Factors Affecting Need
Sheet1
Determining My Life Insurance Needs (page 353)
NOTE: Results here may differ slightly than when using Appendix A in text due to rounding.
Factors Affecting Need Sample Only Insert Your Own Figures
1. Income-replacement needs* $823,219
2. Final-expense needs $ 12,000
3. Readjustment-period needs $ 19,000
4. Debt-repayment needs $ 10,000
5. College-expense needs $ 75,000
6. Other special needs $ – 0
7. Subtotal (combined effects of items 1–6) $ 939,219
8. Government benefits** $390,370
9. Investment Assets Available $0
10. Current Life Insurance In Place $ 98,000
11. Life insurance needed $ 450,848
*Income Replacement Needs Calculator
Current Annual Income $56,000
Percent of Annual Income To Be Replaced 75%
Annuity Amount (% desired of annual income) $42,000
i (assumed interest rate 3.00%
n (number of annuity payments) 30
PV (present value) of Income Replacement Needs $823,219
**Present Value of Social Security Benefits Calculator
Estmated Monthly Benefit (See Appendix B in Text) $2,725.00
Estimated Annual Benefit $32,700
i (assumed interest rate 3.00%
n (number of annuity payments) 15
PV (present value) of Government Benefits $390,370
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Sheet3
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