🛡️ Life Insurance Calculator
"How much life insurance do I need?" is the question almost everyone asks — and guesses at. Too little leaves your family exposed; too much means paying for cover you will never use. This calculator replaces the guess with the standard needs method used by financial planners.
Add up what your family would actually need — income replaced for a number of years, the mortgage and debts cleared, education funded, final expenses covered — then subtract the insurance and savings you already have. The result is the cover gap worth insuring.
How to use this calculator
Enter your income and what your family would need, then press Calculate.
- Enter your annual income and how many years of it your family would need replaced.
- Add your mortgage balance, other debts, expected education costs and final expenses.
- Enter any life insurance you already have, plus savings and investments your family could use.
- Press Calculate to see the cover you need and how the total is built up.
How the Needs Method Works
Planners often remember it as DIME: Debts you would want cleared, Income your family would need replaced (commonly 10–15 years), the Mortgage paid off so they can stay in the home, and Education for the children. Against that total you set what already exists — current policies, including any employer cover, and savings that could realistically be used.
The "years of income" choice drives the answer more than anything else. Young children and a non-working spouse argue for more years; older children and a working spouse argue for fewer. Rules of thumb like "10× your salary" are a rough shortcut of the same idea — this calculator simply shows the working, so you can adjust the parts that do not fit your life.
Frequently asked questions
How much life insurance do I actually need?
Enough to replace your income for the years your family depends on it, clear the mortgage and other debts, fund education you plan to pay for, and cover final expenses — minus cover and savings already in place. For many families that lands between 10 and 15 times annual income.
What is the DIME method?
DIME stands for Debts, Income, Mortgage and Education — the four needs a policy should cover. Add them up, subtract existing cover and usable savings, and the remainder is the amount worth insuring.
Should I count my employer life insurance?
Yes — include it in "life insurance you already have". Just remember it usually ends when you leave the job, so many people hold personal cover as well and count employer cover as a bonus rather than the foundation.
Is term or whole life better?
Term insurance covers a set number of years and is far cheaper per unit of cover, which suits the needs calculated here — debts and children do not last forever. Whole life lasts your entire life and costs much more. This calculator estimates the amount of cover, whichever type you choose.