It is one of the first questions people ask when they start shopping, and the honest answer is that it depends on your family, your income, and your goals.

Start With the Income Rule of Thumb

A common starting point is 10 to 12 times your annual income. If you earn $60,000 a year, that works out to roughly $600,000 to $720,000 in coverage. This is only a guideline, but it gives you a number to work from before you factor in your own situation.

Add Up What Your Family Would Need

A more accurate approach is to list what your loved ones would need to stay financially stable if you were gone. Consider:

• Daily living expenses: groceries, utilities, transportation, and childcare

• Your mortgage and other debts: home loans, car loans, credit cards, and student loans

• Future costs: college tuition for your children and other long-term goals

• Final expenses: funeral and burial costs, which can add up quickly

• Income replacement: how many years your family would need support

Then subtract what you already have, such as savings, existing coverage, and employer-provided life insurance.