I've seen a few things recently that concern me and I thought that it was important that I express my worries with you before someone makes a big financial mistake that could potentially hurt them and their families down the road.

Recently I read a page online that, unfortunately, I can't share because of liabilities that read that you only need to have life insurance in the amount of three times your annual salary. This bothers me and no, not because I think that everyone should have more than that as a general rule, but because every family and individual are unique and have unique personal and family needs and obligations. There's simply no way that a qualified life insurance agent will tell you this. Why? Read more.

Here's a brief example of why this wouldn't work for most people.everyone. Let's say that we have a family of mom, dad and two kids where the children are young, ages five and seven, respectfully. The wife is a housewife and has no job experience other than working at McDonald's as a teenager, which was a few years back. The husband earns the majority of the money and makes a decent income of around sixty thousand annually and, like most of us has bills to match that annual income.

They live in a nice home that they're buying, have two vehicle payments, Health Insurance which, even though he gets it as a employee benefit for himself (after deductibles), he still must is required to} pay to have the family covered. They also must pay car insurance for two cars, life insurance for four individuals in different amounts, homeowners insurance, dental coverage and don't forget all of the other frequent expenses such as food, clothing, utilities, ect. Also, they have to send money each month to pay for his mother who is in a elderly home.

There are many other variables that could be thrown into this and I could easily add more and more monthly obligations, but do you see how these bills added up for this family?

This may even be similar to your own circumstances, give or take. In the event of this man's unexpected passing do you really believe that three years worth of his annual income would be a sufficient amount of life insurance for this family? Let's do some math.

With the man of the family earning an annual income of sixty thousand dollars that trippled by three years would give this family $180.000.00 worth of life insurance. This may be stretched into four years worth of living money considering that the breadwinner is now gone, but that only brings the children to the ages of 9 & 11, what then?

It's likely that the man could have allowed for this event, even beyond a normal life insurance policy, by also buying a "Mortgage Life" policy that would pay off the home in the event of his death. He may have also made allowances in the vehicle contracts. But what if he didn't? Even if he had done this it still could have stretched their living expenses another 3 or 4 years, depending on how much they did without unnecessary things. That would bring the kids to the ages of thirteen and fifteen now. What about the next five years until the youngest child turns 18? What about college for each of them? Do the couple's parents have any burial coverage? They probably don't if this couple is already sending money each month for the mother's health needs.

This is all simply an example of a common family situation but I wanted you to take a minute and really think about these things. The only way for you to determine how much life insurance you need for you and your family is to actually sit down and look at every bill that you currently have, the bills that you know will be there in the future, all of the variables that could happen (if these didn't happen there might not be a need for insurance) and then when you think you've got got it figured out add an additional 20% just in case. It's always better to have more than you need than not enough.

If you are the primary provider of your family wouldn't you want to know for without a doubt that your family was going to be taken care of in the event that something happened to you, no matter what the circumstances were? Me too. The only point that I'm trying to get across is to not let someone else pitch to you how much life insurance you need. Sit down with your spouse and then get ahold of a qualified agent. Do it right the first time because, unfortunately, there is no second chance in these life and death circumstances.