As a military spouse, you never really know what’s going to happen next. You may be relocated to a new state or country at any time, and your spouse’s career may take them all over the world. This uncertain lifestyle can make it difficult to plan for the future, but one thing you should always have covered is life insurance. Here are the reasons why you need life insurance as a military spouse.
Understanding The Importance Of Life Insurance As A Military Spouse
Military families often neglect to adequately insure the spouse of the service member. Most military couples’ primary concern is covering the “breadwinner” of the family, who is more often than not the military member.
Active duty military members are covered by Service Members’ Group Life Insurance (SGLI) for $400,000 and military spouses are covered by Family Servicemembers’ Group Life Insurance (FSGLI) for a maximum of $100,000. Most military spouses have no additional coverage.
Military spouses need ample life insurance just as service members do, yet are limited to a quarter of the amount. While it is common that many military spouses earn less money than their spouses or are entirely absent from the workforce, spouses still need life insurance coverage to compensate for the substantial support they provide at home.
FSGLI is a poor attempt to provide that coverage. At first glance, this $100,000 number might seem substantial, but in most cases, this amount will not be enough coverage for families if something were to happen to the spouse. One must imagine all the things the spouse does for the family and how much it would cost to replace all those “services” the spouse provides. A spouse’s passing can have a lasting financial impact if not prepared.
Covering Your Family’s Basic Needs
If something were to happen to the stay-at-home spouse or army wife, imagine the financial hardship inflicted on the family, especially with children in the picture.
- How much it would cost to pay others for the household services once performed by the stay-at-home parent that would not or could not be assumed by the surviving parent?
- If the stay-at-home parent were to pass away, who would provide child care while the active duty service member works or deploys?
Families should add up how much it would cost to pay for childcare, especially with multiple children.
Whether it’s daycare, before and after school childcare, or after-school activities, it can add up quickly. For those who homeschool, calculating how much it would cost to educate each child also needs to be considered if parents wish to send them to private school to substitute the homeschooling they used to receive.
Life Insurance As A Military Spouse Used To Pay Off Debt
It is important to consider the family’s level of debt when determining additional coverage. Vehicle loans, credit card debt, mortgages, and student loans eat away at nearly every family’s budget. CNBC reports that the average U.S. household with debt now owes approximately $155,000.
This staggering number may or may not apply to you, but the overwhelming majority of households carry debt. Surviving spouses will be faced with the reality of making those debt payments alone unless a plan is in place. The crushing worry of debt added to an already stressful and emotional situation can be avoided by calculating the proper level of insurance and taking action now.
Ensure That Your Family Will Not Have To Endure A Financial Hardship
As a parent or spouse, you want everything for your military family. Protecting yourself in the event of your passing helps ensure that your family will never be faced with difficult or embarrassing financial decisions.
The sad fact is that after a spouse’s passing, many families without proper coverage are forced to make extreme budget cuts or even sell their homes just to make ends meet. Planning now for everything life can throw at you ensures that your family will never have to bear financial hardships after an already life-altering event.
Replace Potential Loss Of Income
If a military spouse were to pass away, how much income or future income will the family now go without? Spouses who may not be working now often return to the workforce later, especially when younger children become school-aged.
This future income bolsters net worth and increases standards of living. The loss of future income the two of you might one day count on to cover expenses or prepare for retirement could be devastating to the planned near-term standard of living changes or retirement plans.
Plan Now For Life After The Military
Having a supplementary life insurance plan in place for both parents ahead of the servicemember’s separation will not only ensure that each has an appropriate amount of coverage while still in the military, but also that a seamless transition can occur with no gaps in coverage or spikes in premiums once the separation is impending.
This is important; far too many service members fail to think about life insurance before transition because SGLI has been so automatic for them during their service. Locking in low premiums now will pay off dividends in the future.
Every year of age adds dollar signs to insurance premiums. Insurability with SGLI and FSGLI is also guaranteed, but insurability outside the military is not. The more you delay in obtaining proper coverage, the less likely you will be insurable and the more likely you’ll pay higher premiums if you are.
Recap: Life Insurance As A Military Spouse
There is no price that can be put on the peace of mind a service member and spouse will have knowing that their family’s financial future is secure. Being proactive and getting a term life insurance policy while young is ideal, even if you do not have children yet. And if your youth is behind you, it’s never too late to prepare for the inevitable. The cost of doing nothing is much higher than paying for insurance now.
Every year you grow older is a rise in the cost of your life insurance costs as well as the risk of uninsurability. So take control and get yourself covered. Compare rates and coverage options to find the right policy for you and your family. Book a call to get a FREE QUOTE. At Bush Life Agency, we have expertise in life insurance for military.
