How much life insurance do you really need?
Use the D.I.M.E. method, the same approach our agency uses with clients, to estimate the coverage that would keep your family financially secure. It takes about 3 minutes. Then learn how Term, Permanent and Indexed Universal Life (IUL) policies differ.
What is the D.I.M.E. formula?
DIME is a straightforward way to estimate your life insurance need by adding up four things your family would have to pay for if you were gone. It's more personal than a "10× your salary" rule of thumb because it's built from your actual debts, income, home and kids.
Debt
All non-mortgage debt: credit cards, car loans, student loans, personal loans, plus final expenses such as funeral costs.
Income
Your annual income multiplied by the number of years your family would need it replaced, often until the youngest child is grown.
Mortgage
The remaining balance on your home loan, so your family can stay in the home without the monthly payment.
Education
The future cost of college or trade school for each of your children.
Formula: Debt + (Income × Years) + Mortgage + Education − existing life insurance & savings = estimated coverage need.
DIME Life Insurance Calculator
Enter what you know. Rough numbers are fine, and you can leave anything at $0.
Debt & Final Expenses
Everything you owe other than your mortgage. This would be paid off so it doesn't fall on your family.
Income Replacement
How much income would your family lose, and for how many years would they need it? A common choice is until your youngest child turns 18 or finishes college.
Mortgage
Your remaining mortgage balance (check your latest statement). Include a HELOC or second mortgage if you have one. Renters can enter $0, since rent is already covered by income replacement.
Education
How many children would you like to help through college, and roughly what type of school?
What You Already Have (optional)
Coverage and savings your family could already use. These are subtracted from your DIME total.
Every family is different. Want us to confirm this number and show you Term, Whole Life and IUL options side by side? Send your results below and a licensed agent will follow up. There's no obligation.
This calculator gives an educational estimate only. It is not a quote, an offer of coverage or financial advice. Actual coverage amounts, premiums and eligibility depend on underwriting and your full financial picture.
Term, Permanent or IUL: which fits you?
Once you know how much coverage you need, the next question is what kind. Here's a plain-English guide to the three main types we offer.
Term Life Insurance: maximum protection for a set period
Term life covers you for a specific number of years, commonly 10, 15, 20 or 30. If you pass away during the term, your beneficiaries receive the death benefit, usually income-tax-free. If the term ends while you're living, coverage stops (many policies let you renew or convert to permanent coverage).
Because it's pure protection with no cash value, term is usually the most affordable way to get a large amount of coverage. That makes it a natural match for the DIME number above. Many families line the term length up with their mortgage or with the years until their kids are grown.
- Lowest cost per dollar of coverage
- Level premiums locked in for the term you choose
- Simple and easy to understand
- Conversion options may let you switch to permanent coverage later without a new medical exam
Often a good fit if you:
- Have a mortgage and young children
- Want the most coverage for your budget
- Need protection during your working and child-raising years
- Are covering a specific debt or business loan
Keep in mind
- No cash value
- Renewing after the term ends usually costs much more
Permanent Life Insurance: lifelong coverage that builds value
Permanent life insurance, such as whole life, is designed to cover you for your entire life as long as premiums are paid. Part of each premium goes toward cash value that grows on a tax-deferred basis at a guaranteed rate.
Over time you can borrow against that cash value or surrender the policy for it. With whole life, premiums are typically fixed and the death benefit is guaranteed. It costs more than term, but it's built to be there no matter when you pass away.
- Coverage that lasts your whole life
- Guaranteed cash value growth (whole life)
- Fixed premiums that never increase
- Can be used for final expenses, estate planning, leaving a legacy or business succession
Often a good fit if you:
- Want coverage that never expires
- Want to leave an inheritance or cover estate costs
- Have a lifelong dependent, such as a child with special needs
- Value guarantees and a forced-savings component
Keep in mind
- Higher premiums than term for the same death benefit
- Outstanding loans and withdrawals reduce the death benefit
- Cash value builds slowly in the early years
Indexed Universal Life (IUL): permanent coverage with market-linked growth potential
An IUL is a type of permanent life insurance with flexible premiums and a cash value that can earn interest based on the performance of a market index, such as the S&P 500®. Your money is not invested directly in the stock market. Instead, interest is credited using a formula tied to the index.
Three features shape how an IUL's cash value grows:
The cash value can grow tax-deferred, and you may access it through policy loans or withdrawals, which some clients use to supplement retirement income.
- Lifelong death benefit protection
- Growth potential linked to a market index, with downside protection from the floor
- Flexible premiums and adjustable death benefit
- Tax-advantaged access to cash value through policy loans
Often a good fit if you:
- Want permanent coverage plus cash value growth potential
- Have maxed out other tax-advantaged savings
- Are a business owner or high earner planning long-term
- Want flexibility in how much and when you pay
Keep in mind
- Caps and participation rates can change and are not fully guaranteed
- Index credits exclude dividends
- Policy charges still apply in 0% years
- Underfunding, loans or withdrawals can reduce benefits or cause the policy to lapse. Review your policy regularly with your agent.
| Term Life | Permanent (Whole) Life | Indexed Universal Life | |
|---|---|---|---|
| How long it lasts | Set period (10–30 yrs) | Lifetime | Lifetime, if properly funded |
| Relative cost | $ Lowest | $$$ Highest | $$ to $$$ Flexible |
| Premiums | Level for the term | Fixed | Flexible, within limits |
| Cash value | None | Yes, guaranteed growth | Yes, index-linked growth with a floor |
| Growth potential | N/A | Steady, predictable | Higher potential, up to a cap |
| Best for | Covering your DIME need affordably | Guarantees, legacy, final expenses | Lifelong coverage + long-term accumulation |
Many families combine policies, for example a large term policy for the DIME years and a smaller permanent or IUL policy for lifelong needs. We'll help you find the right mix.
Let's review your number together
Free, no-obligation life insurance review with a licensed agent. CA License #6014107.
This page is for general educational purposes and is not tax, legal or investment advice. Life insurance products are subject to underwriting, availability, and terms and conditions that vary by state. Guarantees are based on the claims-paying ability of the issuing insurer. Policy loans and withdrawals reduce cash value and death benefit, may cause the policy to lapse, and may have tax consequences. An IUL is not an investment in the stock market or any index; index-linked interest is subject to caps, participation rates and other limits that may change. Past index performance does not guarantee future results. Consult your tax advisor regarding your situation. Amik Gasparyan Insurance Agency, 372 Arden Ave #103, Glendale, CA 91203.
Send your results to a licensed agent
Finished the DIME calculator? Your breakdown fills into this form automatically. Add your name and contact info, and we’ll review your number with you and compare Term, Whole Life and IUL options. Free and no obligation.