Stay-at-home parents are the unsung heroes of the household. They may not be part of the traditional workforce with a corner office and a staff of bustling assistants, but they keep the family functioning. They perform the duties of a housekeeper, chef, chauffeur, CFO, and COO to name a few. Yet, many of these stay-at-home warriors think that because they don’t receive a paycheck, they don’t need a life insurance policy.
Nothing could be farther from the truth. Even though they aren’t contributing to the family income, their loss would not only create an emotional impact but could cause a disastrous financial situation.
Choosing the right life insurance can be confusing. When you’re ready, our caring, professional team of expert agents here at Your Policy will make the process as uncomplicated as possible. The following information will help you to understand why it’s a good idea for a stay-at-home parent to have life insurance.
Why a Stay-at-Home Parent Needs Life Insurance
Cover Household Expenses
The stay-at-home parent requires a varied skill set the commands serious worth. As new demands on a parent’s time are arising every day, market value will only increase.
Salary.com, in its annual Mom Salary Survey (this could be either parent), provides a list of a few of the many job titles that are performed by a stay-at-home parent.
- Chief Financial Officer.
- Chief Operating Officer.
- Logistics Analyst I.
- Laundry Manager.
- Kitchen Manager.
- Public School Teacher.
- Facilities Manager.
- Meeting/Event Manager.
- Kitchen Manager.
In its 2021 survey, the same website says that a parent who stays home would earn $184,820 per year for these roles.
Help With Child Care
According to a report from Child Care Aware of America, in 2019 parents paid an average of $26,102 to $18,442 in child care expenses. A spouse whose job requires long hours and extended travel could be hit hard with these costs. Think about this when you’re choosing a life insurance policy.
The Cost of Education
If children are homeschooled, the cost of education will have to be considered. If private school is your choice, you’ll need to factor in costs of approximately $10,700 for one child. That does not include fees, extracurriculars, and supplies.
A life insurance policy can also help pay for future college expenses. According to College Board’s Trends in Higher Education, college tuition has risen 1.1% in 2019-20 for public universities and 2.1% for private schools.
The National Funeral Directors Association reports that the average cost of a funeral in 2019 was $7,640. Considering the expenses for running your household, child care, and education, this is yet another major financial setback that your family will have to absorb. A life insurance policy will offset these costs.
How Much Life Insurance Do I Need?
Everyone has different needs and lifestyles. There isn’t a one-size-fits-all answer to how much insurance to buy. Well-known financial expert Dave Ramsey estimates that, in case of the loss of a stay-at-home parent, it would take a $400,000 – $500,000, 20-year term policy to keep the household running. After that time the kids are typically grown and on their own. You’ll no longer need the coverage.
When you’re deciding on a policy, think about three major areas: childcare, education and household functions. Using these as a guideline will help you more clearly determine your needs. The agents at Your Policy understand your needs and will simply and easily be able to explain different policies, save you money, and give you the peace of mind of knowing that you’re making the right decision. In the meantime, enjoy every moment. Chances are that you’ll be around to see your kids graduate from college and move forward with their lives, but it doesn’t hurt to be prepared.