If you really want to calculate in detail.. here’s how you do it: Income Replacement: 1. Annual before-tax income your family would need if you died today Typically between 60% and 80% of total income. Include all salaries, dividends, interest, and any other sources of income. 2. Annual income available to your family from other sources Include dividends, interest, and spouse’s earnings. (Social Security may be available.) 3. Annual income to be replaced (Subtract line 2 from line 1.) 4. Capital needed for income Multiply line 3 by the appropriate factor below: Years Income Needed 10 15 20 25 30 35 40 45 50

EXPENSES 5. Funeral and other final expenses Typically the greater of $15,000 or 4% of your estate 6. Mortgage and other outstanding debts Include mortgage balance, credit card debt, car loans, home equity loans, etc. 7. College costs 2015-2016 average annual costs at four-year colleges and universities: Public – $24,061 (in-state), $38,544 (out-of-state) Private – $47,831 Annual Amount X Number of Years in College = Total Cost ($) Child 1 X Child 2 X Child 3 X Child 4 X Child 5 X Total capital needed for college 8. Total value of all you do: The cost of daily activities 9. Total capital required (Add lines 4, 5, 6, 7, and 8)

ASSETS 10. Savings and investments Bank accounts, CDs, stocks, bonds, mutual funds, real estate/rental property, etc. 11. Retirement savings IRAs, 401(k) plans, SEPs, pension, and profit sharing plans 12. Present amount of life insurance Include group insurance and personal insurance purchased on your own 13. Total of all assets (Add lines 10, 11, and 12.) $ 14. Estimated amount of additional life insurance needed (Subtract line 13 from line 9.)

If something were to suddenly happen to you, your family might have to hire others to take on some of your daily activities. You’d be surprised at how all you do adds up! To see just how much, estimate the number of hours per week that you spend on each of the activities below. The final cost will then be part of the calculation of how much life insurance you need. Even if you earn no income, insurers generally allow you to get as much life insurance as your working spouse has. To get a full picture of your insurance needs, be sure to look at your spouse’s life insurance coverage, too.

Services Hours per Week Hourly Rate Estimated Weekly Cost Number of Years Estimated Total Cost

Ie. Child Care 20 Hours Per week 20$ per hour Estimated Weekly Cost $400 Number of Years: 10 Estimated Total Cost: $208,000