Some of your most important decisions will be about making sure you can financially care for your child, now and in the future.
Raising a child in New Zealand to the age of 18 costs an average of almost $250,000, according to an Inland Revenue study . The calculation doesn't include the cost of childcare or a parent's loss of income, and costs have rocketed since the study was carried out in 2009.
If taking out life insurance cover hasn't been at the top of your list of things to do in the past, now is the time to ask yourself what would happen if you or your partner couldn't be there for your child.
Buying life insurance is a classic 'what if' question - you buy it in the hope you'll never have to use it. Sorting out your life insurance early is a good idea as it protects your family and gives you peace of mind.
Help your family copeIf you or your partner were to die or be diagnosed with a terminal illness, could your family cope financially? To decide whether you need life insurance, ask yourself these five questions:
- Would your family be able to stay in your home?
- Would your family be able to pay off any other debts, such as credit cards, personal loans or hire purchase agreements?
- Would your family be able to pay the costs of groceries, clothing, nappies and other day-to-day expenses?
- Would your child's future education costs be covered?
- Would your family be able to pay for the funeral expenses?
Another decision you'll need to make is whether to insure both yourself and your partner if one of you is a full time stay-at-home parent.
If the stay-at-home parent died, the surviving parent would need to take time off work to look after the children - or pay a caregiver. Having life insurance takes away the pressure of loss of income or expensive childcare costs.
If you've decided to take out life insurance, you'll need to consider:'
- how much insurance to get
- what factors to take into account when you're choosing a policy
- how you can keep your policy safe.
For example, if your family's main breadwinner earns $60,000 a year, the family could multiply this figure by the number of years it would like the sum to be paid for (eg until the children are aged 18), and then take out coverage for that amount.
Simple and hassle-freeWe know you've probably got a list of fun things to do that are more interesting than checking out life insurance quotes, so we've done the hard bit for you without the added hassle.
LifeDirect makes it easy to instantly compare policies, prices, financial strength and customer service reviews of New Zealands leading insurers. The service is independent, transparent and free, and you're guaranteed the lowest price on the market. Compare life insurance quotes with LifeDirect today.
Once you've signed up with us, you'll also be able to see your policy, make changes or download a claim form online with MyLifeDirect, the personal insurance portal that's free to all LifeDirect customers.
LifeDirect's online application is fast, secure and takes most people only 10-20 minutes to complete. Which leaves you with more time to hang out with your baby (or catch up on your sleep).
Disclaimer: Please note that the content provided in this article is intended as an overview and as general information only. While care is taken to ensure accuracy and reliability, the information provided is subject to continuous change and may not reflect current development or address your situation. Before making any decisions based on the information provided in this article, please use your discretion and seek independent guidance.