If you are thinking about purchasing life insurance, you may be questioning how much life insurance you need. The amount of term life insurance  that may be needed will typically depend upon your reasons for purchasing a life insurance policy as well as your current situation.

A way to determine how much term life insurance is needed might be to take into consideration what your family will need if you were to pass away prematurely. Term life insurance might be able to provide for your beneficiaries by meeting their needs. It may be able to provide them funds for:

* A lifetime of income to support your spouse.

* A retirement fund for your spouse.

* An adequate income to give your family time to adjust to a new standard of life without you and your income.

* A monthly income for your children until they are able to live on their own.

The funds from a term life insurance policy might also provide your family funds to help:

* Pay off debts, such as medical costs, funeral expenses, health care costs and so forth.

* Pay for estate taxes and other expenses related to settling an estate.

* Pay off an existing mortgage on your home.

* Pay for your child’s college education.

* Receive interest to provide money for special needs such as travel, education or medical costs.

The financial needs of your family in the future might be a major consideration in deciding how much life insurance you need.

Another contributing factor is typically the amount of your annual salary. You can refer to “Calculating Life Insurance”  for more information. Along with your salary, you might want to take into consideration your family’s lifestyle, your monthly expenses as well as any financial goals you have for the future, such as college tuition, retirement funding, vacations and living expenses.