Life insurance needs analysis

20-year indexes: Annualized planning rates are 2.58% general CPI-U, 3.66% education/private school, 4.02% public college and 3.94% private nonprofit college. The historical college tuition growth rates are used as planning assumptions for the full college budget; actual expense categories may grow differently. Increase buttons show the rate and index used.

Children: The child-raising benchmark is $17,648 annually in 2025 dollars through age 17. Private school is modeled for K–8 ages 5–13 and high school ages 14–17.

Full college costs: National on-campus annual budgets are $30,990 for public four-year in-state college and $65,470 for private nonprofit four-year college. These include tuition and fees, housing and meals, books and supplies, transportation, and other personal expenses, before financial aid. The defaults apply for every state selection, with four academic years beginning at age 18. Enter an annual total-cost override for a specific school or to reflect expected aid. These are academic-year budgets; summer costs may be additional. Source: College Board, Trends in College Pricing and Student Aid 2025, Figure CP-1.

State tuition: Published elementary/middle and secondary/high private-school averages populate from the selected state. College uses national full-cost budgets, since the child’s future college and location may differ. Actual schools, aid, fees and enrollment choices vary.

Final and medical preset: The optional $15,000 rounded planning benchmark combines the $8,300 national median cost of a funeral with viewing and burial reported by NFDA and $6,459 in average annual out-of-pocket health spending for Medicare beneficiaries reported by KFF. It is not a prediction of final medical bills.

Social Security: Enter the person’s birth year to calculate Full Retirement Age under Social Security’s birth-year schedule. The optional $3,000 monthly amount is a planning assumption—not a Social Security benefit estimate. After nonzero survivor and benefit-start ages are entered, the calculator increases the entered amount to the selected start age at 2.53%—the compound annualized result of the 20 Social Security COLAs received January 2007 through January 2026. Social Security bases COLAs on third-quarter changes in the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W). No Social Security offset is applied while either age remains 0. View your official benefit estimate at Social Security.

Retirement-plan benefit: Enter any monthly pension or retirement-plan survivor benefit in today’s dollars and the age it begins. Because private and government plans use different COLAs—or none—the calculator uses the 2.58% 20-year CPI-U fallback and offsets income needs only after the benefit begins. Use an estimate that reflects the actual plan when available.

Extra lifestyle and medical income: Enter one optional joint monthly amount for travel, retirement enjoyment and unknown medical expenses. It is assumed to continue permanently and is applied to either coverage scenario. Without inflation, the reserve equals annual spending divided by the selected earnings rate. When “Increase 2.58% / year · 20-year CPI-U” is selected, it is calculated as a growing perpetuity: annual spending divided by the selected earnings rate minus 2.58%.

Emergency fund: Enter one joint emergency-fund dollar amount. It is included in each person’s coverage need. The optional increase button grows it at 2.58% CPI-U through that covered person’s life expectancy.

Mortgage: Enter one shared payoff balance or leave that balance at $0 and enter the shared monthly payment plus the age each partner will be when payments end. If both balance and payment are entered, the payoff balance is used so the mortgage is not counted twice.

Social Security life expectancy: Remaining life expectancy comes from Social Security’s 2023 Period Life Table used in the 2026 Trustees Report. It is a population average—not an individual prediction—and uses the current age and selected male or female table.

High-net-worth planning: Each amount is entered jointly and added once to either coverage scenario. Except for the separately calculated estate-tax estimate, selected increase buttons use 2.58% CPI-U through Person 1’s life expectancy for Person 1’s coverage and Person 2’s life expectancy for Person 2’s coverage.

Estate growth and federal estate-tax estimate: Enter the current joint estate, any existing ILIT-owned life insurance death benefit, and select 4%, 8% or 12% compound growth. The calculator projects the estate through the younger person’s remaining life expectancy. It begins with the 2026 federal basic exclusion of $15 million per person, assumes two exclusions are preserved through proper planning and portability, increases the combined $30 million planning exclusion at 2.31%—the compound annualized change in final BLS C-CPI-U annual averages from 2004 through 2024—and applies a 40% federal estate-tax planning rate to the projected excess. Existing ILIT-owned insurance is then subtracted from the estimated tax to show the additional insurance funding need; it does not reduce the taxable estate in this estimate. Lifetime taxable gifts, deductions, state death taxes, ownership, valuation discounts, portability elections and future law can materially change actual tax.

Tax-related estimate: The estate-tax result is an educational federal estimate, not a tax return calculation or legal recommendation. Consult qualified legal and tax advisers before relying on it.

Business-owner planning: The 13 business needs appear only after at least one person is identified as a business owner. Each selected owner’s entries are added only to that person’s coverage scenario. Selected increase buttons use 2.58% CPI-U through that owner’s Social Security life-expectancy horizon.