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We live in a world where families with young children often have both parents in full time employment.

A decision is sometimes made for one parent stay at home and be a full time homemaker. This person may be the husband or wife.

Life insurance is usually taken out to protect a family against the financial effects of the death of a breadwinner. The idea that a homemaker needs life insurance may not seem as important, however when one considers what may be lost in the event of their death, the value of life insurance and the amount of cover needed becomes more apparent.

There may not be a need to replace lost income, but the loss of the homemaker will create a number of financial needs that did not exist previously.

The most basic need for life insurance centres on costs that would be typical to all in the event of our deaths, funeral costs. The likely minimum cost will be in the region of £9,000.

Beyond funeral costs, there could be medical bills as a result of a series of treatments prior to death, as well as a host of other expenses incurred as a result. These could include additional childcare expenses, travel expenses or even unpaid bills as a result of the pressure of dealing with the last days of a loved one’s life.

Homemaker do not earn wages in the same way as the primary breadwinner, however she or he provides dozens of domestic services that could cost substantial amounts, if they had to be paid to an outsider. Legal & General’s most recent “value of a parent” survey valued the unpaid child-care and domestic tasks undertaken at approximately £21,600 for men and £29,500 for women.

If you have very young children, there will need to be some form of childcare – probably in the home. There might also be a need for home cleaning services and payment for various other functions that the homemaker will no longer be around to provide. The combination of such expenses can cost thousands of pounds per month.

Ward Williams Financial Services Ltd would be delighted to assist with any financial planning enquiry that this article may have prompted.


About the author

Sam joined WWFS in December 2017 as a Paraplanner. During his career, he has worked for a number of Financial Services companies, which includes working as an adviser. He is currently studying to achieve Chartered Financial Planner status.  In his spare time, he enjoys spending time with his growing family as well as running and cycling.