If you’re retired or approaching retirement, you may be wondering if you need to protect yourself with a life insurance policy. Whether you choose to go with or without, it can be a difficult decision to make. The good news is that most people who have reached their savings and investment goals at the time of retirement may not need life insurance at all. If they do a small permanent life insurance policy will do. There may be a few circumstances where you absolutely need to have a life insurance policy in force.
Let’s take a look at some instances where life insurance can be necessary in retirement. If you want to look into the cost of life insurance first, feel free to click on any of the boxes on the right to compare quotes instantly.
Loans
Whether you have a mortgage loan, business loan or any other loan of substantial size, it’s recommended you have a term policy to match the length of that loan. That way you don’t leave your spouse or dependents with any outstanding debt. It is common for retirees to purchase properties and other high end ticket items in their retirement. By ensuring that a life insurance policy will pay off any loans, you can have the peace of mind that your spouse will be able to enjoy the retirement as planned.
Wealth Transfer
One of the best ways to leave behind money for your family is life insurance. Because you are exchanging a smaller amount of monthly payments for a large lump sum that will go to your family. So if you want to give your children or grandchildren a financial head start, then you should most definitely consider purchasing a no lapse universal life insurance policy. The reason is simple, it is the most affordable permanent life insurance policy with no gimmicks and unlike term, it is not limited to a specific time frame. More and more people are doing this to improve the lives of their future generations.
Final Expenses
Unless you have a burial plot paid off and planned out, it can be a good idea to get a small 15k to 25k final expense policy. These policies are an affordable way to ensure that your family has the means necessary to cover the costs of the funeral and any last hospital bills. It is also much better for your family to receive funds from the policy rather than having to go through the hassle of pulling funds from your retirement accounts.
Estate Planning
Now if you have an estate with a total worth over $5.34 million dollars (in 2014) then you definitely need to have a life insurance policy that will cover the estate tax liabilities. Life insurance assets are exempt from estate tax, so there is really no better way to fund estate planning than through a life insurance policy. However estate planning is no simple matter, so be sure to seek legal counsel and help of a financial advisor.
Business Continuation
A life insurance policy can be a very efficient tool to fund any business arrangements in the event of your death. By leaving behind a large sum of funds, you can rest assured that your business will not run into a shortage of capital and continue to operate efficiently. In addition to that if you have partners in your business they may be required to buy out your shares from your heirs. Life insurance can help them to have the funds available rather than having to sell parts of the business or using business capital to do so.
Like mentioned before, it is usually not necessary to worry about a life insurance policy at retirement if everything went according to plan such as paying off your mortgage and reaching your retirement fund goals. But if any of the above exception match up to you it is pretty crucial to make sure you have a policy. If you are curious as to how much a permanent life insurance policy may cost click here. We represent over 60 top companies and can help you find both term and permanent life insurance options.
