There’s no one-size answer, but a few reliable methods get you a realistic number fast. The most thorough is the DIME method our calculator uses; the quickest is a simple income multiple.
Method 1: The DIME method
DIME stands for Debt, Income, Mortgage, Education. You add up the debts your family would face, the income you’d need to replace, the mortgage balance and a fund for your children’s education — then subtract savings and any existing coverage. It’s tailored to your real obligations, which is why advisors favor it.
Method 2: The 10× income rule
A popular shortcut is to buy 10 to 12 times your annual income. It’s fast and better than guessing, but it ignores your specific mortgage, debts and education goals. Use it as a sanity check against the DIME number, not instead of it.
How many years of income should I replace?
This is the biggest lever in any estimate. Common approaches: replace income until your youngest child is 18 (or finished college), or until your spouse reaches retirement age. A 35-year-old parent of a newborn might replace 20+ years; someone whose kids are nearly grown might need far less.
Don’t forget what you already have
Savings, investments and workplace life insurance all reduce what you need to buy. Just remember employer coverage is usually modest (often 1–2× salary) and typically ends when you leave the job, so it’s rarely enough on its own. Plug your numbers into the calculator to see your gap.