The loss of a spouse, particularly the major wage earner, can have a devastating impact on a family's immediate cash-flow needs as well as its individual members' financial goals. Whether you need disability income insurance, life insurance, or any insurance at all, depends on your personal financial situation. Members of the Financial Planning Association of Greater Indiana may be able to help advise you.A disability or death has a direct impact on the surviving family's current lifestyle and on the lifestyle that was assumed for retirement. The 401(k) balance, pension benefit and Social Security benefit will all be much less than if the primary wage earner had lived through his or her working years.
The details will be different for each family, depending on whether the spouse worked outside the home, if there were children, or other factors.
But generally the loss of either spouse is going to have an economic impact on the family. A stay-at-home mom does not have any income that would need to be replaced, but the surviving spouse would need to pay someone to help care for the children.
Unfortunately, too, many people don't realize the importance of life insurance until it's too late.
However, imagine yourself or your spouse gone tomorrow. How would you answer these questions:
- What would the immediate impact on your family be?
- Are they counting on your paycheck in the future to cover basic needs and future savings goals?
- Could they afford the funeral costs?
- Who would pay the home mortgage?
- Who would raise the kids?
- And what about saving for retirement and college costs?
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