Zachary Chen is a college student from Prescott, Arizona.

Soon to graduate, Zachary was approached recently by a life insurance agent, who set up a group meeting for several members of his fraternity. During the meeting, the agent presented six life insurance plans and was very persuasive about the benefi ts of a universal life insurance plan that his company calls Aff ordable Life II. Under the plan, the prospective graduate can buy $100,000 of permanent life insurance for a very low premium during the fi rst fi ve years and then pay a higher premium later when income presumably will have increased.

Zachary was confused after the meeting, as were his friends.

Armed with your knowledge from this personal fi nance book, you have been asked to respond to some of their questions.

(a) Do you think universal life insurance is a good deal for these people? Why or why not?

(b) How can the individual fraternity members decide how much life insurance they need?