Protecting the Stay-at-Home Spouse

When married couples have young children, often one spouse stays home while the other works outside the home. While most parents understand the necessity of purchasing a life insurance policy on the income earner, few realize the importance of also insuring the stay-at-home spouse.

Being Prepared for the Unexpected

What if the stay-at-home spouse suddenly became ill, disabled or died? The family would be devastated. Friends and family members would initially pitch in to help. But, eventually they would return to their regular lives. Before the surviving spouse returned to work, a caretaker for the children and home would need to be hired, presenting a potential financial hardship. But, had life insurance been purchased on the stay-at-home parent, the family's needs would have been protected.

Measuring the Value of the Stay-at-Home Spouse

Despite the importance of the stay-at-home parent, there's little research to quantify its value. In its May 8, 2008, Mom Salary Survey, Salary.com reported the ten most popular functions performed by mothers equates to $116,805 per year vs. a working mother's salary of $68,405. It further states the stay-at-home spouse works a 94-hour week, serving as housekeeper, teacher, cook, psychologist, and van driver — in short, functioning as a CEO at home.

Flexible, Customizable Choices

The type of policy you select depends on your needs and budget. Term life insurance provides affordable coverage for several years. In contrast permanent life insurance provides protection for your entire life (provided premiums are paid) and accumulates cash value tax-deferred. This cash value can be accessed (unpaid loans accrue interest and reduce policy's cash value and death benefit). Plus, riders, available with term and permanent life insurance, enable you to customize your policy to meet and grow with your changing needs.

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.

This educational third-party article is being provided as a courtesy by New York Life Insurance Company. For more information on this topic, contact me.

SMRU: 00335717CV (exp 12/31/10)