We’ve all heard the self-proclaimed experts who say that you should only buy term and invest the difference and that once you reach retirement age, you won’t need your life insurance any longer.
That’s not necessarily true.
Here are our Top 10 Reasons why it is important for seniors to keep some amount of permanent life insurance in place even after retirement:
- Having life insurance in place allows you to be more aggressive in spending your retirement funds on your own needs because you know that those assets will be replaced for your heirs with the income tax-free life insurance proceeds.
- If you have to use other liquid assets to pay for long-term care of any kind, the life insurance benefit can take the place of those assets for your heirs when you die.
- You can usually tap a portion of your death benefit before you die if you develop a terminal illness and can use that money for additional care or other needs.
- The cash value in your life insurance policy can provide a ready source of cash if a financial emergency arises.
- Recent studies show that almost 70 percent of individuals expect to be working either full- or part-time in retirement. Life insurance can provide money to replace that income stream for your surviving spouse or partner when you die.
- You don’t have to gift away your hard-earned assets to avoid estate taxes because your life insurance will be there to help pay any taxes due.
- Not all retirees are debt-free. Life insurance can help pay off any debts you may have when you die.
- Life insurance can be useful in dividing assets when there are children from second (or more) marriages.
- Your life insurance death benefit provides an extra source of cash while your surviving partner adjusts to new circumstances and can alleviate having to make immediate financial decisions to generate cash.
- Life insurance can help pay for final expenses, long-term care expenses, and any medical costs that may not be covered by your insurance.
As you can see, having life insurance in retirement can help provide you and your family members with much-needed peace of mind. As the saying goes, “life insurance is not for those who die, it’s for those who live.” There are plenty more reasons to have life insurance as you get older, so think twice before you consider dropping any coverage you have. Talk with a professional insurance agent today for help in deciding how your life insurance coverage could benefit you in retirement.