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FamilyWhen it comes to life insurance, many people are quick to buy coverage as working adults. This makes sense. Life insurance helps replace their income in the unfortunate event of their death. Some companies even provide a small policy as a benefit.

But what about the stay-at-home parents who aren't earning an income? To an outside observer, there's no loss of income if the stay-at-home parent passes away. There's no difference, right?

Take a closer look. What does that stay-at-home parent do for the family? Chances are, he or she isn't sitting watching reruns all day while a nanny and house keeper run the show.

Most stay at home parents:

  • Grocery shop, meal prep and cook.
  • Wash laundry and handle minor clothing repairs.
  • Shop for new clothes and switch out clothes each season.
  • Shuttle kids to and from school and other activities.
  • Oversee homework and help kids when they're struggling.
  • Mop, dust and vacuum the house.
  • Pay bills and schedule appointments.
  • Arrange to be home to when service or repair workers come.

Each of these tasks can take hours a week. Meals alone can take two to three hours a day. Now, what if you have to hire that out to a nanny at $10 an hour? Two hours a day times five days a week is $100. Add on another three hours a week for laundry, five for basic cleaning and an hour for accounting. That's nine more hours or $90. Then the twice-a-day school run, plus helping with homework each night. That's another ten hours a week or $100. Outsourcing the most essential household tasks for a family would cost $290 a week. That adds up to $1,160 a month or $13,920 a year. Let's say the youngest child is currently six. That leaves another twelve years until she's of adult age. All total, the family might spend $167,040 on these expenses. Inflation will increase this number.

These numbers might be more or less where you live. But the point is, a stay at home parent provides great economic value to their family. She or he needs to have a life insurance policy that will cover them.

The rule of thumb is to have at least a $250,000 policy on non-working partners. To determine how much you need, consider your family size and cost of living. Find out what it would cost to do the tasks he or she does for a year. Multiply that by ten and you'll have a good estimate of what you need. Your Exton life insurance provider can help you fine tune this number so you have enough coverage.

Posted 3:24 PM

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