Life insurance is one of the most secure ways to ensure your family’s financial stability. It can ensure lifestyle continuity for your family even in your absence. Thus, it becomes critical to select the right amount of coverage. At Choice 1 Insurance Agency in New Richmond, WI, our independent agents can guide you in determining the appropriate type and amount of life insurance coverage for you.
The life insurance amount you need is a personal decision based on several factors about you and your dependents. Questions you need to consider include: How many people rely on your income? Are these figures likely to change? For how long will you need to provide for them? Do you have outstanding debts like a mortgage? Such factors affect the amount of life insurance needed.
Term life insurance can be a more economical choice to secure larger life insurance amounts. You’ll need to determine the term that will provide the required coverage. Typically, it is estimated that you should have life insurance amounting to ten years of your income, plus $100,000 per child for their education. The required amount should also cover your mortgage.
If you have very young children, you may need coverage for more than ten years of your income. For instance, if you earn $100,000 annually, have a $400,000 mortgage, and have three children, you would need around a million dollars for income replacement, $300,000 for education, and $400,000 for the mortgage. This totals $1,700,000. Rounding that figure up to $2,000,000 can provide a safety margin.
Our agents at Choice 1 Insurance Agency in New Richmond, WI, can provide comprehensive information to help you make a decision about your life insurance needs.
