Insurance Agent, N. Holobaugh Insurance, United States
Most insurance companies will perform whats called a "needs analysis" to gauge how much your family and or surviving children would need in the event of your death. A good place to start is to add up your total outstanding financial obligations, whether it be a car loan, or credit card debt. Then, look at how much you make per year multiplied by the amount of years until your youngest child for example turns 18. Factor in college tuition and living expenses.
This is only a recommendation, an official needs analysis would need to be done to determine the exact amount needed for survivors.
Agent Owner, Gilmore Insurance Services, Marysville, Washington State
It's going to depend on what you want to protect with that coverage. Factors such as age of the kids, overall debt to the family and new costs that come with having somebody do the things the stay at home does. While there are many formulas I have always started with the concept of what puts the family at zero debt if somebody dies. Then I add for new costs and services with this situation like childcare. Again with any "how much" question, there is no one answer, just yours.
Owner, Wright Insurance Agency, Great Pittsburgh Area
There is not a simple answer to this because it will depend on many factors including what the household income is, what the life insurance is intended to cover, etc. Generally speaking, the average client will need somewhere between 300 to 500K in life insurance just to be properly insured, but it varies greatly between individuals. The best thing to do is contact a local independent agent and have them look over your situation to come up with a plan that best suits your needs. A good independent agent will be able to get you the correct coverage at a reasonable price as they work with many companies and not just one which is always the best way to go.
President, Lane Independent Agency, Southern California
Do you have children? Do you have a mortgage? Do you have any income? Are you planning on insuring yourself, while a spouse works and insures himself? Do the kids need to pay for college? These are all factors. If you are married, then what would it take to replace your services to your husband and kids, meaning for child care, cleaning, food preparation, and the things a spouse might have to otherwise pay for? Typically the amount for such a situation is in the area of $300K. Thank you. GARY LANE.
Co-Founder, TermInsuranceBrokers.com, Goldenzweig Financial Group, Las Vegas, Nevada
Most carriers will only issue a policy for a face amount equal to or less than the amount of coverage you have on your spouse. So you've got to think about how much coverage your spouse has, what debts you need/want paid off, do you need it for income replacement,. etc.
Many people think that if their spouse does not produce an income, then they do not need coverage. This is the wrong way to look at it. Just because a spouse may be a stay-at-home mom or dad, doesn't mean they don't need coverage. In many homes, a stay-at-home spouse often maintains the house, the yard, buys the groceries, cooks, etc. If the spouse passed away, would you do these tasks? Or would you pay to have someone else do them? Are you going to do them yourself? All of these factor into the decisions.
In short, while a stay-at-home spouse may not generate income, he/she may greatly reduce personal expenses. How much does that total up to over a given number of years?
It's helpful to consult with an experienced broker who can help you determine how much coverage is suitable to your needs and budget. Please feel free to contact me for help or if you have any other questions. Thanks very much.
President, The Firm of Steven H. Kobrin, LUTCF, 6-05 Saddle River Rd #103, Fair Lawn, NJ 07410
This is a very relevant question because there is not a black-and-white answer to it.
Let’s suppose you have a family where mom does stay at home with the kids. Tragically, she dies. What is the best possible thing that can happen with these kids? Really, it’s for dad to stay home with them.
They’ve already lost mom. They are going to need their dad more than they ever have. He is THE parent.
Dad may want to keep working and hire a Mary Poppins-type nanny, but that is the second best solution by far. He really should stay home from work to the greatest extent possible and just connect and bond and nurture and comfort these kids through what may be the most devastating occurrence in their life.
Obviously, he will need money to be able to afford to stay home. That is what I think is the number one function of life insurance on a stay-at-home mom.
This is a hard sell to insurance companies these days, because they keep thinking in terms of percentage of the wager earners’ coverage, and on and on.
But if I get a couple who really want dad to stay home if the family does lose mom, I fight hard to get them a policy to make that happen.
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This is only a recommendation, an official needs analysis would need to be done to determine the exact amount needed for survivors.
Many people think that if their spouse does not produce an income, then they do not need coverage. This is the wrong way to look at it. Just because a spouse may be a stay-at-home mom or dad, doesn't mean they don't need coverage. In many homes, a stay-at-home spouse often maintains the house, the yard, buys the groceries, cooks, etc. If the spouse passed away, would you do these tasks? Or would you pay to have someone else do them? Are you going to do them yourself? All of these factor into the decisions.
In short, while a stay-at-home spouse may not generate income, he/she may greatly reduce personal expenses. How much does that total up to over a given number of years?
It's helpful to consult with an experienced broker who can help you determine how much coverage is suitable to your needs and budget. Please feel free to contact me for help or if you have any other questions. Thanks very much.
Let’s suppose you have a family where mom does stay at home with the kids. Tragically, she dies. What is the best possible thing that can happen with these kids? Really, it’s for dad to stay home with them.
They’ve already lost mom. They are going to need their dad more than they ever have. He is THE parent.
Dad may want to keep working and hire a Mary Poppins-type nanny, but that is the second best solution by far. He really should stay home from work to the greatest extent possible and just connect and bond and nurture and comfort these kids through what may be the most devastating occurrence in their life.
Obviously, he will need money to be able to afford to stay home. That is what I think is the number one function of life insurance on a stay-at-home mom.
This is a hard sell to insurance companies these days, because they keep thinking in terms of percentage of the wager earners’ coverage, and on and on.
But if I get a couple who really want dad to stay home if the family does lose mom, I fight hard to get them a policy to make that happen.