How To Buy Life Insurance for Your Wife

The death of a wife can have a significant financial impact on a family.  With poor planning a family can be in severe financial trouble.  If you take the necessary steps, you can help prevent your family from falling under big financial burdens by purchasing life insurance for your wife.

First, you need to contact your company’s benefits office.   Ask them about your eligibility for dependent group life insurance.  Inquire about how much you can buy for your wife. If your wife is employed, she should contact her company’s benefits office and find out if there is company sponsored group life insurance.  She should find out how much coverage she currently has, and she should ask how much additional insurance she can purchase. Also, look into all other organizations you associate with that might offer reduced terms on life insurance for your wife.  There are many that she is potentially eligible for.

Now, to determine how much life insurance you need to purchase for your wife, perform the following calculations:

• Figure out how much you spend on child care.  Round this value to the nearest thousand dollars.
• Figure out how long it will take for your children to complete college.  Round up the gross annual income that your wife makes to the nearest thousand dollars.  Multiply that number by the years it will take your youngest child to finish college.
• Sum up the dollar amount for child care and your wife’s income times the years it will take your youngest child to complete college (you just figured out this number).  This will calculate your insurance need. 
• This is a very important step.  Check your math to make sure it is correct.  It would be terrible if you did not calculate this properly and your children were not able to go to a four year collegiate institution.
• Add up the total amount of group life insurance that your wife currently has.  Add additional amounts that you personally qualify for.

During the next open enrollment period you should sign up for group life insurance.  This will help make sure you meet the expected insurance need.

If there is a difference between the insurance you have and insurance you need, you will have to sign up for more insurance.  Unfortunately, this is almost always the case.  Apply for term life insurance.  This will help make up the difference and close the gap.  It may not fill the void perfectly, but there is no question it will really help in the future.

Life insurance is a necessary purchase to help your family.  Your family will be happy with your decision.