Life Insurance Needs Calculator
How much life insurance you need — DIME method (Debt, Income, Mortgage, Education).
Life insurance you should carry (DIME method)
$1,155,000
DIME = Debt + Income (× years to replace) + Mortgage + Education + final Expenses.
How the DIME total breaks down.
👉 See coverage guidance and typical cost by age: life insurance by age — estimated coverage, suggested term length, and a rough monthly premium for ages 20 to 70.
The hardest part of buying life insurance isn’t the policy — it’s deciding how much. Too little leaves your family short; too much wastes money on premiums. This calculator uses the proven DIME method to translate your real obligations into a coverage number.
DIME stands for Debt, Income, Mortgage, and Education — the four things your income currently covers that would still need paying if you were gone. Add them up, subtract savings and existing coverage, and you get a defensible target.
How this calculator works
DIME sums four buckets: Debt (credit cards, car loans, and final expenses), Income (your annual income times the number of years your family needs support, often 10–15), Mortgage (the remaining balance so the home is secure), and Education (projected cost for each child). The calculator totals these and subtracts current savings and any coverage you already have, leaving the gap a new policy should fill.
What affects the number
- Income replacement years — how long your dependents need support (more years = more coverage)
- Remaining mortgage and other debts you’d want cleared
- Number and ages of children, and whether you’re funding college
- Existing life insurance (employer group + individual) and liquid savings
- A surviving partner’s own income and earning ability
Frequently asked questions
How much life insurance do I need?
A common rule is 10–15× your annual income, but the DIME method is more accurate because it counts your actual debts, mortgage, and education costs. Use the calculator above for a number based on your situation, not a rule of thumb.
What is the DIME method?
DIME = Debt + Income + Mortgage + Education. You add those obligations, then subtract savings and existing coverage. It’s a fast, widely used way to size a policy around what your family would actually need.
Is term or whole life better for most people?
For most families, term life covers the years you have dependents and a mortgage at a fraction of the cost of whole life. Whole life suits specific estate or lifelong-dependent needs. See our Term vs Whole Life calculator to compare costs.
Does my employer life insurance count?
Partly. Employer group coverage is usually only 1–2× salary and ends when you leave the job, so most people need an individual policy on top. Subtract it from your DIME total to find the gap.
This calculator provides general estimates for educational purposes only and is not insurance advice or a quote. Your actual rates and coverage needs depend on your specific situation and insurer.