Father’s Day Index 2023: Dad’s salary jumps 5% to nearly $55,000

Salaries are rising for many U.S. wage earners, and that includes American fathers. Dad’s 2023 “salary” in the last year jumped 4.8% to $54,996 from $52,474, according to an analysis by Insure.com. The increase keeps Dad’s earnings in line with current inflation of about 5% in April.

Each year around Father’s Day, Insure.com’s editors look at 17 household chores fathers do yearly and create an estimated annual salary for each task based on wage data from the U.S. Bureau of Labor (BLS) for comparable jobs. 

Examples of such work include landscaping and groundskeeping. The editors estimate that fathers spend about two hours a week cutting the lawn in the summer, raking leaves in the fall and shoveling pathways during wintertime. Landscapers and groundskeepers, according to the BLS, make $17.92 an hour. At that rate, for working two hours a week across 52 weeks, the annual pay would be $1,864.

The 4.8% boost in pay is a nice increase from last year’s index, which saw fathers’ salaries rise a modest 2.3% from 2021. However, that followed the 36% increase seen in the Father’s Day Index from 2020 to 2021, which was calculated during the Covid-related lockdowns and the spike in families learning and working from home – which meant more time helping kids with schoolwork and maintaining the house.

Unlike some years in the past, all of Dad’s jobs saw an increase this year. Among the roles that boosted Dad’s paycheck the most were pest control worker, accountant/auditor and plumber, which saw significant salary increases:  

• Pest control worker: Up 13%
• Accountant/auditor: Up 12%
• Plumber: Up 8.7%

Many jobs that saw nice salary increases in the Father’s Day Index are those where the need for talent is increasing. According to the latest BLS data, demand for pest control experts is projected to jump 7% between 2021 and 2031, accountant and auditor jobs are expected to grow 6% and the need for plumbers, pipefitters and steamfitters is estimated to see a 1.1% increase.

Overall, fathers’ wage increases this year are slightly ahead of U.S. workers’ overall salary increases. The Bureau of Labor Statistics in early June reported that average hourly earnings increased by 4.3% during the past 12 months.

However, despite their recent salary increases, Dad’s contribution to the family pales compared to Mom’s. In the past year, if mothers were paid for all their jobs around the house, they would have received a salary of more than $133,000, according to an earlier analysis by Insure.com. 

Note: Some professions might not perfectly match last year’s description due to editors updated selection of job titles.

Why it’s important for fathers to get life insurance

As we recognize dads this Father’s Day, it’s a good reminder to make sure Dad has an adequate level of life insurance protection. In case of death, there’s often a reduction in household income if a father dies – in addition to the tremendous emotional loss.

In a widely cited 2021 report from LIMRA, a life-insurance industry research firm, 42% of American families would face financial hardship within six months if a wage earner unexpectedly died.

For many families, the absence of a second parent necessitates hiring outside experts for household repairs, lawn maintenance and other essential tasks. Using the Father’s Day Index as a gauge, the cost could add up to almost $55,000 – and maybe more.

Life insurance can help lessen many families’ financial pain when a parent dies.

However, in 2023, only 52% of consumers reported owning life insurance, according to LIMRA. One reason: cost. Many families put off buying life insurance because they think they can’t afford a policy. But more than half of Americans overestimate the cost of life insurance threefold, according to LIMRA.

But another issue is a lack of familiarity with life insurance products. People often wonder about the right time to buy a policy, how much life insurance they need and what type of life insurance they should buy.

It’s never too soon to think about life insurance, says Amanda Kuhl, senior vice president and head of life products at New York Life.  

“While there is never a ‘too soon’ moment to purchase life insurance – and policies are less expensive the younger and healthier you are – life events like getting married, buying a home, starting a family, changing professions or securing a promotion are common life moments to re-assess your need for life insurance or existing coverage, as these scenarios often mean changes in who depends on you or the amount of income you’ll need to replace,” Kuhl says.

Which brings up the next question: How much does anyone need?

Life insurance requirements can vary significantly depending on age, stage of life or financial goals, says Stafford Thompson Jr., senior vice president of life and executive benefits business management for Lincoln Financial. 

“For example, someone in their twenties who just reached a life milestone such as getting married, buying a house or having a child may have simpler life insurance needs based around death benefit protection,” he says. “Someone in retirement may not need as much death benefit coverage at this stage of life but may still need the living benefits of their policy to enhance their retirement lifestyle and protect against retirement risks such as long-term care or taxes. There is no one-size-fits-all approach when it comes to life insurance planning.”

Fathers can determine a good level of coverage by looking at income, financial obligations, family needs, and long-term goals, says Alison Salka, Ph.D., senior vice president and research director at LIMRA.

“Fathers can start by reviewing what their needs and goals are and determining what they want to cover,” she says. “Would they want to replace their income, cover childcare and household expenses, cover debts and financial obligations, pay education expenses, or leave a legacy? These are important questions, and the answers point to types of policies and amounts.”(For more insights from Dr. Salka on fathers and the importance of life insurance, click here.)

Joel Purcell of Purcell Financial, a Northwestern Mutual insurance agent, offers the following guidance: “A common rule is that the death benefit should be 10 times the annual salary you’re trying to replace,” Purcell says.

He says Purcell Financial helps clients determine their exact amount of coverage based on three areas: Paying off all debts including the mortgage, providing resources for college expenses and replacing a portion of lost income for the remaining spouse so that the family can maintain a similar lifestyle until their youngest child is out of the house.

“There are different types of life insurance policies to consider,” Purcell says. “But keep in mind the most important consideration is making sure you have the [right] amount of coverage.”

How to choose a life insurance policy for dad

Indeed, some people don’t realize that there are different types of life insurance – term and permanent life – and that some policies are more affordable than others.

Term life policies last for a set number of years – such as 20 or 30 years – and families often find these policies affordable. Rates vary by company, age, health status and other factors, but the cost of term life insurance for a healthy 30-year-old is around $170 a year, according to a 2022 report from LIMRA.

“Term life insurance ensures you have protection for a temporary period of time and generally comes with a lower monthly financial commitment than other types of life insurance,” New York Life’s Kuhl says.

Permanent life insurance works a bit differently. The policy is effective as long as you’re alive and your premiums are paid.

Permanent life insurance — such as whole life,  variable universal life and indexed universal life — is more suited for those looking for coverage for longer periods of time and added policy flexibility, Lincoln Financial’s Thompson says.

“Permanent policies can offer lifetime death benefit protection, as well as ‘living benefits’ in the forms of cash value accumulation or riders that can be used for various financial planning needs such as supplementing retirement income, protecting a business or helping with long-term care expenses,” he says.

Whole life is ideal for individuals who want guarantees and the ability to accumulate savings, New York Life’s Kuhl says. Specific whole-life policies are also eligible for annual dividends that can be received as cash, used to reduce or pay premiums, or be reinvested into the policy and increasing the total amount of coverage, she says. 

In general, Kuhl says, consider whole life if you’re looking for:

• Permanent lifetime death benefit protection.
• Fixed, predictable premiums that are guaranteed not to increase.
• Guaranteed cash value accumulation that grows tax deferred and can be accessed, usually tax-free, to meet various financial goals.
• Additional potential cash value and death benefit growth through dividends.
• Tax-free life insurance death benefit.

In addition to Lincoln Financial, New York Life, and Northwestern Mutual, several other companies offer life insurance. Insure.com has put together a list of life insurance companies.

And to help families determine how much life insurance they need, Insure.com built a pair of valuable tools:

Insure.com’s Life Insurance Advisor offers a way to quickly analyze your assets and how much life insurance you may need.

Insure.com’s Life Insurance Coverage Calculator is designed to answer the big questions about life insurance: What type of policy do we need and how much coverage should we buy?

“Today’s life insurance market offers a diverse set of solutions across various price points so consumers can tailor coverage to their specific needs,” Thompson says. “Consumers should speak with a financial professional to help determine the type of policy that best suits their needs.”

Methodology

Mean hourly wages are based on current occupational wage data from the Bureau of Labor Statistics. It does not include income from work performed outside the home. The annual wage and percentages are rounded to the nearest whole number. Sums may add up to more than 100. The editors determine the hours and weeks each occupation is performed based on their research and the values assigned to those tasks in past indexes. Some professions might not perfectly match last year’s description due to editors’ updated selection of job titles.

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