Appendix .1 Estimates of Social Security Benefits for the Three Major Social Security Programs Present Annual Earnings $65,000 $80,000 $35,000 $50,000 $95,000 $120,000 Monthly Retirement Benefits at Age 67 in Today's Dollars Per month Per year As a percentage of income Monthly Retirement Benefits at Age 67 in Future Dollars Per Month Per Year $ 1,480 $17,760 51% $ 1,890 $22,680 45% $ 2,260 $ 27,120 42% $2,450 $ 29,400 37% $ 2,640 $31,680 33% 2940 5 35,280 29% $12,440 $ 6,170 574,040 $ 7,860 $94,320 $ 9,550 $114,600 $ 10,410 $124,920 $ 11,200 $134,400 $ 1,330 $15.960 46% $ 2,000 $24,000 $ 1,690 $20,280 41% $ 2,040 $ 24,480 38% $ 3,060 $36,720 56% $ 2,280 $ 27,360 34% 3,420 $ 41,040 51% $ 2,460 $29,520 31% $ 3,690 $ 44,280 47% $ 2,720 $ 32,640 29% $ 4,080 $ 48,960 41% 5 $ 2,530 $30,360 69% 61% Monthly Disability Benefits If You Became Disabled in 2018 Individual benefit per month Individual benefit per year As a percentage of income Maximum family benefit per month Maximum family benefit per year As a percentage of income Monthly Survivor's Benefits if You Died in 2018 Individual benefit per month Individual benefit per year As a percentage of income Maximum family benefit per month Maximum family benefit per year As a percentage of income 5 1.040 1,560 18,720 29% $ 1,750 $ 21,000 $12,480 3656 26% $ 1,890 $ 22,680 24% 54,700 $ 52,800 56% 5 2,090 5 25,080 21% $ 4,870 5 58,440 49% $ 2,380 3.710 54,090 549,080 $28,560 $ 44,520 68% Life Insurance Needs for a Young Married couple Amy and Mack Holly from Rapid City, South Dakota, have been married for three years. They recently bought a home costing $212,000 using a $190,000 mortgage. They have no other debts. Mack earns $64,000 per year, and Amy earns $71,000. Each has a retirement plan valued at approximately $30,000. They recently received an offer in the mail from their mortgage lender for a mortgage life insurance policy of $190,000. Their only life insurance currently is a $22,000 cash-value survivorship joint life policy. They each would like to provide the other with support for at least five years if one of them should die. a. Assuming $13,000 in final expenses and $20,000 allocated to help make mortgage payments, calculate the amount of life insurance they should purchase using the needs-based approach. Also assume that both Mack and Amy would replace 75 percent of their individual current income for five years. Use a 5 percent after-tax, after-inflation rate of return for your calculations. (Use Appendix B.) Do not round your intermediate calculations. Round your answers to the nearest dollar. Ufe insurance needed (Mack): $ Ufe insurance needed (Amy): $ b. How would their needs change if Amy became pregnant? The input in the box below will not be graded, but may be reviewed and considered by your instructor De the Math 12-2 Life Insurance Needs for a Young Married couple Amy and Mack Holly from Rapid City, South Dakota, have been married for three years. They recently bought a home costing $212,000 using a $190,000 mortgage. They have no other debts. Mackeams $64,000 per year, and Amy earns $71,000. Each has a retirement plan valued at approximately $30,000. They recently received an offer in the mail from their mortgage lender for a mortgage life insurance policy of $190,000. Their only life insurance currently is a $22,000 cash-value survivorship joint life policy. They each would like to provide the other with support for at least five years if one of them should die a. Assuming $13,000 in final expenses and $20,000 allocated to help make mortgage payments calculate the amount of life insurance they should purchase using the needs-based approach. Also assume that both Mack and Amy would replace 75 percent of their individual current income for five years. Use a 5 percent after tax, after-inflation rate of return for your calculations (Use Appendix B.) Do not round your intermediate calculations. Round your answers to the nearest dollar Life insurance needed (Mack): $ Life insurance needed (Amy): $ b. How would their needs change if Amy became pregnant? The input in the box below will not be graded, but may be reviewed and considered by vour instructor Appendix B.1 Estimates of Social Security Benefits for the Three Major Social Security Programs Present Annual Earnings $65.000 $80.000 $25,000 $50,000 395,000 $120,000 Monthly Retirement Benefits at Age 67 in Today's Dollars Per month $ 1,480 $17,760 $1,890 $77,680 45% 2,260 $ 27.120 $ 7,450 79 400 $ 316 As a percentage of income 51% 4296 37% Monthly Retirement Benefits at Age 67 in Future Dollars Per Month $11.200 $ 6,170 $74,040 $7,860 $94.320 59,550 $114,600 $ 10,410 5124,920 $ 12,440 $149,280 Per Year $ 2780 52.650 $ 1,310 $15.960 $ 1.690 $20,280 $ 2,040 $24.480 $ 2,720 $ 32,640 $ 27.360 $ 29,520 349 29% $ 2.000 $ 3,060 $ 3.690 $ 4080 5 2.530 $30,360 $ 3.420 $41.040 $24,000 5 36,720 $ 44,280 S 48 960 6 ST Monthly Disability Benefits of You Became Disabled in 2018 Individual benefit per month Individual benefit per year As a percentage of income Maximum family benefit per month Maximum family benefit per year As a percentage of income Monthly Survivor's Benefits if You Died in 2018 individual benefit per month Individual benefit per ye As a percentage of income Maximum family benefit per month Macium family benet per year As a percentage of income $ 2,090 $ 1040 51240 31,560 519720 1.750 $ 21.000 5 1,890 522680 $ 25,080 36% 51310 $15.720 31% 53.210 538.570 295 26% $ 2380 5 4820 528,560 $ 3.710 $ 4.520 5 4,090 549.080 54,700 553,800 50100 S SO 68% Appendix .1 Estimates of Social Security Benefits for the Three Major Social Security Programs Present Annual Earnings $65,000 $80,000 $35,000 $50,000 $95,000 $120,000 Monthly Retirement Benefits at Age 67 in Today's Dollars Per month Per year As a percentage of income Monthly Retirement Benefits at Age 67 in Future Dollars Per Month Per Year $ 1,480 $17,760 51% $ 1,890 $22,680 45% $ 2,260 $ 27,120 42% $2,450 $ 29,400 37% $ 2,640 $31,680 33% 2940 5 35,280 29% $12,440 $ 6,170 574,040 $ 7,860 $94,320 $ 9,550 $114,600 $ 10,410 $124,920 $ 11,200 $134,400 $ 1,330 $15.960 46% $ 2,000 $24,000 $ 1,690 $20,280 41% $ 2,040 $ 24,480 38% $ 3,060 $36,720 56% $ 2,280 $ 27,360 34% 3,420 $ 41,040 51% $ 2,460 $29,520 31% $ 3,690 $ 44,280 47% $ 2,720 $ 32,640 29% $ 4,080 $ 48,960 41% 5 $ 2,530 $30,360 69% 61% Monthly Disability Benefits If You Became Disabled in 2018 Individual benefit per month Individual benefit per year As a percentage of income Maximum family benefit per month Maximum family benefit per year As a percentage of income Monthly Survivor's Benefits if You Died in 2018 Individual benefit per month Individual benefit per year As a percentage of income Maximum family benefit per month Maximum family benefit per year As a percentage of income 5 1.040 1,560 18,720 29% $ 1,750 $ 21,000 $12,480 3656 26% $ 1,890 $ 22,680 24% 54,700 $ 52,800 56% 5 2,090 5 25,080 21% $ 4,870 5 58,440 49% $ 2,380 3.710 54,090 549,080 $28,560 $ 44,520 68% Life Insurance Needs for a Young Married couple Amy and Mack Holly from Rapid City, South Dakota, have been married for three years. They recently bought a home costing $212,000 using a $190,000 mortgage. They have no other debts. Mack earns $64,000 per year, and Amy earns $71,000. Each has a retirement plan valued at approximately $30,000. They recently received an offer in the mail from their mortgage lender for a mortgage life insurance policy of $190,000. Their only life insurance currently is a $22,000 cash-value survivorship joint life policy. They each would like to provide the other with support for at least five years if one of them should die. a. Assuming $13,000 in final expenses and $20,000 allocated to help make mortgage payments, calculate the amount of life insurance they should purchase using the needs-based approach. Also assume that both Mack and Amy would replace 75 percent of their individual current income for five years. Use a 5 percent after-tax, after-inflation rate of return for your calculations. (Use Appendix B.) Do not round your intermediate calculations. Round your answers to the nearest dollar. Ufe insurance needed (Mack): $ Ufe insurance needed (Amy): $ b. How would their needs change if Amy became pregnant? The input in the box below will not be graded, but may be reviewed and considered by your instructor De the Math 12-2 Life Insurance Needs for a Young Married couple Amy and Mack Holly from Rapid City, South Dakota, have been married for three years. They recently bought a home costing $212,000 using a $190,000 mortgage. They have no other debts. Mackeams $64,000 per year, and Amy earns $71,000. Each has a retirement plan valued at approximately $30,000. They recently received an offer in the mail from their mortgage lender for a mortgage life insurance policy of $190,000. Their only life insurance currently is a $22,000 cash-value survivorship joint life policy. They each would like to provide the other with support for at least five years if one of them should die a. Assuming $13,000 in final expenses and $20,000 allocated to help make mortgage payments calculate the amount of life insurance they should purchase using the needs-based approach. Also assume that both Mack and Amy would replace 75 percent of their individual current income for five years. Use a 5 percent after tax, after-inflation rate of return for your calculations (Use Appendix B.) Do not round your intermediate calculations. Round your answers to the nearest dollar Life insurance needed (Mack): $ Life insurance needed (Amy): $ b. How would their needs change if Amy became pregnant? The input in the box below will not be graded, but may be reviewed and considered by vour instructor Appendix B.1 Estimates of Social Security Benefits for the Three Major Social Security Programs Present Annual Earnings $65.000 $80.000 $25,000 $50,000 395,000 $120,000 Monthly Retirement Benefits at Age 67 in Today's Dollars Per month $ 1,480 $17,760 $1,890 $77,680 45% 2,260 $ 27.120 $ 7,450 79 400 $ 316 As a percentage of income 51% 4296 37% Monthly Retirement Benefits at Age 67 in Future Dollars Per Month $11.200 $ 6,170 $74,040 $7,860 $94.320 59,550 $114,600 $ 10,410 5124,920 $ 12,440 $149,280 Per Year $ 2780 52.650 $ 1,310 $15.960 $ 1.690 $20,280 $ 2,040 $24.480 $ 2,720 $ 32,640 $ 27.360 $ 29,520 349 29% $ 2.000 $ 3,060 $ 3.690 $ 4080 5 2.530 $30,360 $ 3.420 $41.040 $24,000 5 36,720 $ 44,280 S 48 960 6 ST Monthly Disability Benefits of You Became Disabled in 2018 Individual benefit per month Individual benefit per year As a percentage of income Maximum family benefit per month Maximum family benefit per year As a percentage of income Monthly Survivor's Benefits if You Died in 2018 individual benefit per month Individual benefit per ye As a percentage of income Maximum family benefit per month Macium family benet per year As a percentage of income $ 2,090 $ 1040 51240 31,560 519720 1.750 $ 21.000 5 1,890 522680 $ 25,080 36% 51310 $15.720 31% 53.210 538.570 295 26% $ 2380 5 4820 528,560 $ 3.710 $ 4.520 5 4,090 549.080 54,700 553,800 50100 S SO 68%