Dave is 50 on his next birthday, so it will cost him £4.56 a year to take out £1000 worth of cover. Suppose Dave wants to take out £10,000 of life cover, this will cost him £4.56 x 10 , in other words £45.60 a year.
Dave is paid monthly, so to get the monthly cost, we simply divide by 12, which gives a cost of £3.80. Dave pays tax at the standard rate of 20%, so the monthly cost to him after tax relief is £3.04
| Summary |
|
| Age next birthday: |
50 |
| Yearly cost per £1000: |
£4.56 |
| Yearly cost for £10,000: |
£45.60 |
| Monthly cost for £10,000: |
£3.80 |
| Monthly cost after tax relief: |
|
Dependants’ pensions
Dave could instead use the cover to provide his wife Jenny with a widow’s pension. The premium would cost exactly the same, but the amount of pension would depend on pension rates at the time, and there is no way of predicting this.
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If you are part time
