Half of households lack backup for breadwinner

Many American households would be in financial distress if confronted with the loss of a breadwinner, according to a recent survey from New York Life Insurance Co. The survey showed that if confronted with the loss of a breadwinner, more than 50% of Americans wouldn't have proper financial backup plans to fund their families' future adequately. The survey — of 925 Americans 30 and older — was conducted online in August by Ipsos SA. Eighteen percent of respondents said that their annual household income was less than $25,000, 23% said that it was between $25,000 and $49,000, 33% said that was is between $50,000 and $99,000, and 25% said it was more than $100,000. The average household income of participants was about $70,000. Respondents had six options from which to choose in the event of a loss of the breadwinner. Thirty-two percent said that they would rely on life insurance, 22% said that they would get an additional job, another 22% said that they would exhaust their retirement savings, 7% said that they would ask their family and friends for help, and 1% said that they would try their luck with the lottery. Meanwhile, 16% said that they wouldn't choose any of those options. “Life insurance is a critical part of a family's financial stability,” said certified financial planner Lisa Kirchenbauer, president of Omega Wealth Management LLC. “But there are other aspects that are important, such as emergency funds, cash cushions and traditional investment portfolios.”