Do you or don’t you need it?
For many people, life insurance is more than a way to ensure their loved ones are provided for in the event of their untimely death, it’s an investment that is an integral part of their financial plans. If you’re nearing retirement or already retired, you may be under the assumption that you either don’t need or can reduce your life insurance coverage. In reality, the opposite is actually true. Let’s take a look at the reasons why you may still need life insurance after you retire.
Providing security for your spouse
No matter how long you live, if you are married and your spouse lives longer that you do, your life insurance policy will ensure that he/she is taken care of. If you have large amounts of outstanding debts, having a life insurance policy that benefits your loved ones will ensure that they do not have to struggle paying the bills.
Replacing pension payments
You’ve worked hard all your life and in retirement, you’ve reaped the benefits of your commitment by receiving pension payments. The only problem is, when you pass away, your pension payments will cease and if you and your spouse have been living off those payments, your spouse will surely suffer financially without them. With a life insurance policy, you’ll be assured that he/she will have an income to pay for living expenses long after the pension payments have stopped.
A backup plan to cover unexpected expenses
A permanent life insurance or a cash value policy can help you get out of a difficult financial situation when something unexpected happens. You can borrow against the policy or withdraw some of the cash value depending on which type of policy you have. For many people, having this type of life insurance policy is also a means to accumulate value over their lifetime, although these policies are typically more expensive.
As an estate planning tool
After the policy holder dies, a cash-value or a permanent life policy can fund the funeral costs and provide the much-needed capital for estate and inheritance taxes. For many people, this is a viable solution to ensure that loved ones aren’t left holding the bag for these expenses.
For investment purposes
Having a life insurance policy that goes up in value the longer you live can never be a bad thing, right? Especially since the value of the policy continues to go up without inflicting income tax upon the policy holder. As long as you leave the policy intact and don’t borrow from it, you aren’t taxed for its increase in value. Many retirees view this as a much safer bet than the stock market, and because cash-value policies offer a higher growth than today’s savings accounts, there’s little argument that it’s a practical, tax-free way to accumulate wealth.
Retirement should be a time to relax and enjoy doing all the activities that you were too busy to do when you were working full-time. And for many retirees, there are logical reasons why having life insurance is necessary.
If you are getting ready to retire or are already in retirement and would like to learn more about the many life insurance solutions on the market, get in touch with us today. We have an array of products that will suit your unique needs and lifestyle.