To more accurately gauge the amount of coverage you will ultimately need, begin by following these steps.


Add up all of your debts, such as credit cards, mortgages and student loans.

Add in any medical bills, burial costs, estate taxes and attorney fees that may be owed in the event of your death.

Calculate the future education expenses of your children. It can be tricky to figure out how much these expenses will be, especially if your children are young.


Total your everyday expenses, including childcare, medical care, food, clothing, utilities, etc. Figure out what a year's worth of expenses would come to, then determine how many years of expenses you would like to cover.

Take an inventory of any financial assets you may have, such as retirement plans, stocks, bonds, mutual funds and Social Security benefits. Do not include things like your home, automobile, or real estate holdings unless you have decided to sell them in the event of a premature death.


Does your spouse have the ability to return to work or begin a new career? If not, you may wish to have a policy that would carry a higher benefit to help sustain your family over a longer period of time.