178-How Much Life Insurance Do I Need? A Simple Tutorial On How To Calculate A Life Insurance Needs Analysis For Yourself

Today's show gives you the tools you need to sit down and calculate an appropriate amount of life insurance coverage for you to own.

On Episode 173, I discussed the three primary ways of calculating an appropriate amount of insurance:

1. Human Life Value approach
2. Needs Analysis approach (the best)
3. Rule of Thumb approach

This show teaches you how to calculate a Needs Analysis.

The process is simple:

What You Want - What You've Got = What You Need

In order to figure out what you want, simply make a list of everything you want for your family in case of your death.

Divide that list into:

1. Lump Sum needs (immediate cash)
2. Income needs (ongoing cash)

For the income needs, decide:

1. How much?
2. For how long?
3. Liquidating approach or a non-liquidating approach?

Enjoy the show!

Joshua

Links:

• Episode 173: http://radicalpersonalfinance.com/173-economic-basis-of-life-insurance-and-individualfamily-uses-of-life-insurance/
• Episode 101: http://radicalpersonalfinance.com/how-to-calculate-how-much-you-need-to-save-for-your-kids-college-rpf0101/
• Support Radical Personal Finance! http://radicalpersonalfinance.com/patron