A Life Lesson in Life Insurance: Grief, Debt and an Uncertain Future

When I was only 16 years old, my father passed away after a short illness. My parents had never purchased life insurance, so the only help we received was from the Department of Veterans Affairs, since my father was a disabled veteran. I think we received approximately $2,000. My father’s funeral cost at least double that figure.

My mother was now saddled with grief, debt and an uncertain future. I watched her hand-wring over how she would pay for the funeral. She didn’t know if she could provide for my sister and me. She freely admitted that we probably wouldn’t be able to keep our house. My sister was in college and my mom didn’t know if my sister would be able to stay there. My own college career was in deep jeopardy.

My mom didn’t know if she could provide for my sister and me. She freely admitted that we probably wouldn’t be able to keep our house.

My mother already worked full time, but she had to take an additional job to make ends meet—one that called her out all hours of the night, seven days a week. She eventually rented out the house and moved in with family to keep costs down. But she also was quietly shoring up her life insurance policy.

When she passed away seven years after my father’s death, my sister and I had enough money to cover the funeral, take care of pressing bills and then some. I eventually used my share for a down payment on a house almost straight out of college. My sister tucked hers away in retirement accounts. The contrast of my parents has been a lesson to me on the importance of life insurance.

Life insurance is smart
A recent State Farm survey shows that a large majority of Americans (84%) believe that life insurance is a smart way to care for their family’s future, but that we aren’t following through with the important conversations that are necessary: 42% of survey participants with living parents have avoided having estate planning conversations. That’s a marked contrast!

Understanding that life insurance is important is not hard. If you’re the main breadwinner, you’ve probably thought about what would happen if you were suddenly gone. Maybe it has even crossed your mind how a long illness (and extensive medical bills) would impact your family. Or perhaps your family mirrors my parents: both parents worked and both paychecks were needed to cover the necessary bills.

Don’t put off the conversation
Even though we Americans acknowledge the importance of life insurance, if you’re like my husband, you don’t like talking about life insurance because it seems morbid or depressing.

Yet the same survey shows that once people make the decision to purchase life insurance, they really do have positive feelings about it more often than negative feelings. Their purchase leaves them with feelings like “protected” (36%), “confident” (22%) and even “relieved” (21%). If you haven’t yet had a conversation with your loved ones about purchasing life insurance, there’s no time like the present.


(Illustration: State Farm)

Taking action

You can start by assessing need with this Life Insurance Needs Calculator. Then set up a time to talk with your spouse or your parents (perhaps both). Address the concerns that each party has, but try to come out of the conversation with a timeline for purchasing a policy.

by Kirsten Coble

Kirsten Coble is a staff writer for the personal finance website Everything Finance. She also has her own blog at Indebted and In Debt, exploring the relationship between faith and finances, and dreaming of the day she can afford to be a stay-at-home mom to her two girls. Kirsten is an actual rocket scientist who doesn’t know most things that people think rocket scientists should know.

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