How much coverage your family actually needs, using the DIME method
Estimate based on national averages. Your actual premium depends on your insurer, location, and personal details.
| Age | Male | Female |
|---|---|---|
| 30 | $23/mo | $19/mo |
| 35 | $27/mo | $23/mo |
| 40 | $38/mo | $32/mo |
| 45 | $60/mo | $48/mo |
| 50 | $92/mo | $72/mo |
| 55 | $148/mo | $113/mo |
Sample published averages, 2025. Notice the pattern: price roughly doubles every ten years of age, which is the strongest argument for buying while you're young and healthy.
| Letter | What It Covers | Typical Figure |
|---|---|---|
| D — Debt | Card balances, car loans, personal and student loans (not the mortgage) | $10,000 – $30,000 |
| I — Income | Annual income × years your family would need it replaced | 10 × salary |
| M — Mortgage | The remaining balance, so the family keeps the house free and clear | $200,000 – $350,000 |
| E — Education | A college or training fund for each child | $100,000 per child |
Add the four together, then subtract savings, investments, and any life insurance you already carry. What's left is the gap a new policy needs to fill.
Most people guess at their coverage amount, and most guess low. This calculator uses the DIME method instead, the same framework many financial planners use: add up what your family would actually face if your income disappeared tomorrow, then subtract what they'd already have. The result is a coverage target with reasoning behind it, not a round number pulled from the air.
Recommended coverage = Debts + (Income × years to replace) + Mortgage balance + (children × education fund) − savings and investments − existing life insurance. The tool floors the result at zero and rounds to the nearest $1,000. For comparison it also shows the quick 10× income rule, which is fine as a gut check but ignores your actual mortgage, family size, and savings.
Fill in your income and how many years your family would need it replaced. Ten years is a common choice for families with school-age kids; use more if your children are young or your spouse doesn't work. Add your non-mortgage debts, mortgage balance, and an education amount per child, then enter your savings and any coverage you already have, including a group policy through work. The recommendation updates as you type.
A family with $80,000 in income, 10 years to replace, $15,000 in debts, a $250,000 mortgage, and two kids with $100,000 each earmarked for college: the DIME total is $15,000 + $800,000 + $250,000 + $200,000 = $1,265,000. Subtract $50,000 in savings and a $100,000 employer policy, and the recommended coverage is $1,115,000. The 10× income rule would say $800,000 for the same family, which sounds close until you notice it leaves either the mortgage or the college fund unfunded.
Enough to clear your debts, pay off the house, fund the kids' education, and replace your income for as long as your family depends on it. That's the DIME method, and for a typical family it lands between 10 and 15 times income. Rules of thumb like 10× income get close, but they miss big items like a large mortgage.
For most families, term. A healthy 35-year-old can buy $500,000 of 20-year term coverage for under $30 a month, while whole life at that size often runs 8 to 10 times more. Term matches the years your family actually depends on your income. Whole life mainly makes sense for estate planning or a permanent need.
Almost never. Group coverage is typically one or two times salary, while a DIME calculation for a family with a mortgage usually comes out above ten times salary. It also isn't portable: leave the job and the coverage usually ends. Treat employer coverage as a bonus you subtract from your need, not the plan itself.
Yes. A stay-at-home parent doesn't earn a paycheck, but replacing what they do costs real money: childcare, transport, and household management can easily run $25,000 to $40,000 a year. If they died, the surviving parent would have to pay for all of it while working. A $250,000 to $500,000 term policy is a common answer.
Every year the mortgage shrinks, the kids get closer to independence, and your savings grow, so the gap the insurance has to fill gets smaller. That's why laddering works: stack a 20-year and a 10-year term policy, and let the shorter one expire once the heavy-obligation years are behind you. Rerun the numbers after big life changes.