How Much Life Insurance?

June 2, 2015

life insurance utica ny

image courtesy of Stuart Miles at

For most people living here in the Utica-Rome area we like to think of life insurance as an income replacement vehicle. Yes, some people will have estate taxes to pay and others have responsibilities to their businesses.

But for many hard working Central New Yorkers, especially those whose families depend on their income, a sudden halt to that income would be a great hardship. So if you start thinking about life insurance as income replacement, you can get a clearer picture of how much you would need.

But remember, whatever you decide is a best guess. In our experience at Scalzo, Zogby & Wittig and especially after an unexpected, premature death, whatever amount of life insurance you own ends up a Godsend for your family left behind.

Typical Life Insurance Scenario in New Hartford

So let’s start with an easy set of calculations. You’re 30 years old and you contribute $70,000 to your household income. As with most families in the Utica area, your spouse also contributes. But let’s concentrate on your income only. You own your home and have children attending local schools.

If your kids are small, let’s say that you would need to replace your income of $70,000 if you suddenly passed away. That’s the amount required for the next 15 years while they are still in the household. $70,000 x 15 years = $1,050,000! That’s how much it would take to provide the same salary you are making right now for the next 15 years.

However, the families living expenses may be less without you, plus there may be Social Security benefits, other liquid assets at your family’s disposal, or life insurance benefits at work.

And the simple calculation above does not assume any return on the investment of the full death benefit. Remember, your life insurance company pays your beneficiaries the full amount within a very short period of time after your death. Your family will have that amount at their disposal to invest as they see fit.

With so many variables to your family’s financial survival after your death, you might be realizing that the answer to, “How Much Life Insurance?” is complicated. It’s also imprecise because so much of the calculation demands predicting the future. And that’s tough to do with complete accuracy.

The benefit of thinking in terms of the $1,000,000 life insurance policy purchased to replace $70,000 for a 30-year-old married man or woman with kids is that it gets you to understand your value to the family in financial terms.

And that’s the beginning of the process of answering the question of how much. Ultimately, we recommend you call us to help you think through the calculation to come up with the right amount at the right price.

At Scalzo, Zogby & Wittig, we represent more than one A+ rated life insurance companies that will be there when you need them. We also think you’ll be surprised at how inexpensive it is to cover you for some very high amounts of coverage. People are healthier today than ever before, and that fact is reflected in the rates.

So call us today and we’ll talk Life!

Until next time,
Your SZW Team

Scalzo, Zogby & Wittig, Inc. is your New Hartford area independent insurance agent. Call us for a quote on insurance for your home, car, business, or life at 315.792.0000.