We see a lot of ‘ballpark’ life insurance coverage when we work with clients on their financial plans. They might say, “I have two times my salary at work.” Is ‘two times’ enough? Too much? Is a workplace policy even what you need?
A comprehensive financial plan tailored to you will answer those questions, as there is no rule of thumb reply- it is a family by family decision that we help our clients to answer by looking at their expenses, their resources, and their risks to determine what coverage they should have in place, and whether it fits in their budget. Life insurance is so ingrained in our senses that some of our clients think they need it well after they are financially independent, but remember that the reason to have any insurance in your financial plan is because you have a risk. Once the risk is gone – specifically as clients accumulate money and become financially independent – we have to question if the policy still has value.
Simply put, there are many variables and many questions to answer. You can start for yourself by testing your life insurance know-how.