Guide
How much life insurance do you need?
A tool and the logic that supports it: how many years of earnings to replace, what you owe, schooling costs, and what you have already put aside.
The standard approach is to add up what your paychecks could have provided and then subtract anything you already have saved up for or protected. This math does not have to be exact, and it does not need to be: policies are sold in round dollar amounts anyway, and the real goal is a number that would maintain your family's stability through the critical years.
Coverage estimate
Formula: (annual income × number of years) + total debts + education allowance − existing savings and coverage, rounded up to the nearest $5,000. This is your starting point, not a recommendation.
Why those inputs
Income years. Planners typically use a range of ten to twenty years; the exact choice hinges on how long your dependents will require financial help. Households with little kids in the Chino Hills area frequently go with the twenty-year option because childcare, housing payments, and school expenses tend to all be heaviest at the same time.
Debts. For most households, a mortgage is the biggest one. Coverage in the amount of that balance gives your family the choice of staying in the home without being forced out by money problems.
Education. Set aside a rough estimate per child, in current dollars. It is less work to include this now than to buy another policy later to cover it.
What you have. Cash in savings that could pay for things, plus coverage that comes through your employer. Since employer coverage generally ends when you leave the job, most people only count a fraction of it.
Once you have figured out your number, the quoting tool lets you see what each carrier charges for that amount over a 10, 15, 20, 25, or 30 year period. Many people choose slightly more coverage than the calculation suggests because the cost per month is quite low when you are younger.