Life Insurance When You’re Expecting a Child

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By now you know why you need life insurance for various stages in your life, right? There are good reasons to have it when you are young and single, or even if you are married and don’t have any kids yet. But when you decide to have kids, that’s a game changer. Whether you just found out you are having a baby or you’ve decided to adopt, you need life insurance.

Why?
If you pass away when you are married and don’t have kids yet, your spouse can probably get a job or continue working to support themselves. However, trying to juggle daycare, a mortgage and other expenses on one salary instead of the two can create a financial hardship for your family. In addition, you might have planned to save for your kids’ education when you had two incomes, but when one parent is left to financially juggle it all, the kids’ education fund might be sacrificed just so your family can survive. It’s so important for you to have life insurance when you become a parent that most adoption agencies require parents who want to adopt to carry a sufficient amount.

Who?
If one of you plans to stay at home when you have kids, it’s still important for both of you to have life insurance. If the stay-at-home parent dies, the working parent may need to hire daycare for the kids, and possibly a housekeeper or someone who can take care of yard and home maintenance. Life insurance can provide the means to do that.

It’s also a good idea to get a policy for each of your children. A policy like our Junior Special or our 20-Pay Whole Life plan can help lock in low rates, and if you purchase a guaranteed insurability rider, it will help ensure continued coverage into adulthood as long as conditions are met.

When?
The younger you are when you purchase life insurance, the cheaper the premiums tend to be. According to Investopedia, premium amounts can increase, on average, about 8% to 10% for every year of age. Premiums may go up some as you increase your coverage amount, but they are still likely more affordable when you are young. So when is the best time to get life insurance? The sooner the better.

How Much?
That depends on a lot of things. Some just want enough to pay off the mortgage. Others want that and enough to pay outstanding debt, ongoing expenses, contribute to a spouse’s retirement and contribute to education funds for their children. A smart way to do it is to calculate it based on the amount your family would need to live on if you died today. Include the mortgage, utilities, transportation expenses, diapers, formula, food, etc. Another way to estimate your needs is to use our life insurance calculator. This tool gives you a high-level overview of what your family will need.

What Kind?
There are a wide variety of types of life insurance, from term life to permanent, so there’s something for most budgets. The optional guaranteed insurability rider that can be purchased with the policy helps ensure you are still insurable as long as certain conditions are met, even if you develop a health condition which would make it difficult to find coverage otherwise. A Shelter agent can help you find the plan that best suits your needs and your budget.

If you have already purchased life insurance, you may just need to increase the amount. Similar to the reasons you would increase your life insurance when you get married or buy a house, now you have little ones depending on you to provide for them financially until they can do it on their own.

You buy life insurance to take care of the ones you love when you aren’t here to do that anymore. Any amount you buy will likely help pay for your final expenses, help pay the mortgage or outstanding debt and more, so your family won’t have to worry about finances while grieving your loss.