Collegiate Alumni Life Calculator (CALC)

“How much life insurance do I need?” You need enough to help your loved ones cover your primary financial obligations in your absence. But every family’s financial situation is unique. Many calculators do not consider enough data about your financial life, resulting in a quick but inadequate result.

CALC is designed to cover the important areas without making its completion overly complex and time-consuming. Answer some important questions and you’ll receive a fairly detailed, personalized estimate of your life insurance need.

When should you use CALC? Owning life insurance doesn’t mean you’ll never need to think about it again. It’s important to re-assess your life insurance need whenever you experience a significant life event, like a marriage, birth of a child, divorce, or job change – and at least every five years, since your circumstances probably will have changed.

Income Needs
Income Needs

“How much life insurance do I need?” You need enough to help your loved ones cover your primary financial obligations in your absence. But every family’s financial situation is unique. Many calculators do not consider enough data about your financial life, resulting in a quick but inadequate result.

CALC is designed to cover the important areas without making its completion overly complex and time-consuming. Answer some important questions and you’ll receive a fairly detailed, personalized estimate of your life insurance need.

When should you use CALC? Owning life insurance doesn’t mean you’ll never need to think about it again. It’s important to re-assess your life insurance need whenever you experience a significant life event, like a marriage, birth of a child, divorce, or job change – and at least every five years, since your circumstances probably will have changed.

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Enter your own current total annual gross earned income.

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Enter your partner/spouse’s current annual gross earned income, if applicable.

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Enter all other gross family annual income from dividends, interest, rents, etc.

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* Required
Income Needs
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Experts recommend 70%-80% of your Total Family Income to cover your survivors’ needs without a major lifestyle change. Families with higher incomes typically fall into the lower end of the range. We have pre-populated 80%. Override this pre-populated entry if you have information that will produce a more personalized analysis.

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Enter the number of years you think your survivors will need to replace your income. This is not an easy answer, as everyone’s situation is different.

If you have children, you may wish to enter the number of years until the education of the last one is completed. Or you may wish to consider your spouse/partner’s expected retirement age or life expectancy.

* Required
Debt
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CALC assumes your beneficiaries would pay off the mortgage immediately using life insurance proceeds.

If your survivors would keep the existing mortgage and continue to pay it from the current budget, leave this Item blank. This means that your family’s Desired Annual Survivor Income includes funds sufficient to make ongoing mortgage payments.

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Examples include student loans, credit card balances, auto loans, home equity loans and other personal loans, including those from family and friends.

Expenses
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The average funeral costs approximately $7,800 (National Funeral Directors Association, 2021), which includes a casket and funeral service. It does not include a cemetery plot, which ranges from $400 to $10,000 or more, depending on location.

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This includes the costs of setting your estate (typically 2% of the estate, uncovered medical expenses, and terminal illness expenses).

The federal estate tax exemption in 2024 is scheduled to be $13.61 million per person ($27.22 million for a married couple). That tax provision, however, is scheduled to expire in 2026, when the exemption is estimated to reduce to under $7 million. Currently, 33 states have no estate or inheritance tax. However, the “death tax” provisions in the remaining jurisdictions vary greatly and can significantly impact your final expenses.

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A general guideline for an emergency fund is three-to-six months of your Annual Family Income.

Expenses
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Enter your family’s estimated desired funds for higher education. Use our worksheet as a guide to determine the total amount your family would need to invest today to cover your children’s future costs for higher education here.

Click here to use our worksheet.
Expenses
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Consider how much it would cost for childcare and how long your family would need services. This is especially important if you’re a stay-at-home parent. Keep in mind that childcare needs will change as your children get older. While young children may need full-time childcare, it may no longer be needed as they get older. 2023 average annual costs for childcare are:

  • Daycare $7,020 - $26,156
  • Nanny $31,200 - $49,900

Costs vary considerably based on location. Visit Care.com to estimate costs in your area.

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Enter the cost of services you provide that would need to be paid for—if not covered by family and friends. Consider the number of years care will be needed. If your parent/relative owns Long Term Care insurance, adjust for expenses that policy would cover. According to the Mutual of Omaha 2023 Cost of Care report, national annual average costs for care are:

  • Home health aide: $66,627
  • Assisted living facility- private- one bedroom - $63,336
  • Nursing home - semi-private: $100,202
  • Nursing home - private: $114,980
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Most people have responsibilities for which they are not paid. Enter expenses for services that would need to be paid for in your absence. For help calculating these values, use the expanded version of this section here.

Click here to use our worksheet.
Assets and Assumptions
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Enter the total of your group and individual life insurance that is payable to your survivors, reduced by the amount of any policy loans. This can be a little tricky. For example, if you need coverage longer than the time remaining for some existing life insurance policies, consider subtracting the amounts of those policies from your entry.

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Enter the market value of bank accounts, money market accounts, CDs, stocks, bonds, mutual funds, rental property, and other real estate (excluding your residence).

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Enter additional retirement or other savings you wish to have at the end of the life insurance “years needed period.” In retirement, most people will require about 60% to 80% of their pre-retirement income.

Assets and Assumptions
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A 3% inflation rate has been incorporated in the calculation. Override this pre-populated entry if you would like to assume a different rate for future inflation.

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A reasonable long-term range for yield on investments is 4% to 8%. A 6% investment yield has been incorporated in the calculation. Override this pre-populated entry if you have information that will produce a more personalized analysis.

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This allows for lost income due to expected increases in earned income. An average annual income increase of 4% is built into CALC.¹ Override this pre-populated entry if you have information that will produce a more personalized analysis.

¹Source: Social Security Average Wage Index (2013-2022).

* Required
Your Estimated Life Insurance Need

To ensure your family's continued financial well-being, you should consider an additional - in life insurance.

Immediate Needs
Funeral Expenses, Final Expenses, and Emergency Fund
Debt to Pay Off
Mortgage Balance and Other Debt
Long-term Needs
Higher Education Costs and Other Expenses
Supplemental Income Needed
Calculated
Total Needs
Calculated
Less Current Assets
Current Life Insurance, Savings, and Investments
Additional Life Insurance Need
Calculated

Term Life insurance through your alma mater can provide the protection your family needs. Learn more about your insurance options.

These results should be used as a guide only and are not a recommendation. There may be other factors to consider in deciding how much insurance is appropriate.

Note: CALC does not consider income taxes, payroll taxes, and death taxes.

We recommend that you use this calculator only as a guideline, one of many ways to estimate and analyze your life insurance needs. The results generated may vary due to your input and assumptions. Your alumni/ae organization, Meyer and Associates, and our insurance carrier partners do not guarantee the accuracy of the calculations, results, explanations, or applicability to your own situation, and suggest that you consult with your financial advisor.

Higher Education Costs

Use this worksheet as a guide to determine the total amount your family would need to invest today to cover your children’s future costs for higher education. Projected costs include tuition, fees, room, and board, and are assumed to increase at an annual rate of 5%.

The College Board reports that the 2023-2024 average annual cost for two-year public colleges is $19,860. Four-year public colleges – in-state and out of state– are $28,840 and $46,730, respectively. The average annual cost for private colleges is $60,420.

Enter your children’s ages and school preferences individually. For a more personalized estimate, you may wish to deduct current funds in a child’s name and adjust for any automatic savings for college that are already part of your current budget and, therefore, already accounted for in Desired Annual Survivor Income.

 
Age
School Type
Estimated
College Cost

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Value of Other Unpaid Work

Many of us provide additional services for which we are not paid. If your family would need to outsource those myriad tasks in your absence, the costs could be significant. Below are national average hourly rates for common services. These will, of course, vary based on your family situation and location, so use them as a guide for your own estimation.

 
Hours/
Week
Hourly
Rate ¹
Estimated
Annual Cost
Years
Needed
Total
Cost

Tutoring

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$
$

Household Management

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$
$

Financial Management

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$
$

Transportation

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$
$

Meal Planning & Preparation

$
$
$

Housekeeping & Laundry Services

$
$
$

Yard Care

$
$
$

Other

$
$
$

Total

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$
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¹Source: Salary.com, 2023. These are average costs and will vary by location, so use them as a guide for your own estimation.
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