A life insurance guide for new parents
Having a baby changes everything. If you're thinking about starting a family, there's a lot to consider. Here's what you need to know.
The cost of raising a child
Getting your bundle of joy from the crib to college costs a lot of money. As of April 2025, an average middle-income family can expect to spend approximately $318,949 to raise a child through age 17 (Credit Karma). That figure covers housing, food, and childcare, but not higher education. Add college into the mix, and your costs climb further. Your family may qualify for financial aid, but it may not be enough to cover rising tuition costs. Whether you're already a parent or just starting a family, financial and insurance experts recommend selecting a coverage amount that protects your loved ones for the years they'll rely on your income.
Housing
Food
Children/Education
Transportation
Healthcare
Clothing
Misc
Do I really need life insurance?
Every parent should consider having life insurance. While you may have a policy through your employer, it may not be enough once you become a new parent. As your household expands, life insurance becomes an essential part of planning for the future, not an optional product. It's there to protect your family in the long run, no matter what.
Common questions
Do stay-at-home parents need life insurance? Yes. Think of all the value you provide to your family. Replacing childcare alone could cost thousands per year. Add housekeeping and other services, and it's easy to see how a surviving parent could be left seriously struggling. In fact, if a stay-at-home parent earned an annual salary for those contributions, it would amount to $145,235 per year as of May 2025 (Insure.com). Don't underestimate your value. A life insurance policy is another way to bridge the financial gap when your family needs it most. How do beneficiaries work? A beneficiary is the person, persons, or designated trust that receives your life insurance policy proceeds if you die while your policy is in force. As the policy owner, you designate your primary beneficiary (typically your spouse, life partner, or children) when you fill out your application. Once you choose a policy that fits your family's needs, you'll have peace of mind knowing you've taken an important step toward protecting your family's financial future. Life insurance is there to help replace income, pay off debt, cover education costs, and ease living expenses for years to come. What type of life insurance is best for new parents? Every family is different, but there are two basic types to know: whole life (permanent; stays in effect as long as premiums are paid) and term life (coverage for a specific period of time). At Ethos, we offer term lengths of 10–40 years with $15,000–$2M in coverage at a fixed premium that never increases during your term. For new parents, term life is often the best choice. It can be more affordable than whole life and covers you during the years you need it most. A brand-new parent might choose a 30-year term to cover their child through adulthood. If your kids are already in college, a 10-year term may be all you need.
How much life insurance do new parents need, and what will it cost?
There's no one-size-fits-all answer. Many families want enough coverage to handle a mortgage, college tuition, and everyday living costs. Think of all the significant obligations that could be left behind: your home, any cosigned debts, and business commitments. A simple rule of thumb: multiply your salary by 10 as of September 2025 (Forbes), then add your outstanding debts, such as mortgage, estimated education costs, childcare, household expenses, and daily living. You may also want to factor in a year or two of your spouse's income, so the surviving parent doesn't have to return to work immediately while grieving. If your spouse is a stay-at-home parent, consider adding an estimate of what their salary would be if they had to return to work.
You can use the Ethos life insurance calculator to help estimate how much coverage you need and what your policy could cost.
Ready to apply? Talk to your agent today.
202 Ethos echnologies Inc. Ethos operates in some states as Ethos Life Insurance ervices. A license 0L24; A license 100142. Ethos offers policies issued by the carriers listed at www.ethoslife.comcarriers. roducts and their features may not be available in all states. he information and content provided in this document is for informational purposes only and is not to be considered legal, tax, investment, or financial advice. o contract is formed or amended by this document.
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