Run your budget on one income
The exercise that makes the coverage question concrete.
Deciding how much coverage you need in the abstract is hard. Deciding it after you've seen what happens to your actual budget is much easier.
This takes about twenty minutes and a bank statement.
Step one: list what doesn't stop
Take a month of statements and mark every cost that would continue regardless. The mortgage, utilities, insurance, food, transport, childcare, minimum debt payments.
These are the ones that don't care what happened to your household. That total is the number to work from.
Step two: remove one income
Subtract the higher earner's take-home pay, then the lower earner's, and look at both results. Households often assume the answer is obvious and find it isn't.
Also add anything that would become a paid expense — childcare currently covered by a parent's time is the most common and most underestimated.
Step three: see how long savings last
Divide available savings by the monthly shortfall. That's your runway in months, and it's usually a sobering number.
Runway is the real question. Insurance isn't there to replace an income forever — it's there to make sure nobody has to sell the house in month four.
Step four: decide what you're buying
Now the coverage question is concrete: enough to clear the mortgage, enough to cover the shortfall for a number of years, or both.
That's a decision you can actually make, and it's a much better brief to take to a licensed professional than "how much do I need?"
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General information only. A licensed insurance professional can tell you what actually applies to you.
General information only, not insurance advice. Coverage, availability, and terms vary by insurer and by state. Quote My Policy LLC is a licensed insurance producer.