Do You Need Life Insurance if You're Not Working header image

Do You Need Life Insurance if You're Not Working

Life insurance can fill a wide variety of needs, including covering your final expenses or caring for children who need your financial support after you’re gone. Life insurance has long been part of estate planning, but it doesn’t necessarily need to be part of every person’s estate plan. You might think that if you’re not currently working, you likely don’t need life insurance, but that isn’t necessarily true. Life insurance for unemployed parents and retirees can prove much more necessary than you think.

Whether or not you need life insurance when you’re not actively employed depends on a number of factors.

Stay-at-Home Parent 

It’s simply a myth that non-income earners, like stay-at-home parents, don’t need life insurance. As a stay-at-home parent you do a lot to take care of your kids and keep the house running. Life insurance for unemployed parents can provide a payout much more valuable than just covering funeral costs. As a stay-at-home parent, think of all the things you do in one 24-hour period. With proper planning and adequate life insurance, you can leave behind a financial gift that can help pay for all those things and more. Should the unexpected happen to you, you might need life insurance to take care of:

  • Daycare costs — The average cost of childcare is on the rise and if something were to happen to you, your children would need care while your spouse continues to work.
  • Help to keep the house running — As a homemaker, you do more than just care for the children. You have tasks like laundry, house-cleaning, grocery shopping and cooking. If you were to pass away today, your spouse and your children would have a lot to deal with, but leaving them the gift of life insurance ensures they’ll have help where and when they need it.
  • Planning for future expenses — Even if you stay home now, you might plan to return to the workforce later when your children are older. Would your household income look different 10 years from now? That’s something to keep in mind when you’re deciding if and how much life insurance you need.


Ask yourself the following question, “Will someone experience a financial loss when I die?” If the answer is no, perhaps you won’t need life insurance in retirement. A good example of this would be a retired couple who has a good source of retirement income from things like investments where they’re able to select an option that pays 100% to a surviving income, ensuring that income would continue in the same amount.

However, there are many situations in which life insurance for retirees is still a worthwhile expense:

  • Are you in debt? If you reach retirement and you’re still paying down debt on things like your home mortgage or even student loans, continuing life insurance coverage might be well-advised. Consider taking a “better safe than sorry” approach unless those debt payments are a small part of your overall net worth and don’t pose financial difficulty.


  • Are your children and spouse self-sufficient? If your children are out of your home and providing for their own families and your spouse is self-sufficient, you might not need life insurance. However, if you have children with special needs or kids who haven’t left home, you might want to keep it as they’re dependent on you financially. Another reason to keep life insurance is if your spouse would lose a substantial amount of your pension or other monthly payment upon your death. Life insurance can help fill that gap.


  • Would it help your estate? If you’re someone with considerable assets, you might be able to use life insurance strategically. For example, life insurance could take care of estate taxes, or perhaps pay off business debt or fund any buy-sell agreements related to your business or estate.


  • Do you support charities? If you regularly donate money to charities, schools, or religious organizations, you may want to consider owning a life insurance policy. After passing away, your life insurance proceeds can be paid directly to any organization that you would like to give one last gift to show your support after you are gone.


Get the Right Fit

Today’s life insurance policies can do more than ever before. With the right type of policy, you have many options to fit your needs and protect your loved ones. Talk with your local Farm Bureau agent and customize a policy that works for you and your family.

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