Bob and Sally have three children and called you to review their life insurance needs, Based on the information below, calculated the amount of life insurance Bob requires.

Sally’s After-tax income (last calendar year) $45,000 

Bob’s After- tax income (last calendar year) $55,000

 Joint Investment $150,000 

Sally’s RRSP’s $70,000 

Bob’s RRSP’s $65,000 

Bob’s Vehicle $50,000 

Sally’s Vehicle $35,000 

Primary Residence $1 Million 

Cash $35,000

 Mortgage $485,000 

Jewelry $45,000 

Antiques $30,000 

Line of Credit (loan) $55,000 

Credit Cards $20,000 

Personal loans (cars, etc.) $45,000 

Education Costs $115,000 

Funeral Costs each $20,000

 Continuing household expenses $60,000 

• They are beneficiaries of each other’s RRSPs 

• They would not liquidate the investment portfolio which generates $5,000 annually 

• Investment rate are at 6%. • Inflation is 2.5% 

• Tax rate on investments is 20% 

• The antiques and jewellery would not be liquidated upon the death of one. 

• They would sell Sally’s vehicle in the event of either of their deaths 

• They would like the calculation based on a 20-year period.