Life Insurance Need Glide Path Calculator
Example: Annual income to replace: 85000 $ · Your current age: 38 · Target retirement age: 65 · Remaining mortgage balance: 320000 $ · Number of dependent children: 2 · Youngest child's current age: 5 · Annual savings + investment return: 10 %/yr · Current investable assets: 120000 $
| Age when you can self-insure (no coverage needed) | 54 |
| Coverage need today | $2,306,500 |
| Coverage need in 10 years | $1,148,014 |
| Coverage need in 20 years | $0 |
Worked example
A 38-year-old earning $85,000 with $120,000 saved, a $320,000 mortgage, and two children (youngest age 5) needs approximately $1.8M of coverage today. In 10 years, the youngest is 15, assets have grown, and the mortgage has shrunk — need drops to about $900,000. At 20 years (age 58), kids are independent and assets exceed obligations: need is near zero. This person can rationally drop coverage around age 56.
Frequently asked questions
Should I renew my 20-year term policy when it expires?
Recalculate your need first using this glide path. Many people find that by the time a 20-year term expires, their obligations have shrunk and assets have grown enough that renewing is unnecessary — or a much smaller policy suffices.
What if one spouse is a stay-at-home parent?
The stay-at-home parent's economic contribution (childcare, household management) has real replacement cost — the NAIC estimates $40,000–$80,000 per year depending on children's ages. Include this in the income replacement calculation for the lower-earning or non-earning spouse.
Does savings rate really change the coverage glide path that much?
Yes significantly. A household saving 5% of income accumulates wealth slowly, maintaining a high coverage need well into their 50s. A household saving 20% may self-insure by their late 40s. The discipline of saving is the most powerful life insurance substitute.
Should I keep any coverage past the zero-need age?
Some people maintain a small policy to cover final expenses ($15,000–$25,000) regardless of assets. Others keep a policy for estate equalization or charitable giving. These are reasonable choices but different from income-replacement life insurance.