Homemaker: Is your value underestimated?
The work you do can be translated to an amount of R450 000 per year. Insurance for homemakers is essential.
She calls herself a homemaker, stay-at-home mother, chief household officer or simply a housewife. She is up before everyone else in the house and goes to sleep last every night. She works long hours every day and does the equivalent of four or more full-time jobs. She does not receive a salary, but she is invaluable.
Gert is the director of a large company. His wife, Hettie, temporarily gave up her career as a teacher after the birth of their three children, ages 12, 8 and 3. She is now a full-time mother and homemaker and does not have a domestic worker who might help. She does all her housework, and drive the kids to their respective schools and extracurricular activities. She also makes sure that there is a home-cooked meal for her family on the table every evening. With special events she hosts and caters for their guests. Her husband and children’s lunchboxes are packed every day and their clothes are washed and ironed and carefully packed. In addition she helps her children every afternoon with their homework, she keeps careful record of all the household expenses and manages her household with an iron hand. The garden and pool also receives attention. When one of her ch,ildren gets hurt or if her children or husband falls ill, Hettie cares for them and nurse them back to health. If her husband or children had a bad day, Hettie is ready to comfort them and to cheer them up. Hettie plays the role of an interior decorator and use her creative talents to decorate the house. Small repairs in the house is also done by her and she knows who to contact if she can not solve the problem herself. She is also responsible for the pets’ care and well-being. Hettie receives no compensation for all the work she does and although her husband, the breadwinner, has a big life insurance to provide for the family when he is no longer there, the amount for which her is life insured, is quite small in comparison with what she does every day.
“I often feel worthless because I don’t earn a salary, but Gert and myself have sat together and did calculations and realised that I won’t have much of a salary left after expenses like daycare, professional work clothes, transport costs to my work, a full-time housekeeper, takeaways and an au pair for our children,” said Hettie.
- A homemaker plays different roles and includes inter alia the following:
- A domestic worker who works for a full time salary could easily earn an amount between R2 000 and R3 000 per month. A domestic worker who also work weekends and overtime can easily earn up to R4 500 per month.
- Babysitters or au pairs can earn between R4 500 to R8000 per month. Hourly wages can range between R35 and R80 per hour.
- A home nurse, supporting teacher, Pet Groomer, interior decorator and counselor will usually charge an hourly or per project rate and rates can vary greatly depending on education and experience.
- A driver or taxi driver can earn anything between R2 000 and R12 000 per month.
- A home cook or chef’s salary can start at R3 500 and experienced and highly trained chefs can earn huge salaries.
- A Junior Project Manager can easy earn R7 500 – R15 000 per month, while a Senior Project Manager can earn much more.
- A Junior Accountant can earn between R4 500 and R7 000 per month and a Senior Accountant much more.
(The salaries above are estimates and depend in general on years of experience, qualifications and training. Also bear in mind that a homemaker does not fulfill all the roles during all the hours of the day, but fulfills different roles during the day. Early morning she may play the role of a Chef when preparing breakfast, then the role of a taxi driver when she drops the children at school, then the role of housekeeper, cleaner and laundry lady, later she plays the role of a taxi driver when she goes to fetch the children at school, and later on the role of an Assistant Teacher, then chef again, counselor and nurse).
Other roles that a homemaker can play, which one don’t always think about, include:
- Event manager when you need to organise your children’s party and supervise the playing children.
- Secretary and clerk when correspondence and accounts must be handled and appointments to the doctor or dentist are made on behalf of your husband and children.
- Peace keeper when your children are fighting.
- Stylist and hairdresser when your children need help with makeup and getting dressed for a school play. Also deciding which new clothes your children would need.
- Discipline manager when you have to discipline your difficult teenager.
- Guesthouse manager when family and friends of your husband visit your city and you should provide entertainment and accommodation.
- Seamstress when you have to fix blazers and sew on buttons. Researcher when you have to help your child with a school project and do research on the Internet.
- Companion, lover and friend to your husband.
If Hettie unexpectedly dies, Gert could easily find himself in a financial difficulty when he suddenly has to appoint staff like a housekeeper, nanny, cook or chef, project manager and bookkeeper who could manage his household and children whilst he does his own job.
“By only ensuring the life of the breadwinner of the family, this could surely be the biggest mistake people make when they take out life insurance. The parent at home is often the babysitter, home chef, supporting teacher, housekeeper, project manager, bookkeeper, driver and much more,” says Lenerd Louw, CEO of direct life insurance company Frank.net.
“The contributions that a homemaker make to the household has great value and without a financial safety net that provides for their death, the surviving spouse and children are left without the means to the lifestyle to which they are accustomed to. The homemaker’s contributions are now lost due to death, disability or serious illness, and can lead to financial hardship for the breadwinner and the whole family”, says Louw.
Louw explains that it is estimated that a homemaker does on average 94.4 hours “work” every week, and that it will cost the average family a total of R450 000 per year to pay for the basic work done by the homemaker.
He warns: “Do not be conditioned by believing that the value of an individual is measured by the income he or she generates. “In a family, the homemaker is as much a contributor as the person who earns the money, and financial losses that will be suffered in the homemaker’s absence, is a clear proof of this.”
“The loss of a loved one is not only an emotional deprivation, but is also accompanied by massive financial stress. In essence, it is necessary to place a price tag on parenting and understand their valuable role within the family unit, outside the context of emotional ties and support”, explains Louw.
According to Louw, a surviving spouse is faced with many challenges such as working longer hours to cover additional and unexpected expenses, to perform tasks that were performed by the homemaker-spouse, find time to grieve and support the family emotionally and also to take over the household responsibilities that were previously shared.
Louw identifies two important questions you should ask yourself:
- If you would lose your homemaker spouse, how much would this cost you financially?
- If the surviving spouse had to take long leave from work, what would the financial implications be?
“The role of the stay-at-home parent will have to be filled by the surviving spouse or other support person and life insurance can help to cover these costs”, says Louw.
Louw recommends that the following should be considered:
Childcare. The need may arise to hire au pairs and drivers to assist with childcare and transportation. If you have very young children, day care might even be necessary.
Household. Daily tasks that need to to be done might result in extra costs including laundry and cleaning costs. You may perhaps not previously had a domestic worker in service, and a full-time housekeeper can cost you up to R3 000 per month.
Day care: If the breadwinner of the family spent five days a week and a lot of time traveling to and from the office, all these factors must be taken into account to calculate a realistic amount for which insurance will be required.
How much life cover?
“With the appropriate coverage amount, your family will have the opportunity to maintain their quality of life they are used to. Louw recommends that the following should be considered:
Lifestyle
How many children
The working spouse’s income (if leave would be needed)
Housekeeper / au pair / chef / driver’s salaries
“To lose a parent, best friend and lover, is already difficult enough without having to add more financial pressure”, says Louw. “Life insurance will ensure that the surviving spouse will not be forced to spend long hours at work or even to find a second job to pay the bills. Instead, more focus will be placed on their family during a critical time in their lives. It is essential to realize the importance of ensuring adequate insurance for spouses”.
Life insurance myths:
Lenerd Louw, CEO of Frank.net, provides insight on general life insurance myths.
Myth 1: Life insurance is not affordable
Life insurance for most South Africans are very affordable. Coverage can be obtained for as little as R100 per month, depending on your individual circumstances.
Myth 2: Most people have enough insurance.
South Africans are very under insured. Despite the importance of life insurance, only 12% of South Africans have life insurance and only 6% have some form of income loss protection.
Myth 3: It is always better to use a company that is offering a cash-back bonus.
If you decide to use this option, make sure you look carefully at the product benefits. Go to what is covered and what is not covered. It might not be the right policy for you and you may not get the coverage you need.
Myth 4: Accidental Death cover provides adequate coverage
Accidental Death Coverage means you have no cover for death due to natural causes. This is really a bad idea and is especially a bad move as it replaces a full life policy.
If you need insurance for a potential car accident, you also need insurance for a potential heart attack.
Myth 5: Not everyone requires a life insurance plan
The opposite is true, everyone needs an insurance plan. You may think that you enjoy good health, but it does not necessarily mean that you do not need life insurance. But what about salary protection, serious illness and disability?
Everyone should have some form of protection. You should protect yourself and if you have a family, protect your family. Any form of coverage will be of great value if anything should happen to you.
