Parents – know your worth
August 30, 2015
According to a survey by a major life insurance provider1 a Dad is worth £21,601 a year. That’s the cost of replacing the work he does looking after children, ferrying the family around, doing some of the weekly shopping and other household tasks.
Those figures have been calculated based on findings that an average father spends 47.5 hours a week helping his family in various ways. Mums, perhaps unsurprisingly, were found to contribute more, at 65.5 hours a week, meaning they are even more valuable.
This is, of course, no issue whilst that time is being donated free. However, what happens if you are suddenly left in a position where you are unable to help? The survey also found that only 55% of Dads had any life assurance in place to take care of the family if the worst happened, and even fewer had critical illness cover should they find themselves incapacitated and unable to work.
Not only is there the value of the free time you give to your children and household but, according to a provider of income protection plans2, we also contribute up to 29% of our household earned income on bringing them up.
The cost of raising a child is persistently and significantly underestimated by people whenever the question is asked.
One company1 estimates it to be £229,251 from birth to age 21, the equivalent of £30 a day. To age 18, L&G estimate £184,392 – but the parents L&G surveyed all expected their children to be at home much longer than that. What all these statistics lead us to is the unpalatable but very important consideration of what happens to children if one of their parents is lost or becomes ill and is incapacitated. Not only, what if that parent cannot earn any longer, but what if they also cannot do any of that work around the house?
As many surveys, not only the two listed below, have indicated, a large number of parents are underinsured. This can be for many reasons, not least that the subject is a difficult one to face when the family, including parents themselves, are still young. However, given the costs of such cover are generally much lower than most people estimate, there are many more reasons why the subject should be discussed. Being a parent is a huge job but covering the admittedly small chance that the worst might happen is really quite straightforward.
1 Legal & General research, “Value of a Parent” 2015
2 LV= research, “The Cost of raising a child” 2015