(Immediate Obligations + Future Income) - Existing Resources = Life Insurance Need
Write down your answers. They might look something like this:
12 years, 22 years, 12 years and 2 years
Use the largest number of years to select a policy for that time frame. A 25-year policy works best in our example. Another option is to layer multiple policies together to cover your needs. This approach could save you 25% or more on the cost of a single policy.