***PLEASE DO NOT JUST COPY AND PASTE FROM OTHER ANSWERS. PLEASE EXPLAIN ANALYSIS AND SHOW ALL WORK/EXCEL FORMULAS**

Zack and Mary are 36 and 34. Zack earns $102,000 per year. Mary is a stay-at-home mom with 2 children, ages 10 and 7 and baby on the way.

Zack wants to buy life insurance and needs to know what kind he should get. He gives the following information:

Current salary: $102,000 Annual salary increase: 3.0% Retirement Age: 67 Expected inflation rate: 3% Final expenses: $30,000 Income Tax bracket: 25% Monthly social security benefit per child until the child reaches 18: $3,200 College education costs $25,000 per year per child in todays dollars starting at age 18 for four years. Education inflation rate: 5% Monthly income needs for spouse until last child is age 22: $5,500 Personal Consumption: 20% of income Investment returns expected to be 6% Mortgage and debt repayment (as it stands today) is: $285,000

Analyze his insurance needs using:

1. Human-Life Value Approach

2. Needs Approach

3. Capitalized Earnings approach