Every term life insurance agent has heard it a million times or more. “I don’t need any more insurance. I’m worth more dead than alive.” It might even still get a laugh if the person who was trying to be funny didn’t actually believe it. Putting aside for a moment the rather disturbing idea that your loved ones would actually rather have the life insurance cash benefit than having you around to be with them, let’s take a minute and look at how much you really are worth alive.

Consider your earning potential. You’d be amazed at how much you make over the course of a lifetime. Go ahead and do the math. Of course, the figures will be different for everybody, but it’s fairly simple to calculate. How much money do you make? How many years will you be working?

When you multiply the two together, you get an idea of how much lost earnings your family will suffer if you were to pass away. Of course, this doesn’t even take into account retirement or social security, but that’s OK. Usually this number alone exceeds most people’s term life insurance coverage.

Now, consider what you’re worth to your family emotionally. If you were to die today, would your spouse want to return to work tomorrow? If so, you probably need a marriage counselor, which is unfortunately much more expensive than term life insurance. How much time would you want to give each other “off” if something were to happen to you? Unfortunately, bills will still need to be paid. Insurance benefits can go a long way towards covering these, if you have enough.

Do you want your kids to go to college? Most of us take out loans to cover our kids’ education, but the sad fact is that even the most generous banks (I know, oxymoron, right?) don’t loan money to dead people. This leaves the entire burden on your spouse or your kids. No one wants that. Factor in what your kids’ education is going to cost. Make sure you have enough coverage to pay for it.

Even if you’re a home maker, you have economic value to your family. Who would stay with the kids if you were gone? Child care costs money, and that should be considered when looking at how much insurance you need.

These are just the simple things that every family needs to concern itself with. The truth is that every family’s situation is unique, and you should discuss your individual needs with a qualified and trusted agent who can help you determine how much coverage is appropriate for you.

Photo via reynolds.james.e