Three common ways of sizing life insurance can give three very different answers for the same family. Enter your numbers once and this calculator runs the DIME method, income multiples and human life value side by side, so you can see the range and what drives it.
By Amara Taylor · Last updated October 13, 2026 · Not a quote. Anchor AI Tools does not sell insurance.
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Debt, income, mortgage, education
5 to 8 times income, the range NAIC mentions
Today’s value of the income your family would lose
The range across the three methods will show here.
Income multiple uses the 5 to 8 times range. Estimates only, not a quote. See our methodology and update log.
Usually more than a simple multiple of your salary suggests. Add the mortgage balance, other debts, the income your family would need until the children are grown, and any education goal, then subtract the cover and savings you already have. Run a second method alongside it and look at why the answers differ.
The National Association of Insurance Commissioners (NAIC) notes that some experts suggest five to eight times your income, and then points readers to their own income, dependents, education costs, debts and final expenses for a closer figure. That is the difference between the middle column above and the other two.
| Method | What it adds up | Good at | Blind to |
|---|---|---|---|
| DIME | Debts and final expenses, income for a set number of years, the mortgage, education costs | Families with a mortgage and children; easy to explain line by line | Pay rises, inflation and investment return on the payout |
| Income multiple | Your income times a fixed number | A quick first figure | Debts, savings, how long income is needed and how many people rely on it |
| Human life value | The income you would still earn until retirement, less your own share, in today’s money | Younger earners with many working years left | Debts and one-off goals; very sensitive to the discount rate |
This household is made up for the page. The earner is 35, makes $70,000 and expects to stop work at 67. The family has a $280,000 mortgage, $25,000 of other debt and a $120,000 education goal for two children, and already holds $150,000 of cover and savings. Final expenses are assumed at $15,000 for the example; use a real quote for your own figures.
| Line | Amount |
|---|---|
| DIME: debts $25,000 + final expenses $15,000 | $40,000 |
| DIME: income $70,000 × 12 years | $840,000 |
| DIME: mortgage | $280,000 |
| DIME: education | $120,000 |
| DIME total less $150,000 already held | $1,130,000 |
| 5 × income less $150,000 | $200,000 |
| 8 × income less $150,000 | $410,000 |
| Human life value: $49,000 a year for 32 years, 2% growth, 4% discount | $1,133,852 |
| Human life value less $150,000 | $983,852 |
The multiples land far below the other two because they ignore the $280,000 mortgage and the education goal, and because twelve years of income is already more than eight times income. DIME and human life value end up within about $150,000 of each other here, partly by coincidence: one counts the debts and a shorter income period, the other counts every working year but no debts.
Life insurers such as Guardian describe human life value as coverage based on your lifetime income potential, what you earn now and what you expect to earn later. The version here removes the share of income that pays your own living costs and taxes, because your family would not lose that part. The assumptions matter a great deal. In the example, changing only the discount rate moves the value today a long way:
| Pay growth | Discount rate | Value today |
|---|---|---|
| 2% | 3% | $1,313,999 |
| 2% | 4% | $1,133,852 |
| 2% | 5% | $987,348 |
| 0% | 4% | $875,804 |
That spread is why the result should be read as a range, not a single number.
DIME stands for debt, income, mortgage and education. The D line covers debts other than the mortgage plus final expenses, the I line is yearly income times the years your family would need it, M is the amount to pay off the mortgage, and E is the cost of schooling and college.
The guide DIME method life insurance walks through each letter with its own example. Unlike the quick life insurance calculator, this page keeps the mortgage as its own line so you can see how much of the total it carries.
A licensed agent or a fee-only planner can turn this range into a specific policy. Check that any agent is licensed in your state.
None on its own. If DIME and human life value land close together, that figure is a reasonable starting point. If they are far apart, look at which input drives the gap, usually the years of income or the mortgage, and decide which picture fits your family.
DIME assumes so, which removes the biggest monthly bill. Some families would rather keep the mortgage and cover the payments from income instead. To see what that payment is, use the mortgage calculator.
Usually until the years of income in your DIME line have passed and the mortgage is paid or close to it. The guide how long term life insurance should be covers this step.
Estimate for planning and learning. Not insurance, financial, tax or legal advice, and not a quote. Anchor AI Tools does not sell insurance or collect your details for leads. See the disclaimer and our editorial standards.
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Last updated: October 13, 2026 · Written and tested by Amara Taylor, Content Lead, Anchor AI Tools. Not yet reviewed by a licensed life insurance professional.