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					                LIFE INSURANCE NEEDS ASSESSMENT OPTIONS

                Option 1: The Expense Needs Formula

                The Expense Needs formula itemizes your family needs to determine how much insurance is necessary.


                First, consider the following items, enter a value for your situation and calculate the total:


                                                                               Guidelines                                         Your Need

                Expense Category
                Funeral Expenses                                               Usually $5-15k
                Legal Fees                                                     Set by court
                Estate & Gift Taxes                                            A % on estates over $600,000
                Business Buy-out                                               Your percentage of business
                Probate Fees                                                   Authorized by probate courts
                Medical Deductible                                             Consider your deductible ceilings
                Emergency Fund                                                 6-9 months expenses
                Mortgage Expense                                               Mortgage balance
                Rent                                                           Rent for 10 years
                Debts & Loans                                                  Enough to pay all debts
                College                                                        Total projected college costs
                Child Care                                                     Total from infant until school
                Private Schooling                                              Costs until college
                Maintenance                                                    Cleaning and repairs for 10 years
                                                                                                                          Total: $                                  -


                Next, calculate your assets:

                Asset Category                                                                                                    Value
                Bank and Savings Accounts
                Surviving Spouse Projected Income
                Social Security Survivorship Benefit
                Current Life Insurance
                Other Assets
                                                                                                                          Total: $                                  -


                Then calculate your approximate coverage needs:


                Total Expenses minus Total Assets (from above)                                                   Coverage Need:   $                             -




                Option 2 - The Income Replacement Formula
                The Income Replacement Formula is based on your annual income and is used if you’re still working. There are a couple of different versions of this
                method.

                First, if you’re already retired, include your pension if it ends at your death. Simply multiply your annual income by how many years you want your
                family supported (usually until you retire). It would look like this:

                                                                                                                                  Amount
                Annual Income
                Number of years until retirement                                                                      X
                                                                         Approximate Additional Life Insurance Required: $                                          -




                Option 2a - Income Replacement Formula
                Another income replacement method is to multiply your annual income times 10. It would look like this:


                                                                                                                                  Amount
                Annual Income
                Number of years until retirement                                                                      X                                             10
                                                                         Approximate Additional Life Insurance Required: $                                          -




                Option 2b - Income Replacement & Mortgage Payoff Formula
                One last income replacement method is to multiply your annual income times 5, and also add in the balance of your mortgage. It would look like
                this:

                                                                                                                                  Amount
                Annual Income
                Number of years until retirement                                                                              X
                Balance owed on your mortgage                                                                                 +
                                                                         Approximate Additional Life Insurance Required: $                                          -




Benefitsphere                                  For more information contact info@benefitsphere.com or 813-891-1800                                                       9-2006

				
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