Why A Stay At Home Spouse Needs Life Insurance
Many times, when considering life insurance, people only think about purchasing coverage for working spouses
. Unfortunately, this mistake leaves families vulnerable to severe hardships if a stay-at-home parent is not covered as well. Stay-at-home home parents tend to be overlooked because they are not bringing in an income. However, when it comes to term life insurance, they should receive at least the same coverage as the employed spouse.Why These Spouses Need Life Insurance
The most important job performed by these moms and dads is child care. When there are young children, some families prefer to have the child stay with a parent instead of being in daycare. They no longer have a salary, and some monthly expenses are a bit higher with more people at home, such as the extra water and electricity that is used.
Depending on how many children there are, the costs to cover this kind of care in the case of death can cost hundreds to thousands each month. Of course, the kind of daycare used will make a difference. There are home daycare owners that offer more one-on-one time with a child, or daycare centers that have more resources to provide toys and teaching; the price varies as much as the service. Nothing can replace the time children will spend with their parents. However, if enough insurance is purchased, the help of a childcare service will lessen the burden on a parent should something happen to the other.
Household Tasks
There are endless chores to do around a house to keep everything and everyone in order. Most of the time, the chores tend to fall on the spouse who is not working. While childcare may be affordable with the current salary, finding someone to help with all these tasks will be more costly. The chores themselves range from accounting, cooking, cleaning, organizing, yard work, maintenance, grocery shopping, and more.
Finding or hiring one person to do all of these jobs will be difficult, if not impossible to do. However, with the right amount of money, the task becomes easier to accomplish. Hiring a maid to come in and clean a few times a week could be covered in the life insurance policy. A cook or chef may be available to cook for your family once a week and freeze everything to make preparation during the week easier. Yard work may often be covered by a landscaper, while pool maintenance could be paid for as well. On one person's salary, it might be almost impossible to get help with all of these chores.
Unemployed spouses are often undervalued as far as money goes, but this has little to do with what they are actually accomplishing, and more to do with their lack of a current paycheck. They have to be taken into consideration when term life insurance is purchased for anyone in the family. The monetary value of the work these parents do around the house sometimes far outweighs the paycheck of the other spouse, once everything is considered.
The average stay-at-home parent is considered by Salary.com to be worth $134,000 per year. Have your term life insurance consultant help you estimate a monetary value that will secure your current lifestyle in the case of a spousal death. It could be one of the best decisions you make.
Anticipated Income
Returning to work after taking care of the children is a dream for many unemployed parents. Getting back to a social life, a place where they can do what they went to school for, and contribute to family finances is what many want to do.
Many times, families are looking forward to and depending on receiving a second income when the kids are older. Consider the family that has an ARM mortgage; the interest rate may increase around the time the second spouse would go back to work. Earning extra income after a few shorts years of being away from work can also help pay off student loans, credit cards, or vehicle debts. Some of this debt may have piled up from the years of being home, buying kids' clothes, diapers, and dealing with other early childhood expenses.
However, if a death occurs, this income won't ever be available to pay off such bills. While everyone hopes this kind of thing won't happen to them, it is always better to plan ahead in case it does.
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