Experts believe that a surviving spouse with children needs at least $100,000.00 worth of insurance for every $500.00 of pre-tax income. If you require $3,000.00 a month ($36,000.00 per year) to cover your expenses, your spouse should have $600,000.00 of
life insurance.($3,000.00/500.00 = 6; 6 x 100,000.00 = $600,000.00)of insurance to meet your bills. The surviving spouse would invest the $600,000.00 at a conservative interest rate of 6 % which would generate $36,000.00 a year in interest before taxes.
Because the surviving spouse and children would be living off the interest, rather than the principal the income would last forever.

Many people feel that $50,000.00 worth of insurance, that’s commonly part of an employee benefit’s package is enough. It is not.

Therefore, at the time of divorce, it is imperative that additional insurance be obtained so
that in the event that your spouse dies and alimony and child support ceases, the
surviving spouse and children have sufficient funds to live on.

In the event that the parents were never married, life insurance can still be obtained on
the obligor so that the surviving parent (or whoever will have guardianship) will be able
to care for the child. The parent on the receiving end of child support should also have
sufficient life insurance in the event that they should predecease the child and absent
parent.