There are approximately 349,500 people in Ireland who work as stay-at-home parents – and the vast majority of these (94%) are women*. The work they do is invaluable for their families and irreplaceable for the community, yet more than 8 in 10 people agree that the role of the stay-at-home parent is either under-supported or undervalued by society in Ireland. This is according to the findings of a new survey from the rapidly growing life and pensions provider, Royal London Ireland.

The nationwide survey of 1,000 participants in Ireland sought to understand people’s perception of the value of stay-at-home parents. In addition to this, Royal London Ireland compared these perceptions with their own research into the monetary value of the homemaker. The survey revealed that 93% of people underestimate the financial value of the stay-at-home parent. According to the life and pension provider’s calculations, which are based on real-world wage data, the cost to employ someone to do the ‘duties’ performed by stay-at-home mams and dads would be an estimated €53,480 per annum. Despite this, survey participants estimated the potential ‘salary’ of the stay-at-home parent at an average of €28,460 per year.

Commenting on the findings, Royal London Ireland said,
“While the role of the stay-at-home parent could be described as ‘priceless’, it is interesting to gauge the public’s perception of its value through our annual survey. It seems people continue to undervalue the role, pitching it at €28,460 which is similar to last year’s estimate by survey respondents of approximately €28,000**. It is also well below what we have calculated as the economic cost in 2022, which is €53,480.”

Highlights from the Royal London Ireland Stay-at-home Parent Survey included:

• 61% of survey respondents believe people in Ireland value the role of the stay-at-home parent.
• 43% of respondents believe most people value the role of the stay-at-home parent, but society as a whole doesn’t provide enough support to those in this position.
• 39% of people say Irish society doesn’t put enough value on the role of homemaker.
• More women (88%) than men (75%) believe that the role of the stay-at-home parent is either under-appreciated or under-supported by society.
• 18% of people think Irish society holds the role of the homemaker in high esteem.
• People estimated the value of the stay-at-home parent’s salary to be on average €28,460.
• 31% of people estimated the stay-at-home parent’s ‘salary’ to be €20,000 or less. Only 12% estimated it to be between €40,000 - €50,000, and just 8% of people estimated it to be more than €50,000.

Royal London went on to say,
“While 18% of people believe the role of the stay-at-home parent is held in high esteem by Irish society, it’s interesting to see that a large majority (82%) believe homemakers are not supported enough or valued by society.
“What is somewhat less surprising, given that this role is predominantly filled by females, is that more women than men (88% vs 75%) believe that Irish society doesn’t support or value the contributions of stay-at-home parents. This is despite the number of stay-at-home dads more than doubling in the 10 years from 2009 to 2019, rising from 7,000 to 19,900.*”

The Costs
Royal London Ireland considered a list of duties usually carried out by stay-at-home parents, before researching the cost of employing someone to do these jobs. The duties  are ones that parents carry out on a weekly basis such as cooking, cleaning, driving children to their various activities and so on. The calculations reveal that the annual cost to employ someone to do the household jobs usually completed by a stay-at-home parent would be an estimated €53,480.

“While the duties and responsibilities that fall upon stay-at-home parents will vary from family to family, we have run some calculations of how much it would cost to replace someone in this role.  Interestingly, our evaluation of the cost is more than the €48,946 reported by the CSO as the average annual earnings of a person in full-time employment. Our figures reveal that it could cost approximately €53,000, if not more, per year. And when we asked our survey respondents how much they think it would cost to employ someone to perform the duties of a stay-at-home parent, most under-estimated it, by thousands.”
According to the survey, the majority of people (81%) estimated the stay-at-home parent’s ‘salary’ to be €40,000 or less (see Appendix). While 12% of people estimated it to be between €40,000 - €50,000, and just 8% of people estimated it to be €50,000 or more.

Royal London concluded,
“It’s understandable that, without doing the calculations, many people may not accurately estimate what the cost would be to replace the stay-at-home parent. What is surprising, is just how much they undervalue it by. An accurate evaluation of this cost, from a financial planning perspective, is an important figure to contemplate by every family. If a stay-at-home parent was to pass away unexpectedly, their loved ones could be left with a large financial gap to fill during what would already be a very difficult time. And while money can never replace a parent, having adequate financial protection in place can help provide families with a financial safety net to meet some of these parenting costs."

We can help you understand how much and what type of financial protection you might need.

In order to secure a financial future, starting a pension is one of the smartest financial decisions you can make.
 
But what is best, to wait to be included in the upcoming Auto Enrolment or to set up an Occupational Pension?
 
Auto-Enrolment is due to be rolled out during the second half of 2024 and is for employees aged between 23 & 60 who are earning a salary of €20,000 or more. If these employees have no other pension arrangement in place, they will automatically be enrolled to this scheme with employers required to facilitate auto enrolment through their payroll.
 
The Auto-Enrolment is a Defined Contribution arrangement with contributions being paid by the employee, the employer, and the State. There are set contributions to be paid and there will be no flexibility with this. Contributions will increase every three years as follows.
 
Year       Employee Contribution       Employer Contribution       State Contribution
1-3                   1.5%                                                1.5%                                       0.5%
4-6                   3%                                                  3%                                          1%
7-9                  4.5%                                               4.5%                                       1.5%
10 +                   6%                                                  6%                                         2%
*Employer and State Contributions are capped at €80,000 salary.
 
The Auto-Enrolment scheme offers only four investment choices and will run up to State Pension age with no access to funds prior to this.
 
Although it is of course welcome that more people in Ireland will now have a pension in retirement, it must be understood the employees included in the Auto-Enrolment will not avail of the same benefits available from an Occupational Pension. An Occupational Pension can be open to all employees with no strict criteria to be included. This gives you the opportunity to include  employees in a pension now ensuring that they do not lose out on valuable time and savings ahead of their retirement.
 
An individual occupational pension gives  employees more flexibility in terms of how much they want to contribute, a wider range of investment choices become available to them with the added benefit of financial advice.
 
Under an occupational pension members have the option of taking their benefits from age 50 and move their existing pensions to new employments if required.
 
For contributions made by the employee, into an occupation pension, they can avail of tax relief at their marginal tax rate, and this is extremely beneficial for employees within the 40% tax bracket.
 
It is important for employers to seek advice to satisfy future obligations in terms of pension provisions under the traditional route by setting up an occupational pension scheme or employer sponsored PRSA. 

Contact us to discuss the impact Auto-Enrolment can ahve on your company and your employees. 

In the hustle and bustle of our daily lives, we often prioritise immediate needs and desires over long term financial planning. It's all too easy to put off purchasing personal financial protection products like life assurance, specified illness cover, and income protection. However, this procrastination can have serious consequences for our financial security and peace of mind. We’re going to give you a few reasons why you should not delay in taking out these essential financial protection products.

The first and most important reason is that life is unpredictable, and unexpected events can happen to anyone at any time. The sudden loss of a loved one or a primary breadwinner can leave a family in financial turmoil. Life assurance provides a safety net for your loved ones, ensuring that they are financially supported in the event of your untimely demise. Delaying the purchase of life assurance can leave your family vulnerable, especially if you are the sole provider.

If you have dependents who rely on your income, it is your responsibility to ensure their financial security in your absence. Life assurance is a way to fulfil that responsibility. The longer you delay, the longer your loved ones remain exposed to financial risks. By taking action now, you can ensure peace of mind for all of you.

It’s also worth considering that a serious illnesses like cancer, heart disease, and stroke can strike without warning. These conditions can not only take a toll on your health but also your finances. Specified illness cover provides a lump sum payment if you are diagnosed with a covered illness, giving you the financial means to cover medical expenses, seek specialised treatment, or make necessary lifestyle adjustments. Delaying the purchase of serious illness cover could leave you financially unprepared to cope with the costs associated with a critical illness.

Similarly it’s worth noting that your ability to earn an income is one of your most valuable assets. Income protection insurance ensures that you continue to receive a portion of your income if you are unable to work due to illness or injury. Without this protection, you may find yourself struggling to make ends meet during a period of reduced income. Delaying the purchase of income protection can leave you vulnerable to financial hardship in the event of unforeseen circumstances.

The good news is that one of the benefits of purchasing personal financial protection products early is that you can often secure lower premiums and better cover. Insurance companies typically charge lower premiums to younger and healthier individuals. By taking action sooner rather than later, you can lock in more affordable rates and potentially access more comprehensive cover.

Overall, it’s about peace of mind. Financial stress can take a toll on your mental and emotional well being. Knowing that you have adequate financial protection in place can provide you with peace of mind. It allows you to focus on your present and future without constantly worrying about the "what-ifs." Delaying the purchase of these protection products can result in unnecessary stress and anxiety.

​We’ll leave you with a suggestion. Don’t delay. By acting now, you not only protect your loved ones, but also secure your own peace of mind.