There is a reason why we don’t call it Death Insurance. It cannot prevent you from dying.You know neither the time nor the place. Some people consider the insurance death benefit to be compensation for their family’s grief. It is not that at all. It provides the funds to pay for all the things your income would have paid for. It prevents your dreams from dying with you. That is what life insurance was created for. Life insurance is for the living.

In 1929, Jack J. Leterman — a long-time life insurance agent in Norfolk, Va. —
enclosed the note below when he delivered a life insurance policy to a client. Except for substituting “Mother” for “Father” when appropriate, his words are probably even more meaningful today and worth reading:

“A life insurance policy is just a time-yellowed piece of paper, with columns of figures and legal phrases, until it is baptized with a widow's tears.
Then it becomes a modern miracle, a sort of Aladdin's Lamp.
It is food, clothing, shelter, education, peace of mind.
It is the sincerest love letter ever written.
It quiets the crying of a hungry baby at night. It eases the heart of a bereaved widow.
It is the comforting whisper in the dark silent hours of the night.
It is new hope, fresh courage, and strength for the widow to pick up the broken threads of life and carry on.
It is an education for the sons and daughters (a chance for a career, instead of the need for a job).
It is a father's parental blessing to his children on their wedding day.
It is the function of a father's hopes and dreams for his family's future.
Through life insurance he lives on.
There is no death. Life Insurance exalts life and defeats death.
It is the premium we pay for the privilege of living after death.”

Note all of the needs and dreams contained in Mr. Leterman’s message. They represent the promises made to your family. How much life insurance do you need to keep those promises? You can’t put a price on a person’s life. But you can put a price on those items above and convert it to a desired stream of income for your family. Then taking into account your assets and liabilities, you can calculate your life insurance needs. Don’t use arbitrary thumb rules, such as a multiple of your annual salary. Do a needs-based analysis. An Insurance Needs Calculator (Link: https://www.nmaa-members.org/Calculators/LifeInsurance.aspx) is a great tool. Don’t be underinsured. Make sure your hopes and dreams live on for your family.