Life
Insurance Needs Analysis
IMMEDIATE
MONEY FUND $
This
fund is for bills presented at death
Debt Liquidation Fund $
a.
Total of installment credit
Emergency
Fund $
This
fund is for unexpected bills not readily
payble from current income. Such emergencies
include major home/vehicle repairs,
medical emergencies, etc. (50%
of income may be sufficient)
Mortgage/Rent
Payment Fund $
What
would it take to pay off your mortgage
today?(Note: Over a recent
10-year period, median income for
renters increased 79% but median housing
costs increased 136%. For homeowners,
median income increased 87% but median
housing payments increased 120%. A
mortgage or rent payment fund can
help stabilize a family's future against
the impact of inflation.)
Child/Home
Care Fund $
To
pay for new expenses creased as
a result of the death of a spouse
formerly performing these duties
without any cash outlay.
Number
of Children Both
Spouses working
One
Spouse Working
Husband
Wife
WorkingSpouse
Non-working
1 child $2,850 $11,150 $2,550 $15,300
2 children $3,800 $12,750 $3,500 $17,550
3
or more children $4,450 $14,350 $4,150 $19,150
To determine the
amount of capital that may be required
to offset the economic loss a death
would create, multiply the applicable
number in the table by the appropriate
discount factor below.
Number of years
until youngest child is age 18
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
.93
1.8
2.6
3.4
4.1
4.8
5.4
6.0
6.5
7.0
7.5
7.9
8.4
8.8
9.1
9.5
9.8
10.1
Discount Factors
Educational/Vocational
Fund $
The
cost of a 4-year undergraduate education
or comparable vocational training
will vary by province and type of
school ($25,000 is usually the minimum
that should be provided)
Subtotal $
Total
of current savings, other liquid assets,
existing life insurance, and CPP Death
Benefit ($2,500) $
New
capital required for DAY ONE NEEDS $
INCOME
OBJECTIVE:
Based on a study by the Bureau of Labor Statistics Consumer Expenditures Survey, the following are typical income objectives in order to permit a family to "remain in their own world" after the death of a wage earner. Assumption is the mortgage on residence is paid or a rent fund has been established and educational expenses are provided for separately.
Annual Gross Income % of Gross Income Required
Two income families at all income levels 70%
Present
Annual Income- $
Income
Objective (_______% of above)- $
Anticipated annual government benefits $
Other
income- $
TOTAL INCOME SHORTAGE.
(if negative, there is no income shortage) $
What rate of return assumption would you like to use for an investment pool that could be used to "provide the income required"?
New
capital required for DAY ONE NEEDS
Click
this button to calculate the total
amount of life insurance you need.
TOTAL
NEW CAPITAL REQUIRED
