How much life insurance do I need?
The amount of life insurance a person needs will depend on their own particular circumstances and the reasons for purchasing the policy.
One approach to determine how much life insurance you should purchase is to analyze the various needs of your family in the event of the death of a family member. Life insurance may satisfy a number of these needs by providing a fund that can be used to Pay off an individual’s last debts such as medical bills and funeral expenses;
Meet estate taxes and other expenses in settling an estate;
Provide life income for the spouse;
Pay off a mortgage; Pay for the children’s education;
Provide funds for retirement;
Provide an income for the policyholder’s spouse to give the family time to readjust to a new standard of living;
Draw interest to provide funds for some special purpose; or
Provide a monthly income until the children are grown and out of school.
Thus, the current and future financial needs particular to your family can be a significant consideration in determining the amount of life insurance that is right for you. Another factor that may be taken into consideration in determining how much life insurance you need is the amount of your annual salar
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