Life insurance is vital for families, including families where both partners earn an income. Initially, you may think you can rely on the surviving partner’s income, so you don’t need life insurance, but that may not be the best way to look at the issue. This is because, if yours is a dual-income household, your family is likely used to living with two incomes, and therefore, losing one income can rock your family’s financial stability. Read on to learn more about life insurance for dual-income families and why do we need it.
Should Dual-Income Families Have Life Insurance?
For a dual-income household, a life insurance policy can help cover the funeral expenses and the financial gap caused by losing one source of income. This will allow the surviving partner to grieve and focus on the well-being of your family without financial pressures. However, not having sufficient life insurance coverage isn’t just a temporary inconvenience – it can be an overwhelming financial and emotional blow to your loved ones. The facts surrounding the death of a parent and the aftermath for families paint a grim picture, revealing that many people are devastated psychologically and financially due to an insufficient financial safety net. For instance, 70% of U.S. families experience financial hardships within three months of losing the breadwinner.
Why Do We Still Need Life Insurance If We Both Have High Income?
If both you and your partner have a high income, life insurance may seem unnecessary. However, a life insurance policy is essential for dual-income families for the following reasons:
- Financial stability – Carrying life insurance means that if your pass on, you won’t leave your financial obligations, as well as your shared mortgage, and bills to your surviving partner.
- Quality of life – Your partner may still have their income, but they will have to make certain sacrifices to maintain the family’s quality of life. On top of the psychological and financial stress wrought by your demise, your partner may have to work more hours and sacrifice their well-being to care for home maintenance and childcare expenses. Life insurance can ensure that your family maintains their quality of life.
- Legacy and estate – Your life insurance policy are one of the first financial contingency plans that will pay out to your dependants. So talk to your attorney and financial planner to learn how to craft a policy that will provide sufficient financial protection to your family.
How Much Coverage Do You Need?
The rule of thumb is each partner should carry a life insurance policy that amounts to at least 10 times their annual income. In addition, each of you should also consider adding up to 20% of that annual income to your coverage for expenses that you may leave behind and any shared financial obligations. These may include childcare, education, utilities, bills, car payment, rent, and mortgages.
Therefore, even if you and your spouse work full-time, you should prioritize getting life insurance. Life insurance will help you maintain your quality of life should the worst happen, and it will provide you with financial flexibility in the aftermath of one of you passing away. Life insurance can also enable you to accumulate wealth while both of you are alive by serving as a savings account. Finally, it can also allow you to pass on financial resources to your loved ones.
How to Get Life Insurance with Premier Protection
At Premier Protection, we provide a wide range of life insurance options that include guaranteed issue policies, fixed-rate policies, spousal coverage, term policies, universal life policies, free terminal/chronic/ critical illness riders, and more. For a life insurance policy that suits your budget and needs, contact us today.
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