Life Insurance—Who Needs It and How Much Coverage?
Who Needs Life Insurance?
If you have young children or someone who depends on you financially, you need life insurance—it's that simple. Life insurance helps ensure that the people who depend on you most will be provided for in the event of your death.
While most single people feel they don't need life insurance because no one depends on them financially, there are exceptions. These include singles who:
- Provide financial support for aging parents or siblings
- May be carrying significant debt that they wouldn't want to pass on to family members who survive them
- Want to guarantee their insurability and lock in low rates while they are young and healthy.
How Much Coverage Do I Need?
One rule of thumb is to buy life insurance equivalent to ten times your gross annual income.
- How much money will my family need after my death to meet immediate expenses like funeral costs and debts?
- How much money will my family need to maintain their standard of living?