For many consumers, life insurance is intended to maintain their beneficiaries’ lifestyles upon the death. Replacing a percentage of our income upon death ensures that our beneficiaries continue to maintain their standard of living. The following calculator determines the amount required to replace that income and is used to estimate the amount of life insurance you may need. The calculator is predicated on two questions:
- How much of your income does your family need to live on?
- If you passed tomorrow, how long would your family need that income for?
We recommend that you try different scenarios in order to get a sense of a range of coverage amounts.
Based on the above assumptions, you need approximately $670,520 of life insurance to produce an income of $40,000 for 20 years.
| Year | Insurance | - Income | + Interest | = Remaining Insurance |
|---|---|---|---|---|
| 1 | 670,520.91 | 40,000.00 | 31,526.05 | 662,046.95 |
| 2 | 662,046.95 | 41,200.00 | 31,042.35 | 651,889.30 |
| 3 | 651,889.30 | 42,436.00 | 30,472.67 | 639,925.97 |
| 4 | 639,925.97 | 43,709.08 | 29,810.84 | 626,027.73 |
| 5 | 626,027.73 | 45,020.35 | 29,050.37 | 610,057.75 |
| 6 | 610,057.75 | 46,370.96 | 28,184.34 | 591,871.12 |
| 7 | 591,871.12 | 47,762.09 | 27,205.45 | 571,314.48 |
| 8 | 571,314.48 | 49,194.95 | 26,105.98 | 548,225.51 |
| 9 | 548,225.51 | 50,670.80 | 24,877.74 | 522,432.44 |
| 10 | 522,432.44 | 52,190.93 | 23,512.08 | 493,753.59 |
| 11 | 493,753.59 | 53,756.66 | 21,999.85 | 461,996.78 |
| 12 | 461,996.78 | 55,369.35 | 20,331.37 | 426,958.79 |
| 13 | 426,958.79 | 57,030.44 | 18,496.42 | 388,424.78 |
| 14 | 388,424.78 | 58,741.35 | 16,484.17 | 346,167.60 |
| 15 | 346,167.60 | 60,503.59 | 14,283.20 | 299,947.21 |
| 16 | 299,947.21 | 62,318.70 | 11,881.43 | 249,509.94 |
| 17 | 249,509.94 | 64,188.26 | 9,266.08 | 194,587.77 |
| 18 | 194,587.77 | 66,113.91 | 6,423.69 | 134,897.55 |
| 19 | 134,897.55 | 68,097.32 | 3,340.01 | 70,140.24 |
| 20 | 70,140.24 | 70,140.24 | 0.00 | 0.00 |
