Life Insurance for a Stay-at-Home Parent
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Read more about the differences between term and whole life insurance here. Anyone with someone who depends on their income is a good candidate for life insurance. Apply for up to $1.5 million in term life coverage with Bestow. This is whoever would receive the death benefit in the event of the insured’s death. Here, you’ll find the top questions people just like you are asking.
Here, we’ve gathered some helpful info on some of the most common life insurance coverage options which may not require a medical exam. Many companies offer an indicative quote online, but then refer applicants to an agent in order to finish the application process. Other online life insurance options may still require a medical exam for certain coverage amounts or applicants.
What debt (good and bad) do you have?
Because of the cash value and death benefit that can be guaranteed for your entire life, whole life insurance is more expensive than term insurance. And hired household help, the idea of paying college tuition in a single-earner household can be incredibly daunting. However, the right coverage could help ease the burden of tuition costs if you were to pass away. Homemakers tend to do more than just care for children, even though that’s a full-time job in and of itself. Most stay-at-home parents do things like laundry, house cleaning, running errands, scheduling, and more. Thankfully, you can get enough life insurance to cover the loss of a stay-at-home parent without breaking your bank.
Whole life insurance is much more expensive than term life insurance but lasts for your entire life without expiring. Whole life insurance also has a cash value component that you can use to bolster your finances if you need more purchasing power. If you want an insurance policy that doesn’t expire and has a high cash value, you might find that it’s worth it to spend more on a whole life policy. Getting a permanent life insurance policy when you’re young and healthy means you’ll have lifelong coverage. Then you won’t have to worry if later on you develop a health condition that would make it hard or even impossible to get life insurance. Parents can check with local daycare centers and other providers to get a sense for potential costs per child.
How much money do you have saved?
As a simple number, a general rule of thumb is to buy between $300,000 and $500,000 0f life insurance for a stay-at-home parent. Here is a life insurance calculator meant to help a nonworking parent decide how much coverage they may need. The laddering strategy is ideal if you have different financial obligations you want to cover but don’t want to pay expensive premiums for one large term life insurance policy. If you would like you and your spouse to be covered under the same policy, you may consider a survivorship life insurance policy. This is a policy that covers two individuals and functions similarly to a universal life insurance policy. However, it only pays the death benefit when the second person dies.
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Life Insurance Calculator
Knowing that you have taken a step to protect your loved ones may even make the hard work of parenting a little less stressful. You’ll want enough life insurance to replace the income you expect when you return to the workforce so your family can continue living the lifestyle they’re accustomed to. By getting ample coverage now, you can lock in a lower rate than what you’d pay if you waited to buy more coverage upon returning to work. Having kids means having bills, from early childcare costs for young children to higher education for older kids. Their financial needs are unpredictable and often come by surprise. We believe that everyone should have access to the financial protection that life insurance can help provide, and that it should be convenient, affordable, and fast.
Your premium rate is determined by a number of factors including your age and health, often with a medical exam. The rate you get at 25 will probably differ significantly from the rate you get at 35. Most people start to think about life insurance when they start a family or buy a home, but the truth is, it’s always a smart time to start buying life insurance. That’s because, typically, the most affordable time to buy is now. For most people, life insurance rates get more expensive as you age. Life insurance policy and rest easier knowing your family’s financial future has a little coverage.
Who Needs Life Insurance – How It Works, and When You Should Have It
Since term life insurance is the best option for most families, that’s what we will focus on. Of course, childcare is a huge expense for a working parent. You may even be able to do without a second car in your family if you stop working. And what about lunches out during the workday, work clothes, extra haircuts, and other small expenses that add up over time?
Guaranteed universal life insurance is essentially a term life insurance policy that can last your entire life. This ladder life insurance strategy is more affordable over the total span of 35 years versus purchasing one 35-year term policy with $400,000 in coverage. And this is because when the individual policies end, the policyowner no longer has to pay those premiums. If you have life insurance coverage through your employer, you can subtract this coverage amount. If you already own an individual life insurance policy and plan on keeping it (versus replacing it with the one you’re currently considering) you can also subtract this amount.
To find out how much life insurance you may need, follow the steps below and our life insurance calculator will do the rest. Your savings and/or current life insurance total more than your needs. If you want to exclude your savings or life insurance from the assets your family could spend, please lower the amounts input.
You have to do a lot of work to take care of the kids and keep the household running. Consider the functions you will need to handle yourself if your spouse passes away. The two of you may also want to take into account paying off a home loan, as this will free up money each month and make it easier for the wage earner to take care of the kids. After you’ve come up with the yearly figure to replace mom’s duties, you’ll want to multiply that amount times at least the number of years until all kids are out of the house.
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