The way to calculate an approximate number is to consider all the aspects in which you provide for your family financially, (not including your personal expenses), and come up with a number that can sustain your family monetarily after you are gone. Some of the factors to consider include: The income you bring in from your job, the insurance you pay for, your retirement plan savings, the amount you provide for food, clothing, etc

A beneficiary is the individual or individuals who are pre-appointed to receive the proceeds of your policy after your death. If there is no one named as the beneficiary to your policy, the funds will be distributed according to the contract’s terms,  and may not go to the individuals you intended to receive the benefits. In order to ensure that there are no unexpected changes after your death, make sure that your choice is updated every year.

The proceeds of your life insurance policy are usually given to your beneficiaries without the burden of income tax. You also are exempt from income tax on any money you earn off the policy while the policy terms are valid. Finally, policy loans and withdrawals(although they lower the policy’s cash value), are usually exempt from taxes.