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Why women need life insurance

Life insurance is just as important for women as it is for men.

You probably know that women generally lag behind men when it comes to pay and retirement, but there is another important financial gap that you may not have thought about – life insurance. According to LIMRA,1 only 47% of women have life insurance coverage versus 58% of men. Why the gap?

Perhaps you have decided that you just don’t need life insurance. But have you considered the financial impact that your passing would have on your family and friends? If you currently don’t own life insurance, you should consider the following scenarios.

Working mothers

Working mothers’ income can have a significant impact on their family’s lifestyle. If you are a working mom, your earnings help cover the cost of living expenses such as food, clothing and utilities, plus future needs such as college savings and retirement funds. This makes life insurance just as important for women and it can help protect your family by replacing your lost income.

Single women

Like single men, many single women think life insurance is unnecessary because they have no dependents. What you may fail to realize is that life insurance can pay off debts and funeral expenses that may otherwise fall on the shoulders of friends or family members.

Single mothers

If you’re a single mother, you very likely bear the primary responsibility for your children’s financial support. If you pass away, life insurance can provide ongoing income to cover child care costs, medical expenses, debts and future college tuition.

Stay-at-home mothers

It is estimated that the annual “salary” of a stay-at-home mom in 2021 is more than $184,000.2 You also need life insurance, not just your partner who works outside the home. If you are a stay-at-home mom, your surviving spouse may have to pay for services such as child care, transportation for the children, housekeeping and more. If the surviving spouse takes over these added responsibilities on their own, this could lead to reduced work hours, which in turn could result in loss of income. Proceeds from a stay-at-home mother’s life insurance can help a surviving spouse pay for services that keep the household running and allow them to continue working.

The good news

There is one important area where women do better than men – life expectancy. On average, life expectancy for women is five years longer than that for men.3 As a result, life insurance premiums are actually less for women than they are for men. For example, a healthy 35-year-old woman who doesn’t smoke would pay an average of $25.23 per month for a 20-year term life insurance policy with a $500,000 death benefit. The same policy for a healthy nonsmoking man of the same age would cost $30.03 a month.1

The bottom line

Life insurance is just as important for women as it is for men. Putting a plan in place now will not only help give peace of mind, but it can also help put your loved ones in a better position to meet their future needs.

Many employers offer life insurance coverage for employees and their spouses. But keep in mind that those policies will typically not remain in force if employment is terminated. And church groups, alumni associations and other social organizations may offer affordable group coverage that often may not require a medical exam. You can also find private term life insurance quotes online. Regardless, you should discuss your specific life insurance needs with an independent financial planner who is a fiduciary – one who puts your best interests first.

Neither Financial Engines Advisors, L.L.C. nor any of its advisors sell insurance products. Edelman Financial Engines affiliates may receive insurance related compensation for the referral of insurance opportunities to third parties if individuals elect to purchase insurance through those third parties. You are encouraged to review this information with your insurance agent or broker to determine the best options for your particular circumstances.

1 Huddleston, C., & Danise, A. (2021, March 29). 10 Things Women Need to Know About Life Insurance. Forbes. Retrieved June 7, 2021, from https://www.forbes.com/advisor/life-insurance/what-women-should-know/
2 Murphy, J., & Crogan, M. (2021, May 6). Mom’s Salary Value Reaches $184K as Pandemic Workload Skyrockets According to a Salary.com Survey of 19,000 Mothers. PR Newswire. Retrieved July 7, 2021, from https://www.prnewswire.com/news-releases/moms-salary-value-reaches-184k-as-pandemic-workload-skyrockets-according-to-a-salarycom-survey-of-19-000-mothers-301285712.html
3 Arias, E., Tejada-Vera, B., & Ahmad, F. (2021, February). Provisional Life Expectancy Estimates for January through June, 2020. Centers for Disease Control and Prevention. Retrieved June 1, 2021, from https://www.cdc.gov/nchs/data/vsrr/VSRR10-508.pdf

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