Welcome to Lesson 5! In this lesson, we cover the exact math required to protect your family’s financial future. While many people guess how much life insurance or income protection they need, the 10x Rule provides a solid, foundational baseline to ensure your loved ones are never left financially vulnerable.
Income protection is a financial strategy designed to replace your earning power if you are no longer able to provide for your family due to an unexpected tragedy or premature death.
Your most valuable asset isn’t your house or your car—it is your ability to earn an income. If that income drops to zero tomorrow, your family’s living expenses, debts, and future goals still remain.
The 10x Rule is an industry-standard benchmark used to calculate your baseline income protection requirement. It states that you should carry a total coverage amount equal to at least 10 times your current annual income.
\[Required\ Coverage = Annual\ Income \times 10\]If your family receives a lump-sum payout equal to 10 times your annual income, they can invest that money conservatively.
| Current Monthly Income | Current Annual Income | Recommended 10x Protection |
|---|---|---|
| ₱25,000 | ₱300,000 | ₱3,000,000 |
| ₱41,600 | ₱500,000 | ₱5,000,000 |
| ₱83,300 | ₱1,000,000 | ₱10,000,000 |
While 10x is a great starting point, you may need more protection if you have: