There is no one-size-fits-all when it comes to life insurance. How much and what type of coverage is needed is based on the individual and his or her:
- Income, current financial situation
- Number of dependents
Plus, as people move through life, their life insurance needs may change based on changes in their personal situation, including getting married or divorced, having children, change in income, etc.
Based on these considerations, a basic rule of thumb is to have enough life insurance coverage to provide approximately 10 times your annual household income. For example, if the current household income totals $50,000, consider having a total of $500,000 in life insurance protection.