Could you imagine what the total cost would be of having your own personal chef, nurse practitioner, counselor, bookkeeper, decorator, chauffeur, cleaning lady?
It would cost a ton!
If you’re a mom, you’ve probably just realized that I just listed some (definitely not all) of your daily duties of being a mother.
It is very common in many households where the breadwinner has purchased plenty of insurance to cover them, but what about the stay at home mom who performs many of the above tasks on a daily basis?
The fact remains is that many moms either don’t have adequate life insurance coverage on them or, even worse, don’t have any life insurance coverage at all!
Trust me when I say this: most dad’s wouldn’t survive one day without you. My wife is the CEO of our household and without her kids would not get fed, homework would not get done, and I would be a complete wreck.
Salary.com published a recent study that estimates that stay at home moms work on average 94 hours a week and are worth an equivalent salary of $113,000.
Personally, if I told my wife that that was all she was worth I’m fairly certain I would get a pretty disgusted look.
And that’s just for stay at home moms. What about moms that have joined the work force?
Now that we have agreed that moms need life insurance, here are some other considerations you should have before you buy your policy.
How Much Life Insurance Do You Need to Buy?
There are many rules of thumb that you can follow when buying life insurance. The trick is tailoring these rules of thumb to your own personal situation.
Rules of Thumb to Consider:
- 10 times salary
- 20 times salary
- Sum of all your debts
The main thing that matters when determining how much you need is how much you can afford.
Don’t become life insurance poor!
Basically, that means you shouldn’t be breaking the bank just to be able to your afford your life insurance premiums.
The bright side is that the rates on women in regards to life insurance is sometimes 10% to 20% cheaper than men.
Women are generally healthier than men and their rates on life insurance premiums represent that.
If you’re not exactly sure how much life insurance to buy, there are some very handy calculators on the web that can help you determine how much you actually need.
What Types of Life Insurance Should You Consider?
An ongoing debate exists between whether to buy term or permanent insurance otherwise known as whole life.
Let’s look at the differences of term life vs. whole life to see which one might make sense for you.
Term life insurance will cover you for the term that you’ve purchased. For example, if you buy a 20 year term policy then you will be covered for that 20 year period and it expires afterwards. Term life insurance is the most affordable type of life insurance that you can buy.
Whole life insurance does not expire and gives you coverage for your “whole life”, or for as long as you keep paying for the premium. Whole life also offers a cash value component meaning that after years of paying into it you can accumulate monies that you might be able to borrow off of to use to your preference.
The biggest disadvantage of whole life is the cost. You can expect to pay 10-20 times more for whole life insurance for the same coverage you would get with term.
If you’re budget is tight, I would stick to a cheap term life insurance policy.
Going Shopping for Life Insurance
Your safest bet is to go with an independent agent that’s able to use multiple carriers.
Be careful on the term independent though as sometimes it gets misused. Preferably you want an independent agent that can use several different carriers.
Why an independent agent? Because if you do have some sort of medical condition, an independent agent can shop it with multiple carriers on your behalf.
What is the monetary value of the tasks performed by the mom in your family and what insurance do you use to protect her?