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by: Alessandra Vandervort


Marketplace > James Madison University > Business > GBUS 160 > BUS DECIS MODERN SOCIETY C1CT
Alessandra Vandervort
GPA 3.66

Cathleen Snyder

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About this Document

Cathleen Snyder
Class Notes
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This 19 page Class Notes was uploaded by Alessandra Vandervort on Saturday September 26, 2015. The Class Notes belongs to GBUS 160 at James Madison University taught by Cathleen Snyder in Fall. Since its upload, it has received 75 views. For similar materials see /class/214113/gbus-160-james-madison-university in Business at James Madison University.




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Date Created: 09/26/15
Life Insurance Basics Life Insurance 0 Whole Life Insurance Life insurance that covers for the life of the applicant and accrues cash value 0 Term Life Insurance Life insurance that covers for the term life of the Policy and does not accrue cash value 0 Universal Life Insurance Life insurance that covers for the life of the applicant and accrues cash value More exposure to the market 0 Which do you choose Whole Life Term Life Death Bene t 0 Death Bene t Cash ValueBuilds using an No Cash Value interest rate determined by Coverage for the life of the the CompanY term policy Coverage for the life of the 0 Common Terms are 5 I0 applicant IS 20 30 years Level premiums 0 Level premiums for the Costs more than term term 0 Costs less than whole life Life Insurance Whole Life Death Bene t Cash ValueBuilds using an interest rate determined by the company Coverage for the life of the applicant Level Premiums Universal Life Death Bene t Cash ValueBuilds at an interest rate according to the market Coverage for the life of the applicant Flexibility with your cash Life Insurance Illustration Salaries 42000 40000 Mortgage 300000 300000 Student Loans l5000 l5000 Credit Card Debt 2000 2000 Car Loans M M Total Insurance 365000 363000 Needed 20YearTerm Life 2792 a month 2383 a month 30YearTerm Life 42 I 3 a month 3455 a month Whole Life l8894 a month l6495 a month Cash at Age 65 246008 2 I 2030 Universal Life 20805 a month l6729 a month Cash at Age 65 22 783 80880 Frequently Asked Questions What about life insurance through work Work Life insurance How much is too much insurance Too Much insurance Why pay that much more for the same dollar amount Whole life vsTerm life Which EQJQMJQEl f use tobacco how much could it affect my premium Tobacco Use Who gets the death bene t when I die Why take out life insurance now and not later when I can afford it When would I need to increase my life insurance Why take out life insurance period Life Insurance in your Financial Plan iLife Insurance is within the first step in your Financial Pyramid The ability to protect your assets in the event that the unforeseen happens should 7 4 be priority number I In other words you would be taking care of the ones you l leave behind that will take on your debt Emula qn ITu Shelters 39ltReal Estate How Much Should I Pay Pay the right amount of premium for the right amount of coverage Take full advantage of a 40 l k savings plan through work As long as the company is matching your funds Make yearly IRA contributions whether it be Roth lRA s orTraditional IRA s Maximum contribution level for under the age of 50 is 6000 An39ierican Fund39s iii m il i Buying a Home Watch your LENDER Follow the rule of 28 36 No more than 28 of your salary goes to pay for your house Your mortgage plus your debts doesn t exceed 36 DON T GO OVERYOUR BUDGET Date Investments Dividen lncom 9II978 980 990 995 998 Ill2000 Ill2002 Ill2005 Ill2006 Ill2007 2l2008 Totals Investments Average Return 5000 5000 5000 5000 5000 5000 5000 5000 5000 5000 0 50000 Balanced 208 d Capital Gains Total Value e 0 0 47 2 570 52 746 6233 498 65300 7833 6 98 380502 0 I79 56870 6995 8 3453 77089 940597 3255 3857 753297 8452 4035 99032 2356 5656 37828 27438 70009 5 l 57 I 2 3403 4752 36 834 252725 548584 36834 Growth Growth and Fundamental Income Investors Work Life Insurance 0 Primarily will be structured as a Group Insurance policy 0 Only available while you are working for the company 0 Usually the amount of coverage is a percentage of your yearly salary Too Much Insurance 0 25 year old single Male that has no mortgage or debts and makes 30000 annually 0 Needs are income replacement and burial expenses Doesn t need 500000 of coveragewhen 50000 will suit 0 45 year old Married Male with 2 dependents that has a 500000 mortgage and other debts who makes 75000 annually 0 Needs are income replacement for his dependents mortgage replacement other debts and burial expenses This case shows the need for a larger dollar amount of insurance If this individual does NOT have the right amount of coverage then the family could stand to lose everything they have and have a change in lifestyle Whole Life Term Life 35389 a month 0 7668 a month CashValue atAge 55 259856 39 Enough coverage for a low monthly amount for the term Total amount paid after 30 years needed I 27 4003940 c Total Paid after 30 years At the end of 30 years you still 2760480 have coverage and cash value At the end of 30 years you do not have anymore coverage under this policy Which to chose 25 year Old Couple ll Ll Foundations of a Dynamic Business Environment What constitutes a business 3 Main Criteria Revenue Pr0fit Profit and Value Are they the same No Other organizations similar challenges Are these businesses HP Pfizer United Way Papa John s Habitat for Humanity Abercrombie amp Fitch Rockingham Memorial Hospital BBampT Factors of Production Natural ResourcesLand CapitalMachines tools buildings etcnot money Human ResourcesLabor InformationKnowledge Entrepreneurship Risk and Reward Basic Tenets of the Private Enterprise SystemCapitalism The External Business Environment Political Economic Legal Technological Social Competitive Global Issues Six Eras of Business History quot i The Colonial Period pre1776 The Industrial Revolution 17601850 The Age of Industrial Entrepreneurs late 1800s The Production Era through the 1920s The Marketing Era since 1950s The Relationship Era began in 1990s Shifting focus on which stakeholder group held priority status Quality of Life Standards of Living Influencing factors Disposablediscretionary income Political freedom Government provision of goodsservices Value of leisure Rewardssatisfaction


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