Plum had a few reasons to shoot Winfred at that point. None of them were very good reasons, but murder generally isn't something people do for good reasons.
* She correctly believed that Winfred was definitely going to kill himself, one way or the other, even if his plan was terrible. His pride as a father and his shame at the bakery's financial failure both drove him to "fix" the problem. So killing Winfred herself instead would at least make it more likely for Wocky to get the money and save his life.
(She had no faith whatsoever in his ability to make a suicide look like a murder to Viola's discerning eyes.)
* She knew that little time remained to get the money for Wock. If Winfred's plan failed, it was unlikely they'd find another way to get that insurance.
* She was angry that Winfred was going to leave either her or Wocky to get rid of the evidence. He didn't tell her that Wocky was going to become an accomplice to his plot - and if he had, she would have been even angrier! - but she knew that somebody had to clean up. Above all, Plum did not want Wocky to become a criminal, so involving him in insurance fraud was something she absolutely wanted to avoid.
Winfred was forcing her and Wocky into a horrible position in the name of "protecting" them. There's some parallel here to what Godot does in T&T case 5.
Now, Winfred never says she was angry, explicitly, in the case. I wrestled with the question of whether or not to mention this, but I decided it was better to leave implicit. I don't even think she was ready to admit that anger played a role, conscious or otherwise, in her decision. She claims to have killed Winfred for Wocky's sake, but if she had truly been objectively focused on what was best for Wocky, she'd have swallowed her pride and asked Viola for a loan, knowing that Viola had money and cared for Wocky's well-being.
(Why didn't she do that? Remember that the Cadaverinis and Kitakis are implied to have had a feud, and even though Viola states that the feud is over, it would be pretty humiliating (in Winfred and Plum's eyes, at least) for the Kitakis to beg her for money.)
* Finally, I wanted to explore the theme that self-sacrifice is not inherently noble, and that "falling on your sword" for someone else can be selfish, especially if you don't ask them first. Wocky had to get his tendency towards ridiculous self-sacrificing overprotectiveness (seen in AJ-2) from somewhere.
Short version: Plum felt obligated to take any steps necessary to protect Wocky, but ultimately acted to protect her own pride.