When it comes to life insurance, most individuals are underinsured. However, there are many reasons why life insurance is a worthwhile expenditure. Life insurance is a low-cost way you can build the wealth of your estate. Life insurance provides ready cash after your death for your loved ones who receive it free of income tax. It can also be used to fund a business buy-out plan. In addition, if you buy a whole-life plan, your life insurance can work just like a savings account. But how much life insurance do you need? At the very least, you'll need enough to provide a lump sum amount that will replace your income after you're gone, plus a little more. Remember, bills will continue after death. There are funeral costs, repayment of loans, credit card balances, and other miscellaneous debts that will have to be paid. This is true even if you are single, or you have no heirs. You should review your financial situation every year or two to determine whether your coverage matches your current needs. There are many different types of policies and variations of each. Consult an insurance professional, legal professional, or a financial planner to determine which policy is best for you.