Some families choose to have one parent work outside the home while the other stays home to take care of children. Other families are forced into such a situation by limited childcare availability or other circumstances. In either case, most people would agree that the wage earner in any family should have life insurance protection. After all, how would the family survive without a breadwinner’s income?

What About the Spouse at Home?

If something were to happen to a stay-at-home spouse, it would be emotionally devastating for the surviving spouse and children. There are, of course, many psychological repercussions of such a tragic loss to a family. But there could also be a tremendous financial impact, as well.

During the difficult adjustment time, there could be a real need for someone to help out in caring for the children and home. Often, friends or relatives will step in to assist during the first few crucial weeks. But eventually, they will need to return to their regular lives—and the surviving spouse will need to return to work. At that point, the only recourse may be to hire professional services—which could present a whole new set of problems.

The Value of the Homemaker

While everyone recognizes the vital role of the family homemaker, few people stop to think about the literal value of the services performed by the stay-at-home spouse. This includes childcare, looking after the home, preparing meals, and many other time-consuming activities, such as carpooling, laundry and grocery shopping. All told, the financial equivalent of the vital services a stay-at-home spouse provides can amount to tens of thousands of dollars a year.

That’s why it’s crucial for a stay-at-home spouse to have his or her own life insurance protection. It’s hard enough for a family to deal with the emotional repercussions of losing a parent/spouse. It shouldn’t be compounded by having to grapple with the financial hardships such a loss can bring, as well.

Your Life Insurance Choices

There are two basic types of life insurance protection. Term insurance provides affordable coverage for a specific number of years. This is often the choice when protection needs are high for a limited period of time and affordability is an issue. The other option is permanent life insurance. Permanent life insurance provides protection for your entire life (provided premiums are paid) and accumulates cash value tax-deferred. This cash value can be borrowed against in times of need—such as for funding education, buying a home, retirement—although any unpaid loans accrue interest and will also reduce the policy’s cash value and death benefit. There are pros and cons to each type of insurance protection and the best option for you depends on your needs. Your life insurance agent can explain the choices available to you.

The Advantages of Riders

Policy riders—available with both term and permanent life insurance—enable you to customize your policy, lock in additional insurance coverage for down the road, or obtain other important benefits. By adding riders to your life insurance policy, you create a policy that can meet your changing needs and grow along with you and your family.

Don’t Hesitate

It can be very easy to overlook the significance of the financial contributions of a stay-at-home spouse—that is, until the person is gone. The loss of a parent is hard enough on a family; purchasing insurance coverage for a stay-at-home spouse can help ensure that it doesn’t become a financial hardship as well.

For more information on life insurance, please contact Lonnie Goldman, MBA, CLTC, LUTCF, Agent, New York Life Insurance Company, at (631) 391-5823.

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Tags: Insurance, Life Insurance, Spouse

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