Being a stay-at-home parent may be the toughest job in the world.
Beyond being responsible for every detail of a tiny human's life, these superheroes play a number of vital roles (usually at once) that make a family truly whole. Day in and day trip, the children are looked after, the debts get paid, the house stays functional, clean clothes are available to wear – the list goes on and on.
There's a misconception the only individual who needs life insurance is the primary breadwinner from the household. They're the ones who buy an income on the day-to-day basis in the end, right?
This couldn't be more wrong.
Have you ever stopped to think just how much would it cost to cover the services a stay-at-home mom or dad provides? The national average income for all the work a stay-at-home parent accomplishes would equate to a lot more than $162,000 if your family had to outsource everything (and pay the much-deserved overtime which goes with it), according to Salary.com's calculations.
But being reminded not to take stay-at-home parents for granted is just part of the equation. Another, and arguably more essential, part: How to be sure that your family is financially protected if that person were no longer around.
The financial contribution of the stay-at-home parent
The cost of kid care in America is staggering. While a stay-at-home parent does not only take care of children, it's the expense that's easiest to understand its financial impact.
The average annual cost of center-based infant care in the U.S. is $11,959, based on Child Care Aware. This amount makes up about more than 12 percent of the median married-couple family income – well over the Department of Health and Human Services' (HHS) recommendation that day care should cost no more than 7 percent of household income.
That's a lot of numbers and percentages to take into account when determining the financial contribution of a stay-at-home mom or a stay-at-home dad (and we've only touched on child care). Thankfully, sites like Salary.com have created a calculator where you can input the number of hours spent on housework, day care, home maintenance, cooking, driving, along with a host of other tasks to find a comparable annual wage for that hours you work in your own home. It even takes overtime pay into consideration.
Why life insurance coverage may be essential for a stay-at-home spouse
The purpose of life insurance coverage is to protect the people you like most financially. If your stay-at-home parent passes away, this is a significant financial hit for just about any family to take.
A life insurance plan payout can be a safety net that helps your survivors shoulder the financial burden of the death. The payout itself (called a death benefit) is the amount of money the life insurance provider would pay your beneficiaries if you died as the policy is within force. Your beneficiaries can use the policy's death benefit for several financial needs – to assist cover funeral expenses, meet day-to-day living expenses or arrange for the future, to name a few.
Term life insurance is a great choice to financially protect your loved ones because the coverage is usually very affordable. For instance, a 20-year, $500,0000 Haven Term policy, from MassMutual, for any 35-year-old woman in excellent health starts at $20.32 monthly.
Choosing the correct quantity of coverage for any stay-at-home parent
At Haven Life, which sells life insurance that's issued by our parent company MassMutual, a stay-at-home parent is eligible to purchase coverage as much as or comparable to the total amount the significant spouse has from the life insurance company.
Why? In general, life insurance coverage companies have to limit coverage on anyone to a level that makes sense for their financial situation. When it comes to a stay-at spouse, it’s not easy to quantify their contribution towards the home, but it is a fair assumption that each partner contribute to the household equally.
For example, if you are a stay-at-home parent and your partner has a 30-year, $500,000 policy, you qualify for up to that quantity in coverage with a Haven Term policy. The important point is the fact that both partners need to have coverage.
So, here's what you may expect.
Buying life insurance if you're a stay-at-home spouse
Buying life insurance coverage for your spouse or partner is easier now than ever before due to transparent, no-nonsense online life insurance coverage processes like those at Haven Life.
We have created an engaged, online experience that will ask you just the questions that are really essential to determine term life insurance coverage eligibility.
During the internet application process, we'll inquire about your way of life, personal health history, family health background and fact check it with third-party vendors such as the Medical Information Bureau, DMV, and Social Security Administration to make sure all is accurate. This is not any more information than is required by other insurers; we just analyze it in real-time instead of during the period of several weeks.
With this insurance policy, be sure that the salaried spouse is covered first (by life insurance coverage company) to be able to get the equal or less amount of coverage. Then apply for coverage amount that's at or comparable to the wages of the working partner. Be truthful and set your earnings as zero as well as your occupation like a stay-at-home parent.
This real-time application processing is when we will offer an immediate decision on coverage eligibility. It is a true anywhere/any device life insurance coverage process. If an underwriter has a question regarding your application, they will inquire through email on the structured form you can access easily on your smartphone.
The only area of the shopping process that won't be on the internet is the medical exam.
Some qualified, healthy Haven Term applicants up to the age of 45 may be able to skip the medical exam entirely through our InstantTerm process.
Once an online life insurance application is submitted, we will know whether a medical exam is needed to verify that your health is really as reported in the answers provided. Note: It is essential to be truthful when completing the applying. Issuing the insurance policy or paying its benefits depends upon the applicant's insurability, based on their solutions to the questions in the application, and their truthfulness.
If a medical exam is needed, you will have 3 months go and are usually covered in that time. Once we obtain the medical exam results back, we'll give back a final offer with your real, approved rate.
If a medical exam isn't needed, you'll receive a final offer upon submission of the application, and once you e-sign, you're done. No phone interviews. No faxes. No nothing. You're done. Have a pat on the back for helping to protect your loved ones financially.
Enjoy peace of mind
The concept of leaving behind your family is unfathomable. We all know. However, get yourself ready for the unexpected doesn't make it any sooner.
Term insurance coverage could be a major factor of that sometimes-difficult preparation plan for a stay-at-home mom or dad. It's a selfless service (along with all the other selfless services they already provide) that provides not only protection for their loved ones but reassurance.