How Much Life Insurance Do You Really Need?

Have questions on life insurance? Check out my latest YouTube video below to learn about how much life insurance you actually need!


Video Transcript:

Ben Green Hey folks, Ben green here with Benmgreen.com we're of course, I'm here to optimize your career, your location and your finances in today. This month, it is life insurance Awareness Month. So I do want to bring out a few ideas and a little bit information for you regarding life insurance. A lot of folks asked me, Ben, how much life insurance do I need? How much life insurance Do you need, there are two ways to really kind of calculate it pretty quickly. So the first way is super easy, where you take your annual salary, and you multiply it by seven to 10 times, okay. So for example, if you're making $50,000 a year, the minimum amount of life insurance you need, especially if you have any sort of obligations, like mortgages, kids, anything, student loans, anything along those lines, the minimum amount you need is seven times your annual salary in life insurance. So if you're making $50,000 a year, that's going to be $350,000 per year, all right, the maximum are a good amount to have kind of an overage, if you will to have is 10 times the amount. And so if you're making $50,000 a year, you're going to have half $1,000,000.05 $100,000. In life insurance, that's a really good amount of life insurance to have, especially if you have any sort of obligations. And if you were under like 45 or 50 years old, you can get that for less than 100 $100 a month. If you're like 2025 or 35, you're talking you know, 25 bucks a month, 3040 bucks a month for a half million dollars in life insurance. All right. So that's one really quick way to to to figure out how much life insurance you need seven to 10 times your annual salary. The other way to do it is to add up how much you owe. All right. So for example, if you owe $200,000, in your mortgage, well, you need at least $200,000 in life insurance for that, if you have any sort of student loans, you have 50,000 in student loans, we'll grab 50,000 for that. Alright, so you're we're up to 250,000. Now, and then if you do have any sort of any sort of responsibilities, like kids, for example, you have a spouse you'd like to leave some money to. So they are not broke once you if once in if you pass away, all right, you want to add ideally about you know, three or four times your salary regarding that as well. Alright, so that that's a good way to do it. And then if you have kids, and you want your kids to be taken care of. And then also you want your kids to go go to college, for example that that's, that's something you wish for them to do, you need to add about $150,000 per per child to the estimate, basically. So kind of a quick and dirty way to do it. If you if you have $200,000 and mortgage, you owe $50,000, on some student loans, as 250,000, you made $50,000 per year in salary, you want to get at least three or four times that amount. So now we're up to 250,000 plus about 200,000 in life insurance, and then you have two kids. All right, so you want 150,000 per kid for life insurance for the college. So that's 450 plus 150 plus 150, you're looking at 750,000. To round it out for kids. And just covering the everyday expenses, you probably need about another 100,000 or so per per child in there to get into age 18, for example, and leave some for your spouse, and so forth. So in that instance, you would be looking at about a million dollars in coverage that you need. That may sound like a lot of life insurance. I can guarantee you we've never had anyone any family tell us that their spouse or their significant other had too much life insurance. All right, and you can actually get up to a million dollars in life insurance pretty cheaply, especially through Term Life Insurance, or a combination of term and whole life insurance. So that in a nutshell is really quick way quick and easy way to figure out figure out how much life insurance you need. You can either do seven to 10 times your annual salary. Or you can add up how much you owe. And then add some things in for future obligations like college for the kids. All right. Thank you



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