How much life insurance do you need? Calculating needs $-$ Part$1$

Yvette and Tim Cohen are $52$ years old and have one son, age $14.$ Yvette is the primary earner, making $$80,000$ per year. Tim does not currently work. The Cohens have decided to use the needs analysis method to calculate the value of a life insurance policy that would provide for Tim and their son in the event of Yvette's death.

Yvette and Tim estimate that while their son is still living at home, monthly living expenses for Tim and their child will be about $$3,300($in current dollars$).$ After their son leaves for college in $4$ years, Tim will need a monthly income of $$2,750$ until he retires at age $65.$ The Cohens estimate Tim's living expenses after $65$ will only be $$2,300$ a month. The life expectancy of a man Tim's age is $82$ years, so the Cohen family calculates that Tim will spend about $17$ years in retirement.

Using this information, complete the first portion of the needs analysis worksheet to estimate their total living expenses.

Life Insurance Needs Analysis Worksheet

Name of insured

Tim and Yvette

Date

July $31,$

Cohen

$2015$

Step $1$: Financial

resources needed

after death

Annual living

expenses and other

napha

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