Question 1

What is the DIME method for life insurance?

Accepted Answer

DIME stands for Debt, Income, Mortgage, and Education. Add up all four: your non-mortgage debts, your income multiplied by years needed, your mortgage balance, and estimated education costs for children. Subtract existing coverage. The result is your recommended policy face value.

Question 2

How much does a $1 million life insurance policy cost?

Accepted Answer

A healthy 35-year-old non-smoker can get a 20-year $1 million term life policy for $40–60/month. Rates increase significantly with age, health conditions, and tobacco use. Term life is almost always sufficient for income-replacement purposes and costs a fraction of whole life policies.

Question 3

Term life vs. whole life — which should I buy?

Accepted Answer

For most families, term life is the right choice. A 20- or 30-year term policy provides coverage during your highest-need years (while the mortgage is active and kids are growing) at 5–10x lower cost than whole life. The 'investment' component of whole life rarely outperforms simply buying term and investing the premium difference.

Question 4

Does my employer-provided life insurance count?

Accepted Answer

Group life insurance through work typically provides 1–2× your annual salary — useful but usually not enough. More importantly, it disappears when you leave the job. Use your employer coverage in the existing coverage field, but don't rely on it as your primary protection.

Question 5

When should I review my life insurance coverage?

Accepted Answer

Review coverage after every major life event: marriage, divorce, a new child, buying a home, a significant income change, or approaching retirement. Policies bought at 25 may be inadequate after a mortgage and kids enter the picture — and policies bought with dependents may be over-sized once kids are adults and the house is paid off.

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