Term Life Insurance Calculator

Not sure how much term life insurance you might need? Answer a few quick questions to assess your life insurance needs.

Immediate cash needs

Lump sum cash needs at death to meet immediate obligations.

Amount remaining on mortgage

Do you have an outstanding balance on your mortgage? You can use the principal amount if you are unsure.

Amount remaining on mortgage

$

Loans and other debts

Consider any credit cards, bank loans, car loans, student loans, business debt, etc.

Outstanding debt

$

Final expenses

The cost of a funeral can range anywhere from $5,000 to $15,000 or more. This depends on whether it’s a cremation or burial. If it’s a burial, the choice of coffin and location can also drastically impact the price.

Final expenses

$

Emergency fund

Experts typically suggest having 3-6 months of salary prepared for emergencies.

Emergency fund

$

Children's education fund

This is the amount you put away for you children’s education:

  • Average total cost of a 4-year program including living expenses is approximately $85,000
  • Average Canadian tuition per year: $6,580 (Statistics Canada, 2020/21)
  • Average cost of books and course materials per year: $773 per year (Maclean’s, 2018)
  • Average housing, food, and transportation costs per year: $13,750
Children's education fund

$

Income replacement

Used to determine the amount of money needed for a replacement income.

Annual income replacement

This is the income needed to pay for groceries, car, gas, housing, clothing, hydro, water, and other expenses. If you do not have this number on hand, consider using your after-tax income.

Annual income replacement

Property taxes, heating & electricity, car payments, daily expenses, etc.

$

For how many years?

People often choose the number of years until their youngest children move out.

For how many years?
Assets

Liquid assets that can be used to pay off debts.

Current savings

Consider cash and other liquid assets (e.g. mutual funds, stocks, bonds). Do not include RRSP savings as this will provide retirement income to a spouse.

Current savings

$

Other investments

Include the value of assets that your survivors might sell (e.g. your house or car). Do not include any assets they will need or continue to use.

Other investments

$

Existing life insurance coverage

Consider any individual or group life insurance plans. Do not include AD&D plans as a payout is not guaranteed.

Existing life insurance coverage

$

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Any questions?

Is term life right for me?

It's popular among younger individuals including those that may have kids, debt (including mortgages), or other time limited obligations that they want to ensure they take care of in case they pass away.

Term life is the simplest and most affordable form of life insurance as it does not have an investment component. You can read more about the differences between term, whole, and universal life on our blog.

Walnut does not offer whole or universal life products, but you can talk to an RBC Insurance advisor who can provide those options.

How much coverage should I get?

Consider the obligations and individuals you may want to take care of. Are there debts, including mortgages, that you would like to cover in case you pass away? Dependents like spouses or children who depend on your income for everyday expenses or for education? Funeral and other final expenses? And then reduce that amount by any liquid assets like cash, savings, or other investments that could be made available to loved ones immediately.

What term length should I get?

Term life is the most affordable option to cover time limited obligations. Consider the length of your mortgage or the number of years a spouse may need income or how many years before your children would be independent.

Also consider your budget. The premium is the amount that you are paying for life insurance coverage. The term length determines the number of years that your monthly or annual premium will be fixed. Shorter term lengths will have lower premiums while longer term lengths will have higher premiums. Locking in a premium now for the next 20 years with certainty is a benefit, but comes at the cost of higher premiums for the same amount of coverage.  

It's important to note that while you are selecting a term length, you are not forced to keep that coverage for the entire term. Your needs may change over time and you have the option to cancel your policy. Just keep in mind that you will never be as young as you are today and premiums rise as you get older, all things being equal.

Can I chat with an advisor?

Sure, click here to start a chat with a licensed advisor or feel free to give us a call at 1-888-966-5308.