The following is a hypothetical illustration, not a real client, used to show how a new parent might think through buying life insurance for the first time.

The setup

Priya, 29, just had her first child and realized she had no life insurance of her own outside of a small policy through her employer. She wanted coverage that would replace her income and cover the mortgage if something happened to her, without overcomplicating things while she was already adjusting to being a new parent.

How she thought about the coverage amount

Rather than guessing a round number, she added up what she wanted covered: roughly ten years of her income, the remaining balance on the mortgage, and a cushion for future childcare and education costs. That gave her a target coverage amount instead of picking a number that felt arbitrary.

How she thought about the term length

She chose a 20-year term to line up with the years her child would most depend on her income — through college. A shorter term would have been cheaper, but she wanted the coverage in place well past the mortgage payoff date, not just through the next few years.

Term versus whole life

She considered whole life for the lifetime coverage and cash value, but decided the premium difference wasn’t worth it for her current budget. Term life let her get a larger coverage amount for a lower monthly cost during the years she felt the need was highest, with the option to revisit permanent coverage later.

The takeaway

There’s no universal formula for how much coverage a new parent needs, but working from actual numbers — income, debt, and future costs — tends to produce a more useful answer than a rule of thumb. What made sense for Priya’s budget and timeline won’t be identical for every family.

This is a hypothetical illustration for educational purposes only. It does not represent any actual client, and it is not a guarantee of any specific outcome or future results.