for you. Based on your age, income, debt, and assets, we will show your recommended and maximum life insurance coverage. Once your coverage amount is calculated, you can compare rates from the best providers in less than 60 seconds.

How much life insurance do I need?

Our easy to use life insurance calculator will use your annual income to calculate the minimum, recommended and maximum life insurance coverage you need.

What is your age?
What is your annual income?

This includes everything from your yearly salary to overtime, tips and commissions earned.

Estimate your assets and equity:

Think checking, savings and other financial accounts, as well as property, equity, personal possessions.

How much debt do you have?

Think mortgage, vehicles, credit card debt.

Do you want to provide extra money to your dependents?

Think funeral costs (average funeral is $7,000), education (average cost for college is roughly $3,500 to $36,000 per year), or any other extra’s.

Select how much coverage you want:
Here's how much coverage you need:
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How equity and assets affect how much life insurance you need

While calculating how much coverage you need, it’s important to consider how much is already covered. Think savings, stock and other investment accounts, equity, and assets. All of these will become available to your spouse or dependents in the case of your death. They can be used as income replacement, or to pay-off debt and final expenses. So, don’t hesitate to deduct this amount from the coverage you need. After all, less coverage equals a lower premium.

How age affects life insurance coverage

As you grow older, the amount of life insurance you can get will decrease. At the same time, the cost of life insurance will only increase. Your age helps us to determine the recommended and maximum amount of life insurance available to you.

How much life insurance we recommend by age

AgeRecommendedMaximum
40 and under15 x annual income20 x annual income
5010 x annual income15 x annual income
607 x annual income10 x annual income
65 and older5 x annual income7 x annual income

How annual income affects how much life insurance you need

People buy life insurance for various reasons. For people ages 30-50, the main reason is income replacement. If you are responsible for most of the family’s income, your loss can have a tremendous financial impact. Can your family continue paying the mortgage, or vehicle loans, without your income?

Our calculator will use your age to recommend a certain annual income multiple. For example, if you are 30 and the main provider, we would recommend multiplying your annual income by 15. This is, of course, a rough estimate since we do not know your personal situation. 15 years could be excessive in some cases, while in others it may not be enough.

How debt affects how much life insurance you need

Like the loss of income, debt can have a huge financial impact on the lives of your loved ones. If you have a mortgage or car loan payments, that burden will fall on the shoulders of your loved ones. If they can’t make the payment, they may face foreclosure or repossession.

While some personal debt may go away upon your death, there are exceptions that vary state by state. Some exceptions are:

  • Loans with a co-signer. The co-signer would be financially responsible for the remaining loan balance.
  • Credit card debt with a joint account holder. The joint account holder would be responsible for the outstanding credit card balance.
  • Community property states require the surviving spouse to use “all assets acquired during the marriage” to pay off the debt of the deceased.

Common life insurance coverage questions

How much life insurance do I need after age 55?

When you reach age 55, your children are typically out the door and you may wonder if you still need that high coverage policy, or perhaps you’re finally considering to get life insurance. In order to help you estimate how much life insurance you need, we recommend considering the following 4 things to see which are important to you: income replacement, debt, inheritance, and final expenses.

Income replacement: this will ensure your financial dependents can continue living the same lifestyle they are used to. For ages 50-60, we recommend multiplying your annual income by 10.

Debt: Some personal debt will be forgiven upon your death. However, if you owe on your home, vehicles, joint credit cards or loans, your dependents will become responsible. This can lead to huge financial consequences. Think foreclosure on your home, or repossession of your vehicle(s). This can be prevented with a life insurance policy. Not only will your debt be paid in full, but your dependents would also save thousands in interest.

Inheritance: life insurance doesn’t have to be a means to replace income, or cover debt. Perhaps you simply want to leave your children or grandchildren a lump-sum of tax-free cash. With life insurance, you could leave a larger inheritance than you otherwise could by simply saving money.

Final expenses: the average funeral cost is between $7,000 and $10,000. Final expense life insurance can be an affordable way to cover this cost and prevent a financial burden on your spouse or children. It’s common for people aged 65 and older to simply get enough coverage for funeral costs.

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About the author
Brian Greenberg author
Brian Greenberg
Founder and CEO
Brian is licensed to sell life, health, annuities, and property and casualty insurance in all 50 U.S. states. He is the author of The Salesman Who Doesn't Sell and is a member of the Million Dollar Round Table, an organization that consists of the top 1% of financial advisors worldwide.