Jason is a 45 years old Accounting Manager at Tiong Nam Holdings Berhad with a monthly income
Question:
Jason is a 45 years old Accounting Manager at Tiong Nam Holdings Berhad with a monthly income of RM8,000. He will be retired at the age of 60. His wife, Ann, is a 41 years old Financial Consultant at Maybank with a monthly salary of RM5,000. They live in Kajang with their 3 children Ariana (16 years old), Isaac (12 years old), and Joseph (10 years old). Recently, Jason's friend Phill died due to a heart attack and left his wife with 4 children without sufficient financial security. Due to that, Jason starts to think of his family's future if something bad happens to him. He has a few loan commitments that need to be settled in the next few years. He anticipates that his children will enroll to college or university by the age of 18 years old. Jason estimates a standard foundation and degree courses will take 5 years to be completed, which will cost him around RM80,000 for each child for their tertiary education. Therefore, Jason decides to take life insurance as a security for his family, but he is uncertain about the insurance amount needed.
Jason's Financial Details:
Savings Account: RM18, 520
Fixed Deposit: RM10, 000
Bond Merdeka: RM10, 000
Public Mutual Fund: RM100, 000
Shares: Petronas Dagangan Bhd: RM15, 850
Employee Provident Fund (EPF): RM281, 653
Social Security Organization (SOCSO): RM17, 025
House Loan: RM650, 000
Family Insurance: RM50, 000
Car Loan: RM55, 223
Based on Jason's financial details, estimate the life insurance needed by using the attachment provided. Please show all calculations on separated pages.
Cornerstones of Financial and Managerial Accounting
ISBN: 978-1111879044
2nd edition
Authors: Rich, Jeff Jones, Dan Heitger, Maryanne Mowen, Don Hansen