Do Stay-at-Home Parents Need Life Insurance?
The short answer to that question is ‘yes.’ But you may be asking yourself why?
Many choose to purchase life insurance should the breadwinner or winners (given the cost of raising a family today) unexpectedly shuffle off their mortal coil. However, while stay-at-home parents do not have income that needs replacing, life insurance could provide the money to replace all the jobs that the stay-at-home covers. Thus begins the paradox of how much I need, which leads to how much can I afford?
Answering the first question of how much depends on numerous factors:
1. The number of kids.
2. The age of the kids.
3. Who cares for yard maintenance?
4. Who cleans the house
5. Insert anything else I am missing for your household; this is about you.
You could find and hire a fee-only planner through the National Association of Personal Financial Advisors or a planner who charges by the hour through the Garrett Planning Network. Alternatively, you could schedule an appointment with one of Rebecca Rice and Associates agents for FREE! FREE? That is an oversimplification; it will cost you your most precious resource, your time. However, we will also give you our most prized possession, our time. But we do not charge or bill you to set up your financial plan. We’ll ask you to do some homework by completing a detailed financial questionnaire and a cash flow analysis. Using the numbers, you provided, we customize a plan based on your unique needs and show you how to fund your plan with money already in your budget.
Our second question of how much you can afford? To answer that question, we’ll use the personal financial questionnaire to calculate a premium that is not only reasonable but affordable. A well-known financial advisor would advise you to buy a term policy and invest the rest; indeed, he’s been selling that garbage to the masses for decades, but that is a waste of money. If you’re reading this article, you’re like me, “you’re too poor to buy cheap,” which translates to I need to buy the best product I can afford because I cannot afford to do this twice.
By far, the best investment for your hard-earned dollars is cash-value building whole life insurance because you’re not leasing your buying; you become a member of an elite group; as American Express was fond of advertising, “membership has its privileges.” Cash-value whole life insurance is the only place that allows you to invest your money, compound your money, and collateralize your money to use the benefits now.
Written By Jonathan Sorrick, M.A. Math 559-904-7948