Insurance for Mom in the old-style nuclear family has often been the after-thought. Dad, the traditional primary breadwinner is typically the one who is insured up to the hilt. But who doesn’t know of a relatively young couple with children that faces the cancer diagnosis of Mom and the horrible havoc that can wreak on life and finances?
Here’s just such a sad story and the financial results. In the days when life seemed limitless, Margaret used to joke that there was “just enough insurance on me to bury me.” She and her husband Patrick had taken out a big policy on him right after Tessa, their first child, was born, but Margaret’s small policy was pretty much an afterthought.
As a free-lance copywriter who worked from home, Margaret divided her time between taking care of their three children and writing brochures to supplement the family’s income.
When she was diagnosed with pancreatic cancer and died in a matter of months, Patrick was stunned emotionally and financially. Unfortunately, Margaret’s modest life insurance policy just covered her final expenses ― and very little else.
They had not factored in the impact of even her relatively small stream of income and the actual value of the considerable hours of child care and home management. Patrick was left with the task of covering these roles or hiring help and childcare at equally considerable expense.
As he set his sights on providing the best possible future for his children and himself, Patrick revisited the role of life insurance in his family’s financial plan to make sure his own coverage was truly sufficient, and encouraged other loved ones to rethink their protection.
Let’s look at the real numbers. Between 1960 and 2011, the cost of raising a child grew by $40,000, or 23% in 2011 dollars, to $234,900. Costs rise each year through inflation as well as an increased percentage of overall costs. It important to keep up with these changes with a regular review of your family’s insurance coverage, especially life insurance for Mom!
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The Atlantic, June 2012.