What matters isn't actually the amount of insurance coverage you need, it is how much money your loved ones will likely need after that you are gone.

Ask yourself:

How much money will my loved ones need after my death based on immediate costs,for instance funeral bills as well as financial obligations?

How much cash will my household need to sustain their particular standard of living during the long run?

Life insurance proceeds can help pay out prompt bills including uncovered healthcare expenses, funeral service expenses, final estate settlement bills, taxes along with other lump-sum obligations such as unpaid financial obligations and mortgage loan balances. They could also help your household handle long term obligations like everyday living costs, income for higher education as well as your spouse's retirement, and a lot.

But how will you find out if you require $100,000, $500,000, $1 million or more? The easiest way to determine your insurance needs is by conducting what's known as a Capital Needs Analysis.

Here's the way it operates. Begin by evaluating your family's needs. Gather your complete private financial details and estimate what your each of your family members would need to meet current and future financial obligations. Then tally up all of the resources that your surviving family members may draw upon to support themselves. The difference between their needs plus the resources in place to fulfill those needs is your need for additional life insurance coverage (see diagram below).

This may look simple enough, but calculating one's life insurance coverage needs can actually get pretty complicated. So it will be easy for you to get a general sense of your needs, check out ING's "When should I buy a life insurance policy and how much do I need?" video. It'll take you step-by-step through the task and present you with an estimate of your insurance needs in a matter of minutes.

But remember, our calculator (or anyone else's for that matter) isn't any replacement for the guidance and assistance you'll get by meeting with a professional broker or other financial professional. So if you're seriously interested in protecting your family's future, contact an insurance professional in your community.