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How much life insurance should each parent have for themselves?

Right now dh and I both have life insurance policies (our kids also). I don't work and dh's policy is higher than mine. But, I am curious as to how much typically should parents of 2 kids carry?

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josie_mommyof2

Asked by josie_mommyof2 at 8:45 PM on Apr. 13, 2009 in Money & Work

Level 10 (411 Credits)
Answers (7)
  • We have one on my hubby threw the Army for 400,000 and I do not have one and neither does our daughter. We will be getting one to match his tho.
    brailynsmama08

    Answer by brailynsmama08 at 8:56 PM on Apr. 13, 2009

  • If you are a SAHM they say you should have enough coverage to cover what you would do for a year or two, so: daycare, cooking, cleaning, accounting, and all the other stuff you do on a daily basis b/c these are the things he would either have to do himself or pay someone else to do. My DH has one through the military as well, then mine is for $350k, our daughters is only 3 so we didn't feel it necessary to get her life insurance in a ridiculus amount. Hers is $150k which we were told should cover expenses for funeral and anything else that comes up.
    vabchmommy

    Answer by vabchmommy at 8:58 PM on Apr. 13, 2009

  • My husband's is 500K and we're pushing mine up to about 350K, as right now it's only 50.
    Anonymous

    Answer by Anonymous at 9:36 PM on Apr. 13, 2009

  • We each have a total of $1M in whole and term. It's a universal policy that converts the term into whole life insurance over time. The benefit of term is the cost-- usually pretty cheap. The benefit fo whole is the investment value, and it never expires as long as you pay the premium. If you get a policy where the company pays dividends, over time, you may not have to pay the policy premium at all, and you would still be covered.

    We came at this number because we intend to have 4 children, we want to pay for their college educations, and our efforts to do so would be severely hampered should one of us die. We also wanted to leave the surviving spouse with as little debt as possible, including the mortgage.

    The number you reach should be at a minimum, 5x your gross salary, because don't forget the tax implications!!!
    Busimommi

    Answer by Busimommi at 10:14 PM on Apr. 13, 2009

  • Enough that you can maintain your current lifestyle with out diminishing the principle of the life insurance. Wow... let me break it down for you. If your family currently makes $50,000 a year, I would recommend buying $1,000,000 worth of life insurance so that if you invest it in a relatively safe place (say a CD for example) that earns about 5% interest, you could continue to draw out $50,000 a year indefinitely. Even though you are a stay at home mom you still need someone to watch your kids and that costs a lot of money.

    Go with Term life insurance. The purpose of insurance is to cover your family if you die before death is expected. If you are in your 60's you should already have enough money for retirement. Plus term life is cheaper than buying whole life so you can invest the difference using an actually investment agency rather than an insurance company. KWIM? Let me know if you have more questions.
    Erica_Smerica

    Answer by Erica_Smerica at 11:11 PM on Apr. 13, 2009

  • 2.75 million on my husband. 350k on me. My husband wanted to make sure I could still stay home with our son. Our home is paid for and we own other income properties so I could live off the interest of that amount and be fine.

    Anonymous

    Answer by Anonymous at 1:29 AM on Apr. 14, 2009

  • At least 1.5 TIMES your annual income. I have about $100k on me.
    paralegal09

    Answer by paralegal09 at 7:44 AM on Apr. 14, 2009

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