Are you a stay at home parent? That’s why Dave Ramsey said you need life insurance

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Key points

• Many people buy life insurance to replace their income.
• Stay-at-home parents have no income in the traditional sense.
• Dave Ramsey said they still need life insurance because their services have value.

Traditionally, when people buy life insurance, a large part of the reason is because loved ones rely on their income. In fact, it’s common for people who get covered to be told they should buy a policy with a death benefit of 10 or 12 times their earnings.

Stay-at-home parents don’t have wages going into theirs Bank account, so they may not think they need coverage. Finance expert Dave Ramsey said this is short-sighted and a big financial mistake. Ramsey believes stay-at-home parents have needs life insurance coverage because the services they provide are of enormous value.

“A life insurance policy for a stay-at-home parent doesn’t replace their income. It provides the money needed to cover all the work the SAHP did before they died,” Ramsey said. She advised buying between $250,000 and $400,000 in coverage to make sure there are funds available to provide these services.

But is Ramsey right?

Do stay at home parents really need life insurance?

When it comes to whether or not stay-at-home parents really need life insurance, the answer is an unequivocal yes.

I am not a stay at home parent, but I am a home working parent with a flexible schedule, so I do many of the activities a parent would at home. This includes things like watching my kids during the day, cooking, grocery shopping, taking my kids to school, trying to keep my house from turning into a mess, taking my kids to activities, and an almost endless list of other mundane tasks.

During most weeks, I end up spending way more time for childcare activities than I spend on actual paid work. And, if I wasn’t here to do all of these things, it would be a huge burden on my husband (who has an outside job with no flexibility). He would end up having to drastically reduce his work schedule (and income) or hire someone to handle everything I do, or both. And hiring someone to run the house full time would cost a fortune.

In fact, Salary.com polled 19,000 mothers, determined all the jobs they hold, and estimated the market value of all that work. This research revealed that, in 2021/2022, the median salary for stay-at-home moms would be $184,820. And of course, this would also be the same for stay-at-home dads, of which there are increasing numbers.

The reality is that the services provided by a stay-at-home parent should definitely be replaced in the event of their death, and life insurance would probably be needed to provide the funds to do so.

Don’t leave your loved ones in the lurch

Any family that has a stay-at-home parent should make sure they heed Ramsey’s advice and get the right coverage as soon as possible. No one knows when the disaster will strike, and if a parent dies, not only will funds be needed to pay someone to play their role, but additional money may also be needed to help children in therapy deal with the effects of the loss. of a caregiver.

Life insurance it’s a very convenient way to make sure the money is there to help loved ones who survived this difficult time. So, buy a policy ASAP to make sure everyone can still be looked after if the worst happens.

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