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Life insurance basics for families
What is term life insurance?
Term life insurance provides income protection. If you were to die, your life insurance policy would pay out a lump sum to family members named as your beneficiaries. Many financial advisors suggest having 10 to 20 times your income in life insurance to maintain your loved ones’ standard of living.
Learn more: Do All Parents Need Life Insurance?
Why do stay-at-home parents need life insurance?
The care that you provide your children is priceless. Life insurance cannot replace the love you give your family. But it can keep your family together after the unexpected death of mom or dad. Take a moment to appreciate all the household and caregiving tasks that you do for your family each day. If you were not there, who would take care of them? Would they need to be hired out or could another family member jump in? Childcare alone costs on average $18,000 a year per child in the USA. Traditionally people assume only the breadwinner needs insurance, but valuing the caregiving that the stay-at-home parent provides is best for families who wish to create financial stability.
Learn more: Life Insurance for a Stay-at-Home Parent
Why do single parents need life insurance?
You’re the sun, moon, and stars for your child. She relies on you completely for her financial and emotional well-being. As a single parent consider getting enough life insurance to cover your income, childcare, future education expenses, and your final expenses (your debt and memorial service). Consider who should be the legal guardian of your child if you were to die unexpectedly. Then, name a trust as your policy beneficiary to ensure that your minor child will receive the financial benefits you intend for them. Our care team of licensed agents have guided many single parents through these steps. We would be honored to help your family, too.
My spouse or partner has life insurance. Do I need it?
The goal of owning term life insurance is to protect your children from the loss of financial support that they rely on to have a happy and fulfilled life. It can cover everything from food to a prom dress. If you contribute to the household income that makes these possible, you need life insurance, even if you are not earning a paycheck outside your home. To maintain the lifestyle of your family, it’s best to insure both parents.
Learn more: Does Everyone Need Life Insurance?
Should my child have life insurance?
Many life insurance companies offer you the option to add a child rider to your term life insurance policy. These are inexpensive riders that insure all of your minor children. Adding a child rider also helps your children’s future insurability.
How does life insurance benefit your special needs child?
Many parents of children with disabilities have helped their child obtain life insurance by choosing Principal as their carrier when applying. Principal allows a special needs child to be covered by their child rider that can be later converted into a permanent policy.
Learn more about a special needs trust: Providing for a Loved One with Special Needs
How does pregnancy affect life insurance rates?
Learn more: How Does Pregnancy Affect Life Insurance Rates?
Is life insurance helpful for divorced parents?
If you are facing a divorce, know that term life insurance can be used to cover alimony or child support that you are due post-divorce. Setting up a policy on your ex-spouse with you as the policyowner is a great option to protect that income. Make sure that the policy is adequate enough to replace the money you would be receiving for alimony and/or child support.
Learn more: Life Insurance After Divorce
Helpful financial planning and budget advice for young families.
How much life insurance do you need?
Our easy-to-use calculator can help you figure out your action plan
Life insurance resources
Life insurance basics
Helpful advice for parents
Your love. Our life insurance.
We’d be honored to help you protect your family with the gift of life insurance