The Simple Way I Tell People to Figure Out If They Need Life Insurance (and How Much)

I was in this exact spot years ago. My wife was a stay-at-home mom, I was the only one working, and we had two young boys. There was no debate — I needed coverage, and if you're a parent with young kids and a working income, neither do you. 

Keep It Simple: Choose Term 

For the vast majority of families, term life insurance is the right answer. It covers you for a set period — 20 or 30 years — at a low, fixed cost. 

Whole life and universal life mix insurance with investing, and in most cases, the only person who really serves is the salesperson. My advice: buy simple term coverage, and if you want to invest, do it yourself in your own investment account. Don't get talked into a complicated product you don't need. 

Do the Math on How Much Coverage You Need 

A common guideline is roughly 10 to 12 times your annual income. If you make $50,000 a year, that puts you somewhere between $500,000 and $600,000 of coverage. 

You can also build the number from your real needs: 

• Years of income you'd want to replace 

• Remaining mortgage balance 

• Future education costs for your kids 

• Any other debts you'd want cleared 

Add it up. That total is your honest coverage target. This isn't the place to scrimp — it's better to be adequately covered than to leave your family short. 

Lock In Your Rate While You're Young and Healthy 

This is the part people miss: you buy life insurance with your health, and health is cheapest when you're young. Rates only climb as you get older, and a future diagnosis can make coverage far more expensive, or unavailable altogether. 

I bought a 20-year level term policy when I was healthy, and locking in that rate early protected it for decades. A healthy 36-year-old can often get substantial coverage for a modest monthly cost — don't wait for a "perfect time" that only makes the price go up. 

Buy From a Solid Company and Move On 

Once you know your number, get a few quotes from highly rated, financially strong insurers. Simple, level term from a reputable company covers what most families actually need. Name your beneficiaries clearly, revisit the policy every few years as life changes, then let it be. Your family is covered — you can stop worrying. 

Life Insurance Is Love Made Practical 

I understand the fear behind putting this off. Thinking about it means picturing a world without you in it — I've felt that same discomfort myself. But planning for your family isn't a lack of faith. It's an act of love. 

1 Timothy 5:8 puts it plainly: those who don't provide for their household have denied the faith. Providing isn't only for today — it's planning wisely for the people you're responsible for, even for a day you hope you'll never see. 

Today's Win: Land on Your Number 

You don't have to buy a policy today. Just calculate your coverage target: 

1. Take your annual income and multiply it by 10, then by 12, for a range. 

2. Add any major upcoming costs — mortgage balance, education expenses. 

3. That's the real number to shop with. 

You can't shop wisely until you know what you're shopping for. 

The Bottom Line 

If someone depends on you, life insurance isn't optional — it's protection for the people you love. Keep it simple with term, do the math on how much you actually need, lock in your rate while you're healthy, and buy from a solid company. One decision this month can protect your family for decades. 

Facing a financial decision of your own? I'd love to hear about it. Submit a question at financiallyconfidentchristian.com/question, or leave a voicemail at financiallyconfidentchristian.com/voicemail.