How Much Should You Really Spend on Insurance at Your Age?
Spending more on insurance isn't automatically safer, and spending less isn't automatically smarter. Pay too much of your income toward premiums and you crowd out saving and investing; pay too little and a major illness or accident can wreck your finances. A common rule of thumb is 8-12% of monthly income, adjusted by life stage. Someone in their 20s with fewer obligations can lean toward 6-8%, while someone in their 40s juggling a mortgage and kids' expenses often needs 10-12%. Once retirement approaches and dependents become financially independent, that share typically comes back down.
This calculator sets a baseline range from your age, then nudges the recommended percentage up slightly for each dependent you support. Enter your current monthly premium and it'll tell you whether you're under, within, or over the recommended range for your life stage — a quick gut check before you add or drop coverage.
| Life Stage | Baseline Range |
|---|---|
| 20s | 6-8% |
| 30s | 8-10% |
| 40s | 10-12% |
| 50s+ | 6-10% |
Frequently Asked Questions
Typically 8-12% of monthly income, leaning lower in your 20s and higher in your 40s, plus a bit more per dependent.
More people relying on your income raises the case for protection coverage, but check for coverage gaps before simply increasing spend.
Not always — cash-value or annuity policies are closer to savings. But over 15% in pure protection premiums is worth a review.
※ A simplified guideline that varies by spending habits, debt, and existing assets. Not personalized financial advice.