How do I know if I have the right amount of life insurance?

Matthew Anthony
B.A., CFP

This is the most important question to answer when reviewing or planning your insurance needs. The only sure way to know is to think about what financial goals you want to achieve for your surviving family.

Many people place eliminating debt as a priority ie. credit cards, loans, mortgage. Families with children will also often set aside money for future education costs.

Last is determining the amount of capital needed to provide ongoing income for your family.  Because these numbers will be unique to each of us, it is important to take the time to determine what is appropriate for you.

A number of online calculators are available that can give you a good starting point and your financial planner can walk you through a good “needs analysis” to provide you with an appropriate amount of coverage for your situation.

Whether it is income replacement, estate planning, or business succession planning, by defining your financial goals as a starting point, you can easily determine the amount of insurance that is right for you.