A Day’s Work: The Financial Value of a Stay-at-Home Parent
A family breadwinner needs a life insurance policy, but what if you’re a bread maker? It’s important to consider how your family would manage if something happened to you.
The pandemic has changed the dynamics of family and work as the various hats we once wore have shifted and, in many cases, multiplied. Many of us now juggle working from home, homeschooling children, and caring for elderly parents. These changes have brought to light the subject of life insurance.
When determining how much life insurance they need, many families subscribe to the common misconception that if the primary breadwinner has life insurance, the family is protected. They focus solely on income and often fail to consider significant costs that would be incurred if one contributor were no longer there to wear many hats.
The Life Insurance Gender Gap
Statistically—even now—women still comprise the majority of part-time or full-time homemakers and caregivers. Women are also far less likely to identify as the primary breadwinner, buy less life insurance than men do, and have less coverage even when they do own a policy.
According to a 2019 study, 67% of women surveyed had life insurance compared to 79% of men. Of those who had a policy, women had an average coverage amount of $231,342 compared to $432,102 for men.1 The pandemic has exacerbated this traditional gender gap in life insurance.
Salary.com annually calculates the value of all the work a stay-at-home parent provides and equates it to an annual income. The annual salary of a stay-at-home parent in 2019 was $178,201.2 This would be a wide gap to bridge, even for high income earners, should something happen to the person responsible for these varied contributions.
The health and economic uncertainty brought on by the pandemic has many of us confronting a very new reality and re-examining the importance of a safety net for our families. As we take this time to review our financial plans, we need to attach a very real dollar value to contributions of everyone, not just the breadwinners. Our online calculator provides guidance, and is a great place to start.
1“The Gender, Roles and Life Insurance Survey,” Haven Life, 2019.
2“Annual Salary of a Mother,” Salary.com, 2019.