A few weeks ago DW and I received some happy news that our first addition to the family is on the way!
So of course one of the many things we are now looking at is revising all our insurance needs. We’re both in our early 30s, great health/genes, and probably ~10 years away from FI. Here is what we currently have for coverage:
Health: full coverage for family thru one of our employers
Life: ~$500k for both of us thru my employer, can increase to $900k
Auto: $50/100/50k liability, $50/100/25k uninsured motorist
Home: $425k dwelling, $250k contents, $300k liability
No change needed for health insurance except for the additional dependent. As for the rest here are some open questions I’ve got:
1. How much term life insurance? Probably will get a 10-20 year duration and would like enough so the surviving parent will have flexibilty of working only if they want to while raising our child. Am I missing anything BIG from the below list to do my calculations?
3. Adding an umbrella policy. We currently don’t have one but as our savings continue to grow towards FIRE we’d like to add some additional protection, probably $1M for now. Related to #2, is there any reason why we should consider moving away from Farmers to purchase? They're not on the highly recommended USAA, TIAFF-CREF, NY Life, MassMutual, etc list I’ve read on other threads but they seem to be quite solvent. Am I missing something else in evaluating?
Welcome any & all thoughts. Thanks!
jblack
So of course one of the many things we are now looking at is revising all our insurance needs. We’re both in our early 30s, great health/genes, and probably ~10 years away from FI. Here is what we currently have for coverage:
Health: full coverage for family thru one of our employers
Life: ~$500k for both of us thru my employer, can increase to $900k
Auto: $50/100/50k liability, $50/100/25k uninsured motorist
Home: $425k dwelling, $250k contents, $300k liability
No change needed for health insurance except for the additional dependent. As for the rest here are some open questions I’ve got:
1. How much term life insurance? Probably will get a 10-20 year duration and would like enough so the surviving parent will have flexibilty of working only if they want to while raising our child. Am I missing anything BIG from the below list to do my calculations?
- Assets: current savings in retirement & taxable accounts
- Liabilities: mortgage, school loans
- One time expense: college fund ($100k today’s dollars)
- Recurring expenses & income
- Child-related & spouse living expenses: ~$3k/month for clothes, food, entertainment, car, vacations, piano lessons & little league, occasional baby sitter, public schools, etc
- Property taxes, utilities, all insurance
- Income taxes
- Social Security survivor’s benefit of $x / month (need to look up)
- Average SWR of 3.5% on the recurring amount needed
3. Adding an umbrella policy. We currently don’t have one but as our savings continue to grow towards FIRE we’d like to add some additional protection, probably $1M for now. Related to #2, is there any reason why we should consider moving away from Farmers to purchase? They're not on the highly recommended USAA, TIAFF-CREF, NY Life, MassMutual, etc list I’ve read on other threads but they seem to be quite solvent. Am I missing something else in evaluating?
Welcome any & all thoughts. Thanks!
jblack