Life Insurance Planning: A Complete Guide

Life insurance is a cornerstone of sound financial planning. It ensures that if something happens to you, the people who depend on you financially will be taken care of. Yet many people either don't have life insurance, or they are underinsured without realising it.

This guide breaks down the key types of life insurance, how much coverage you might need, and how to choose the right policy for your situation.

Term vs. Whole Life Insurance

Term life insurance provides coverage for a set period — typically 10, 20, or 30 years. It is the most affordable option and ideal for covering income replacement during your working years or paying off a mortgage.

Whole life insurance (and other permanent policies) provides lifelong coverage and includes a cash value component that grows over time. It is more expensive but serves as both a protection tool and a savings vehicle.

How Much Coverage Do You Need?

• A common rule of thumb is 10–12 times your annual income
• Factor in outstanding debts, mortgage balance, and future education costs
• Consider your spouse's income and whether they could maintain the household independently
• Account for final expenses and any estate planning goals

When to Review Your Policy

Life changes — marriage, children, a new home, or a career shift — are all triggers to review your life insurance coverage. Regular policy reviews with a licensed advisor ensure your coverage keeps pace with your life.