Women underestimate the value of life insurance, and themselves

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Women have long occupied the role of caregiver in our society, often taking care of children, spouses, and elderly parents. It’s often argued that women are the backbone of our society, serving as the hub around which the family grows and thrives. So it’s curious to note that in the last 50-plus years, as women have moved into the workforce in greater and greater numbers while still taking care of their families, they have largely failed to adjust the estimation of their own value.

Let’s add up the contributions you make to your world; include things like driving your children to school, soccer practice, and other activities. Don’t forget the income your job provides your family, the maintenance you perform daily in your household, the grocery shopping, and meal preparation. Do you care for another family member? A sick sibling, or maybe elderly parents? Now consider how many people you would have to hire to fill all these roles–you are one valuable asset!

Yet a J.D. Power and Associates report indicates that as much as 64 percent of American women carry nolife insurance, and those that do are generally under-insured. This is despite the fact that in our current economic situation, most women work outside the home, and frequently, they are the family breadwinner. Times have certainly changed, but our attitudes have not.

“Women tend to undervalue themselves and what they do in the home,” says Keith Bratz, Media Director of Penn Mutual.

Penn Mutual’s Worth for Women initiative publishes an annual survey about, among other things, how women perceive themselves as “good financial role models.” Tracy Marrocco is director of program marketing and leads the company’s Worth for Women initiative. She echoes Bratz’s sentiment about how women tend to underestimate their value.

“Women are earning more than ever, so they have a greater need for protection. More than ever they need to take those steps. Yet they still have this risk of running out of money in a longer retirement, being alone in retirement because women tend to live longer than men, and possibly ending up in a nursing home or assisted living facility. Chances are they took care of everyone around them, and now there’s no one left to take care of them,” Marrocco says.

Life insurance is important for women, Marrocco says, just like it is for anyone; it protects against the risks you can’t control. But there are issues specific to women, such as the potential to live longer. Plus, what women contribute over their lifetimes has significant value, one both men and women tend to overlook.

“Most women spend about 12 years out of the workforce, caring for children and parents. That contribution isn’t valued,” Marrocco says. “God forbid something should ever happen to them; the cost to replace them would be huge.”

What do you contribute?

The value of your contributions might be a little easier to see if you’re a parent, but single women can also benefit from the peace of mind that comes from financial planning, including life insurance. As investment vehicles became more and more confusing, with 401K plans, mutual funds, day trading and the like, Marrocco believes the fundamental need for life insurance got lost in the shuffle.

“Everyone wanted the latest, greatest thing that was going to earn you 30 percent or more,” she says. “We learned some painful lessons along the way. But there were some folks who had life insurance, whether it was a cash policy or final expense, who were OK.”

“With the economy, the way it is now, that message is starting to resonate,” Bratz notes.

Taking control of your financial destiny is important for women of any circumstance. The Penn Mutual Worth Survey for Women reports that almost 60 percent of women who thought they were good financial role models said they “will have accomplished great things” in their lives. Plus they were also more than twice as likely to take better care of themselves, and more than 30 percent they felt their opinions were important.

Finding your value

One of the challenges for women is that because they are so busy, taking care of their financial planning and life insurance needs gets put off. Both Bratz and Marrocco advise, however, that there’s no time like the present. You should also know that you don’t have to take care of financial planning or insurance needs alone.

“A lot of times women need to have a solid understanding. We need to accumulate information before taking action. But we also say it’s never too late to start, and you don’t need to do it alone,” Marrocco advises. “Seek out a finance professional you feel comfortable with. They’ll listen to what your needs are and what your constraints are. They can help you budget, savings, help you budget what’s necessary.”

Websites like WorthForWomen.com, the Penn Mutual site, offer calculators that help women evaluate their life insurance needs, and assist in financial planning for all stages of a woman’s life, whether you’re just starting out, starting a family, or planning your retirement, Marrocco says.

Life insurance calculators, and the “worth” calculator are a good first step to determining how much life insurance is appropriate for your needs. Taking the time to do the math and get a sense of what you’d like to plan for is often a huge step toward a sense of confidence and accomplishment that is crucial for women. Bratz explains that while the question of why life insurance specifically makes women feel more secure isn’t an easy one, there are a few easy extrapolations.

“It may be as simple as thinking ‘In this relationship I have the same value as my spouse,'” he says. “You can certainly begin to make some inferences, like if some women are covered on equal terms as men, what does that say to someone who isn’t covered at all? If you’re in a situation where your contributions are valued equally or as more than your husband, it permeates your overall view.”

“Life insurance makes women feel valued and secure,’ Marrocco adds. “It’s saying ‘I value myself enough to take these steps and therefore I’m confident I’m good role model and I have a plan in place to take care of things in case something happens.'”

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