Should A Stay at Home Parent Have Life Insurance?

Should A Stay at Home Parent Have Life Insurance? July 3, 2012

I recently read a featured article on Forbes that really highlighted the underestimated aspects of financial planning for a family that has a stay-at-home parent.  If you’re family is a one-income family with a full time stay at home mom or dad, you realize how important it is to plan for emergencies that might keep the family from eating.  We build emergency funds in case the sole breadwinner loses their job.  We take out disability insurance on the employed spouse in case they get hurt and they’re unable to work.

These safeguards are good to have, but what about insuring the spouse that stays at home?  What financial measures do we take to make sure the family will function if something happens to them?

The Value of a Stay at Home Parent

There’s no hard and fast way to decide whether one spouse should stay home to manage the family or if both spouses should be employed in the workforce.  But when a family does decide for one of the spouses to stay at home, there’s a value to the work that’s done in the home.  Sometimes the value is monetary, like the savings on daycare each month.  Other values are non-tangible, like the ability to homeschool your children or to be there for every school event they have.

Recognizing the value is important because it reinforces the fact that without your stay-at-home spouse, your family might not be able to do the things that you place so much value on.

This is exactly why I agree with the idea of protecting your stay-at-home spouse with an appropriate insurance plan.

Insuring a Stay-At-Home Parent

It’s impossible to suggest a dollar amount for the value that a stay-at-home parent brings to your family, but you can think about all the expenses that would appear if they weren’t able to provide in the home.  That’s why it’s so important to take a out life insurance policy on both spouses. A $500,000 term life insurance policy on your stay-at-home spouse could cost you about $30 a month, assuming they’re about age 35 and in good health.  No amount of money can replace what your spouse brings to your family, but it’s simply foolish to be unprepared if something tragic happened to them.

The role of a stay-at-home parent is just as important as a working-parent and shouldn’t be overlooked financially. You can purchase cheap health insurance and still get great coverage. Take the time to discuss the emergency plan with your spouse and seriously consider a life insurance policy for the stay-at-home spouse if you don’t already have one in place.

Does your family have a stay-at-home parent?  Have you ever considered taking out an insurance policy that covers them?

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