How Do I Calculate How Much Life Insurance I Need? 
The conventional approach is to go through a `` needs analysis '' . This method attempts to determine the minimum acceptable amount of coverage you `` need '' in order to meet your stated objectives , such as final expenses , college costs , mortgage payoff , emergency fund , etc. . It is a math calculation based on your estimate of variables such as inflation , taxes , and rate of return . A more meaningful approach is to simply decide how much of your income you want to continue to your family when you die and for how long . After all , it 's your income that ultimately pays for all the individual items mentioned above . Then , an amount of coverage can be calculated based on the same assumptions as in the needs analysis . 