How the DIME method works
The DIME method is a widely used way to size a life insurance policy by adding up four needs and subtracting what you already have:
- D — Debt: Pay off credit cards, car loans, and other debts so your family isn't left carrying them.
- I — Income: Replace your income for the number of years your family would need support — often until children are independent.
- M — Mortgage: Clear the mortgage so your family can stay in their home.
- E — Education: Fund your children's education.
We then add final expenses and subtract existing coverage and liquid savings to reach a realistic target. It's an estimate, not a prescription — a licensed Maru advisor can refine it to your goals and budget. Learn more in our term life insurance guide.
Frequently asked questions
Is the DIME method accurate?
DIME is a solid, widely used starting point that captures the four biggest financial needs your family would face. It's an estimate rather than an exact figure — a licensed advisor can refine it based on your specific goals, other income sources, and budget. Use it to get in the right range, then let us fine-tune it.
Should I include my spouse's income?
If your household depends on both incomes, each earning partner should generally have their own coverage sized to replace their contribution. A stay-at-home parent also has real economic value — childcare, household management — that's worth insuring. We can calculate coverage for both partners.
Vadim — Maru Insurance
Licensed independent insurance agent · WA & FL
Written and reviewed by a licensed Maru advisor. Maru Insurance is an independent agency (License #22261820) representing multiple A-rated carriers across Washington and Florida.
Licensed independent insurance agent · WA & FL
Written and reviewed by a licensed Maru advisor. Maru Insurance is an independent agency (License #22261820) representing multiple A-rated carriers across Washington and Florida.
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