A stay at home parent is one of the toughest ‘jobs’ out there. It can be both physically and psychologically taxing, yet extremely enjoyable, on the parent. It has been estimated that it was looked at from a perspective of a ‘job,’ the parent(s) would be making approximately USD 115,000 a year. That is on par with the average salary of an executive, which shouldn’t be a surprise because you are (sometimes) in charge.
Despite being a stay at home parent is one of the toughest jobs, some parents don’t view it as such, which can mainly leave them vulnerable to missing out on coverage employers may have otherwise provided.
So, we have established the financial value of a stay of home parent and the difficult position they have. Life insurance experts recommend for individuals to cover anywhere between 5-10 times their annual income.
Well, it’s simple. The outcome will be the same, but the process will be different. For example, most applications will ask for the annual salary, and although you can’t quite pencil in ‘toddler hunter,’ there is a different route to used to calculate coverage.
One of the most critical factors to be considered will be your health history and your lifestyle, to determine if you indulge in any risky activities.
Let’s explore the next step of determining eligibility in two different scenarios:
Scenario 1: Spouse of stay at home parent currently has life insurance coverage
Other areas of consideration to help calculate life insurance eligibility and premiums, would involve determining the coverage amount of the wage-earning partner. Once this is established, the stay at home partner would be eligible for the same amount, or less, of their partner’s coverage.
Scenario 2: Spouse of stay at home parent does not have life insurance coverage
In this scenario, the next steps used to determine coverage and terms for a stay at home parent would be to understand the motivation behind gaining the coverage. Motivation can range anywhere from wanting to protect loved ones, to have intentions of going into the workforce or finishing school.
Looking after the best interest of your family can be one of the most significant motivations behind gaining life insurance for stay at home parents. If your scenario closely matches that of scenario two above, then you will want to ensure you keep a lookout for our next blog, which solely focuses on the process, figures and the steps to expect when applying for life insurance.
If you have direct questions to ask now or would like a free consultation, you can reach out to us at our Edmonton, Calgary or Lac La Biche Office by calling 1-877-415-2810 or email firstname.lastname@example.org.