People need insurance for many different reasons. Adequate insurance coverage, or lack thereof, can have a huge impact on your financial life and long-term goals. One of the most common \u2013 and most important \u2013 types of insurance people choose to purchase is life insurance. But it also brings up a lot of questions: Do I need life insurance for myself? What about for other members of my family? And how much life insurance do I really need?\r\n\r\nSeptember is National Life Insurance Awareness Month, so we wanted to take the chance to dive a little deeper into these questions.\r\n\r\nWho Needs Life Insurance?\r\nLife insurance analysis is an important step in ensuring financial protection if a death occurs in your family. The amount of insurance you purchase should cover cash flow needs, debts and other goals - such as ongoing expenses, funding education or retirement - in the event of death of a significant earner in your family. Because of these reasons, however, not everyone necessarily needs life insurance. Typically, single people with no dependents are less likely to need life insurance, people nearing retirement are generally less likely to need it, and those with a high level of net worth will likely require less life insurance needs except in certain estate planning circumstances. Talking to an advisor can help you determine your insurance needs\r\n\r\nHow Much Life Insurance Do You Need?\r\nOnce you\u2019ve decided on life insurance, how do you know how much you really need? While everyone\u2019s circumstances are unique, you should think through all the things that need to be taken care of if you or another household provider is no longer around. Another way to look at it is: if I died, how much would my spouse and\/or dependents need to be ok? And if my spouse died, what would we need to be ok? Consider any of the expenses in your day-to-day life, including:\r\n\r\n \tReplacing your annual income that covers daily living expenses for your spouse and dependents\r\n \tPaying off a home mortgage or any other significant debt\r\n \tCovering any consumer debt (credit cards, car loans, etc.)\r\n \tPaying for childcare, including savings for future college expenses\r\n \tPaying off unpaid medical bills or taxes\r\n \tCreating an inheritance or providing extra retirement income with a tax-free death benefit\r\n\r\nThere is no \u201cone-size-fits-all\u201d life insurance policy, and covering all needs is not always what everyone wants. It\u2019s best to do some research and think through what you would want covered if something was to happen to either yourself or a spouse. Talk to a professional to ensure you purchase the right amount of coverage for your family goals.\r\n\r\nRead More: The Oblivious Beneficiary - Do You Have Unclaimed Life Insurance Money?\r\n\r\nWhat is Personal Capital's Life Insurance Strategy?\r\nAt Personal Capital, we model the effect of losing one or both wage earners on the surviving family\u2019s savings and spending goals in our Monte Carlo-driven Retirement Planner, then we use that simulation to calculate the probable amount of current assets required to keep those goals on track. That amount (after subtracting current savings) gives us a better understanding of the amount of life insurance coverage that will be required to meet your goals.\r\n\r\nDisclaimer: The information on this website is for informational purposes only and does not constitute a complete description of our investment services or performance. No part of this site nor the links contained therein is a solicitation or offer to sell securities or investment advisory services, except where applicable in states where we are registered, or where an exemption or exclusion from such registration exists. Third party data is obtained from sources believed to be reliable. However, Personal Capital Advisors Corporation cannot guarantee that data\u2019s currency, accuracy, timeliness, completeness or fitness for any particular purpose. Certain sections of this commentary may contain forward-looking statements that are based on our reasonable expectations, estimate, projections and assumptions. Forward-looking statements are not guarantees of future performance and involve certain risks and uncertainties, which are difficult to predict. Past performance is not a guarantee of future return, nor is it necessarily indicative of future performance. Keep in mind investing involves risk. The value of your investment will fluctuate over time and you may gain or lose money. All insurance analysis and insight provided is extended to you as a courtesy for educational purposes only. You should not rely on this information as the primary basis of your insurance planning decisions. We are not licensed insurance professionals. You should consult a qualified licensed insurance professional regarding your specific situation.