The DIME method: Debt, Income, Mortgage, Education — added up, minus what you already have covered.
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Get a free consultation →DIME is a standard method financial advisors use to estimate life insurance needs: Debt, Income, Mortgage, Education. It adds up every major financial obligation your family would face without your income, then subtracts what you already have covered — existing life insurance and liquid savings — to find the coverage gap.
This is usually the biggest number in the calculation, and the right answer depends on your situation — until kids are grown, until a spouse could realistically re-enter the workforce, or until retirement. 10-20 years is a common range, but there's no universal right answer.
Final expenses (funeral costs, typically $7,000-$12,000), ongoing childcare costs, and inflation over the years aren't broken out separately here — you can fold rough estimates for these into the "debts" or "education" fields if they apply to you.
No — some advisors use a simpler "10x income" or "human life value" method instead. DIME tends to be more precise because it accounts for your actual debts and mortgage rather than a flat income multiple, but any method is a starting point, not a precise answer.
If you're calculating coverage for yourself, this reflects what your family would need if your income and contributions disappeared. Many couples run this calculator separately for each spouse, since the amounts often differ.
For pure income-replacement needs like this, term life is usually more cost-effective since you're covering a defined period (until debts are paid, kids are grown, etc.). Our term vs. whole life calculator can help you compare the two directly.