Plan security with clear income protection estimates now. Include debts, goals, and survivor benefits too. See a coverage target that fits your family today.
| Annual Income | Replacement | Years | Inflation | Return | Offsets | Estimated Coverage |
|---|---|---|---|---|---|---|
| $120,000 | 75% | 25 | 3% | 6% | $135,000 | $1,250,000 |
| $80,000 | 70% | 20 | 2.5% | 5% | $60,000 | $750,000 |
| $150,000 | 85% | 30 | 3.5% | 6.5% | $250,000 | $1,800,000 |
First-year income gap estimates the yearly support your household would miss:
Gap = (Income × Replacement% × (1 − Tax%)) − (OtherIncome × (1 − Tax%))
Present value of income replacement uses a growing annuity model with inflation (g) and return (r):
PV = P1/(r − g) × [1 − ((1+g)/(1+r))^n]
Total needs add one-time expenses. Existing savings and coverage reduce the target.
Families often need steady cash flow after a loss. This calculator estimates an after-tax income gap. It applies your chosen replacement percent and subtracts other survivor income. The result becomes the first-year support amount. Many planners start near seventy percent, then adjust for housing, childcare, and healthcare. Use your actual budget to validate the percent.
Future expenses usually rise, so the model grows support by inflation each year. Investment returns discount those future payments back to today. When returns exceed inflation, the present value declines. When inflation approaches returns, required protection rises sharply. The tool uses a growing annuity present value method across the protection years. Small rate changes compound, so test realistic ranges.
Many plans fail because immediate bills are ignored. Clearing debts can reduce monthly pressure. Education funding, final expenses, and emergency reserves help avoid forced selling. The calculator adds these items as one-time needs, then combines them with the income stream. Consider adding relocation costs, medical deductibles, or business continuity expenses. Treat one-time goals as today’s dollars for consistency.
Savings and existing coverage can already fund part of the plan. By subtracting offsets, the tool focuses on the uncovered gap. A safety margin then adds a buffer for rate uncertainty, lifestyle changes, and timing differences in benefit payments. Include only assets intended for family support, not restricted accounts. Review employer coverage limits and renewal risk.
Try multiple replacement levels and time horizons. Compare conservative and optimistic return assumptions. If you expect higher survivor income later, lower the gap and re-run. The chart visualizes how the coverage target changes as returns move, helping you pick a resilient target. Revisit the inputs annually as income, debts, and dependents change. Keep notes on assumptions, and discuss results with a licensed advisor before purchasing coverage for your personal situation.
It is the estimated lump sum needed today to fund income support plus one-time needs, after subtracting savings and existing coverage, then adding your safety margin.
Inflation raises future living costs. The calculator grows the income gap each year by the inflation rate, so the present value of support is higher when inflation is higher.
Use a long-run, diversified portfolio assumption after fees. If you are unsure, start conservative and test higher and lower rates using the chart to see how sensitive the target becomes.
Only include amounts your family can realistically access for support. If accounts are restricted, penalized, or earmarked for retirement, it is safer to exclude them or include a reduced portion.
Run scenarios. Enter today’s income, then re-run with expected future income levels or different replacement percentages. Review annually so coverage stays aligned with your household.
No. It provides planning estimates from your inputs. Policy features, taxes, and eligibility vary widely, so confirm assumptions with qualified professionals before making coverage decisions.
Important Note: All the Calculators listed in this site are for educational purpose only and we do not guarentee the accuracy of results. Please do consult with other sources as well.