Rate Retriever Logo

How much Life Insurance coverage do I need?

To keep it simple, a lot of insurance carriers recommend that your coverage be at least 10 times your income if you’re near retirement. At a younger age, you may need additional coverage. For example, if you are under 40, you may want to consider up to 30x your current income.   

However, this recommendation doesn’t take into consideration other beneficiaries and dependents. The amount of coverage you need will be unique to your situation and goals. To determine how much coverage you need, think about your financial obligations, including debt and income replacement.  

To be matched with the right type of Life Insurance policy for you based on your personalized profile, take our quiz here. 

The DIME method

One way to estimate how much life insurance you need is to use the DIME formula. DIME is an acronym that stands for Debt, Income, Mortgage, and Education. The DIME formula is especially useful because it accounts for other financial obligations you may have when determining how much life insurance you may need.  

Debt and final expenses

Add up your debts, other than your mortgage, plus an estimate of your funeral expenses.


Decide for how many years your family would need support, and multiply your annual income by that number.


Calculate the amount you need to pay off your mortgage.


Estimate the cost of sending your kids to school and college.

After adding up the expenses, you should subtract any existing savings or life insurance coverage you already have.  

This method gives a well-rounded view of the financial obligations you should consider when determining your life insurance coverage.  

Life insurance: part of your financial plan

Life insurance should be a part of your personal and family’s financial plan. To choose the right amount of coverage, be sure to consider the future growth of your assets and income, as well as future expenses including education costs and other needs of your dependents.

Your goals and budget will determine how much risk you can afford to take off the table by purchasing life insurance.  

Regardless of what happens to you, life insurance allows your family’s financial outlook to remain the same. Life insurance gives you and your family peace of mind that they will always have the financial support they need should anything happen to you.  

Still unsure of how much coverage you should select?

Use our personalized quiz to see what options are best for you based on your profile. 

"*" indicates required fields

Zip code*
Zip code
What is your gender?*
Do you smoke?*

Why Rate Retriever?

Big savings

Save time and money by comparing quotes from top life insurance providers

No spam

We’ll never sell your personal information, so you won’t get calls or emails you didn’t ask for

Personalized results

Choose from a custom list of best matches based on your answers to our short quiz