“I have yet to meet a father who didn’t see little feet emerging and immediately feel the need to run out and throw himself at an insurance salesman.” — Garth Turner
Wayfare and I just had a very short discussion about our life insurance needs. I off-handedly remarked some time ago that one of the factors that maybe should go into the typical rent-vs-buy analysis is the reduced need for life insurance as a renter, but since I didn’t know what the cost was, it was hard to model (and I assumed, trivial).
Anyway, with a new spud under cultivation, I thought it was worth discussing seriously, and we very quickly agreed that we didn’t: she makes more than I do (though as of next week, “0″ is an easy bar to hurdle), but both of us are capable of supporting a single-parent family on our own. If we both die, both our sets parents are well-off enough to take in a grandchild and not become destitute themselves (at least with our savings to help out).
As renters, we don’t have a mortgage to discharge or huge transaction costs for moving, so it would be reasonably easy (at least financially) for the survivor to move to a smaller, cheaper place. And the aforementioned savings would help with any burial expenses, additional childcare costs, or bereavement leave.
A few online calculators confirmed that our life insurance needs were basically zero (varying between a $150k policy and negative $80k depending on the calculator and assumptions used). I went ahead and got a few quotes for a $100k term-10 policy, and it’s not terribly expensive, but not trivial either: about $150/year for someone my age. This might all change once I see little feet with their widdle toes, but for now, hey, we don’t seem to need it.