DIME Coverage Calculator
Use the DIME method (Debt, Income, Mortgage, Education) to calculate your life insurance needs. This comprehensive approach ensures you cover all financial obligations.
Frequently Asked Questions
What is the DIME method for life insurance?
DIME stands for Debt, Income, Mortgage, and Education. You add up all outstanding debts, multiply your income by years of replacement needed, add the mortgage balance, and add education costs for your children. The total is your recommended coverage amount.
Should I include my mortgage in life insurance coverage?
Yes. Your mortgage is typically your largest financial obligation. Including it ensures your family can stay in their home without struggling to make payments. Some people opt for a separate decreasing term policy that matches their mortgage amortization.
How much should I allocate for education in the DIME method?
Plan for $80,000-$200,000 per child for a 4-year degree at a public or private university. If you want to cover room and board, private school, or graduate school, increase the amount accordingly. Consider education inflation of about 5-6% per year.