Should new parents get life insurance?

When Jessica found out she was pregnant with her first child, she and her husband Mark immediately began preparing. They painted the nursery, assembled the crib, researched car seats, and read every parenting book they could find. But one critical preparation never made their list: life insurance.

Three months after their daughter Sofia was born, Mark's colleague shared a heartbreaking story about a friend who died unexpectedly, leaving his young family without financial protection. The widow had to move in with her parents because she couldn't afford childcare and housing on her income alone.

That conversation jolted Mark and Jessica into action. "We were so focused on onesies and diapers," Jessica recalled, "that we hadn't thought about the biggest risk we faced: what would happen to Sofia if something happened to one of us?"

If you're expecting a baby or recently became a parent, life insurance isn't just important—it's essential. Here's why, and how to ensure your growing family is protected.

Why Parenthood Changes Everything

Before having children, you might have been able to make the case that life insurance was optional. If you were single with no dependents, or even if you were married but both working with manageable shared expenses, the financial impact of losing one income might have been difficult but survivable.

Parenthood changes this calculus completely. The moment you become responsible for another human being who is entirely dependent on you, life insurance transitions from "something I should probably get around to" to "something I need right now."

Consider what happens to a child when a parent dies without life insurance:

Immediate financial crisis: Between lost income, funeral costs, and sudden childcare needs, families can face immediate financial devastation. When David's wife Alicia died shortly after their son was born, he faced $18,000 in funeral and medical bills while simultaneously needing to hire full-time childcare so he could continue working.

Long-term financial insecurity: Beyond immediate expenses, children need support for 18+ years—food, clothing, housing, education, healthcare, and countless other costs. The surviving parent must somehow provide all of this on one income, often while grieving and managing increased childcare needs alone.

Lost opportunities: Without adequate financial resources, children may lose access to opportunities their parents had envisioned—private school, college education, extracurriculars, or even stable housing in a good school district.

Compounded trauma: Children who lose a parent face emotional trauma that will affect them for life. Financial stress and instability compound this trauma, potentially leading to additional moves, school changes, or other disruptions during an already impossibly difficult time.

Nicole saw this firsthand when her brother died unexpectedly, leaving behind a 3-year-old and 5-year-old. "My sister-in-law is amazing and doing her best," Nicole explained, "but watching her struggle to make ends meet while grieving and single-parenting two young kids is heartbreaking. My brother never got around to buying life insurance, and now his children are paying the price."

Life insurance doesn't prevent the emotional pain of losing a parent, but it does prevent financial devastation from amplifying that trauma.

The True Cost of Raising Children

To understand how much life insurance parents need, it helps to understand the actual financial commitment of raising children. According to recent USDA estimates, middle-income families will spend approximately $310,000 to raise a child from birth through age 17—and that doesn't include college.

Break that down annually, and you're looking at roughly $18,200 per year per child. For two children, that's $36,400 annually. Over 18 years, you'll invest approximately $655,000 for two children to age 18.

But those figures are just baseline costs. They don't account for:

College education: Four years at a public university currently averages $100,000+ per child. Private universities can cost $250,000+ per child. Even if your children receive scholarships or financial aid, having funds designated for education provides opportunities and reduces debt burden.

Childcare: For young children, childcare often represents a second mortgage—$1,200-$2,500 monthly per child depending on your location. When Amanda returned to work after maternity leave, she was shocked to discover that full-time infant care cost $2,100 per month—nearly 30% of her salary.

Extracurricular activities: Music lessons, sports, arts programs, summer camps, and other enrichment activities add $200-$500+ monthly per child depending on interests and availability.

Healthcare: Even with insurance, children incur medical expenses—copays, prescriptions, dental care, orthodontics, and unexpected illnesses or injuries.

When Roberto and Maria calculated the full 18-year cost of raising their two children, including college contributions, the number approached $1.2 million. "That was the moment we realized our life insurance needs weren't just about replacing income for a few years," Roberto said. "We needed enough coverage to actually see our kids through to independence."

Understanding how much life insurance you need to replace your income provides a framework for these calculations.

Both Parents Need Coverage—Even Stay-at-Home Parents

One of the most common mistakes couples make is only insuring the working parent. The logic seems sound: "We only need to replace income, so we only need to insure the earner."

This logic is dangerously flawed.

Stay-at-home parents provide enormous economic value through unpaid labor—childcare, household management, cooking, cleaning, scheduling, and countless other tasks. If a stay-at-home parent dies, the surviving parent must either drastically reduce their work hours or pay for full-time help.

When Stephanie, a stay-at-home mother of three, passed away unexpectedly, her husband Brian faced an impossible situation. He earned $95,000 annually in a demanding career that required 50-60 hour weeks. Without Stephanie, he needed to hire full-time childcare for his 2-year-old and after-school care for his 7-year-old and 9-year-old.

The cost: $3,400 per month for the childcare he needed, plus additional help with housekeeping, meal prep, and logistics. That's $40,800 annually—and it didn't come close to replacing everything Stephanie had done.

"I never realized how much economic value Stephanie's work represented until she was gone," Brian reflected. "If we'd had life insurance on her, I could have worked less and spent more time with the kids during that first terrible year. Instead, I was working full-time while paying a fortune for childcare and barely keeping our heads above water."

Financial advisors typically recommend $300,000-$500,000 of coverage for stay-at-home parents—enough to cover childcare, household help, and other expenses that would need to be outsourced. For parents of young children or multiple children, coverage toward the higher end of that range (or even more) is often appropriate.

The Timing Question: How Soon Is Soon Enough?

The best time to purchase life insurance is before you need it—ideally before you're even pregnant. Here's why:

Pre-pregnancy health complications: Pregnancy can trigger health conditions like gestational diabetes, preeclampsia, or high blood pressure. While these are often temporary, they can affect your life insurance underwriting and premiums if they occur before you apply.

Better rates when younger: Every year you wait, premiums increase. A 27-year-old will pay significantly less than a 32-year-old for the same coverage.

Guaranteed coverage before the unexpected: None of us know what health changes might occur. Purchasing coverage while you're healthy ensures you lock in the best rates for decades.

Sophie and Alex purchased life insurance two years before trying to conceive. "Everyone thought we were being overly cautious," Sophie explained. "But when I developed pregnancy complications that required bed rest and ultimately an early delivery, I was grateful we already had coverage locked in. If we'd waited, those pregnancy complications would have been on my medical record during underwriting."

That said, if you're already pregnant or already have children without life insurance, don't let perfect be the enemy of good. The second-best time to purchase coverage is right now. Every day without protection is a day your family is vulnerable.

How Much Life Insurance Do New Parents Need?

For parents, life insurance needs are substantial because you're protecting your children through 18+ years of dependency. Here's how to calculate appropriate coverage:

Income replacement: Multiply your annual income by 10-15 to provide enough coverage to replace your income until your children reach adulthood. For a parent earning $75,000, that's $750,000-$1,125,000.

Childcare costs: If you're a stay-at-home parent, calculate childcare costs from now through school age ($15,000-$30,000 per year per child for full-time care), plus after-school care needs through age 12-13.

Mortgage and major debts: Include enough to pay off your mortgage and significant debts so the surviving parent has reduced monthly obligations. Our guide on life insurance when buying a home explores this in detail.

Education funding: Plan for $50,000-$150,000+ per child for college, depending on your expectations (community college, state school, or private university).

Final expenses: Include $15,000-$20,000 for funeral and burial costs.

Let's look at a real-world example. Tyler and Megan have 2-year-old twins. Tyler earns $90,000 annually while Megan is a stay-at-home parent. They have a $350,000 mortgage.

Tyler's coverage calculation:

• Income replacement (12× annual income): $1,080,000
• Mortgage payoff: $350,000
• College fund (2 children × $100,000): $200,000
• Final expenses: $20,000
• Total: $1,650,000 (they round to $1.75 million)

Megan's coverage calculation:

• Childcare for twins until school age (4 years × $50,000): $200,000
• After-school care (10 years × $15,000): $150,000
• Household help: $50,000
• College fund: $200,000
• Final expenses: $20,000
• Total: $620,000 (they round to $750,000)

For both policies combined (20-year terms), they pay approximately $105 monthly—less than they spend on diapers, and far less than one month of infant childcare.

Explore more about appropriate coverage amounts for your age group.

Understanding Beneficiaries and Guardianship

When you have children, your life insurance planning must also address what happens if both parents die simultaneously—unlikely but not impossible. This is where understanding how beneficiaries work becomes crucial.

For families with minor children, consider these strategies:

Name a trustee: Rather than naming minor children directly as beneficiaries (which would require court-appointed management of funds), many parents establish a trust or name a trusted adult as custodian under their state's Uniform Transfers to Minors Act (UTMA).

Designate a guardian: Life insurance addresses financial needs, but you should also have a will that designates a guardian for your children. The life insurance proceeds can help support the guardian in raising your children.

Consider a trust: For larger estates or if you have concerns about how funds might be managed, a revocable living trust gives you detailed control over how insurance proceeds are distributed and used for your children's benefit.

When Hannah and Joel created their estate plan, they named Hannah's sister as guardian for their two young children and designated her as trustee of the life insurance proceeds. The trust includes provisions for education funding, healthcare needs, and housing support, with remaining funds distributed to the children at ages 25 and 30.

"We wanted to make sure that if something happened to both of us, our kids would be raised by someone we trust, with adequate financial resources, and that the money would be managed responsibly," Hannah explained.

The Working Parent's Dilemma: Is Employer Coverage Enough?

Many new parents assume their employer-provided life insurance is adequate. Unfortunately, it almost never is.

Typical employer life insurance provides coverage equal to 1-2 times your annual salary. For someone earning $80,000, that's $80,000-$160,000—barely enough to cover the mortgage, let alone 18 years of raising children.

Additionally, employer coverage has critical limitations:

It's tied to your job: If you change employers, get laid off, or become too ill to work, you lose coverage when you need it most.

It doesn't increase with your needs: Your employer policy might have been adequate before children, but it doesn't automatically increase when your family grows.

It's usually term only: Employer policies rarely build cash value or offer conversion options.

Limited customization: You can't adjust the death benefit, term length, or riders to fit your specific situation.

Think of employer life insurance as a supplement, not a substitute. Your personal policy should be the foundation of your family's protection.

Marcus learned this lesson the hard way when he was diagnosed with a chronic condition that forced him to take medical leave from work. His employer coverage ended just when his family needed it most, and his condition made him uninsurable for new coverage. "I'd always thought my work policy was enough," he said. "I didn't realize it was only there as long as I was healthy and employed—the very circumstances when I needed it least."

The Evoro Life Difference

At Evoro Life, we specialize in serving young professionals and growing families—people exactly like new parents navigating life insurance for the first time. We understand that with a new baby, you're already overwhelmed with decisions, expenses, and adjustments.

That's why we've designed our process to be as simple as possible. Our digital application can get you from quote to approval in as little as 18 minutes for qualified applicants—no lengthy meetings, no confusing paperwork, no high-pressure sales tactics.

We provide clear guidance on appropriate coverage amounts for your specific situation, including your mortgage, income, childcare needs, and education goals. We help you see the complete picture of your family's financial protection needs so you can make informed decisions.

And because we focus on young, healthy professionals, we're able to offer highly competitive rates that fit into the already-tight budget of new parents. For many couples, comprehensive coverage for both parents costs less than their monthly streaming subscriptions.

Your Most Important Parenting Decision

As a new parent, you'll make thousands of decisions about your child's wellbeing—what they eat, where they go to school, how you spend your time together, and what values you instill. But few decisions are as consequential as ensuring they're financially protected if something happens to you.

Life insurance isn't about planning for the worst—it's about ensuring that your love and commitment to your children extends beyond your lifetime. It's about giving your children the stability, opportunities, and security you want for them, no matter what the future holds.

The peace of mind that comes from knowing your children will be financially secure even in your absence is one of the greatest gifts you can give yourself and your family. Don't let it fall through the cracks during the busy, beautiful chaos of new parenthood.

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