Retirees Need Life Insurance, Too!
By Pekin Insurance · Sep 24, 2020 ·2 min read
When you look out at the retirement landscape, the scenery changes at a rapid pace.
How do you plan for these shifts?
Start by exploring your life insurance options for retirement. Life coverage can deliver financial stability when your loved ones really need it!
Life Insurance and Debt
An elderly household is headed by individuals aged 65 and older. The percentage of elderly households that have debt INCREASED FROM 37.8% IN 1989 TO 61.1% IN 2016.
If you’re at or near retirement, you’ve thought about debt, your savings, and Social Security.
Then there’s the toughest question. How will your loved ones handle your debt if you pass away before paying it off?
Thankfully, life insurance could help them cover:
- Car payments.
- Living expenses.
- College loan payments.
Term Life vs. Whole Life
What are the differences between the two main types of life coverage, term life and whole life?
It’s like comparing renting (term) and making a monthly payment to own (whole). There’s more to it than that, though.
With term life, you have insurance for a set period of time like 10 years.
Term Life Advantages
- Less expensive than whole life.
- Payments guaranteed for the term you signed up for.
- Can be converted to whole life.
Term Life Disadvantages
- Lasts for a limited amount of time unless you convert it to a different kind of policy.
- Might not work for you if you plan to cover lifelong needs.
- Your premium will increase after your level term period ends.
Whole Life Advantages
- Builds tax-deferred cash value.
- Provides lifelong coverage.
- Premiums don’t change.
- Offers the option of borrowing from the cash value of the policy.
- Doesn’t change with market fluctuation.
10 Reasons to Have Life Insurance After Retirement
- Life insurance allows you to spend funds on your own needs. Those assets will be replaced for your heirs income tax-free.
- If you use liquid assets to pay for long-term care, life insurance can replace those assets after you pass away.
- A portion of the death benefit can be used for additional care or other needs if you develop a terminal illness.
- The cash value of the life insurance policy provides a source of cash if an emergency pops up.
- The U.S. Bureau of Labor Statistics says 13 million people age 65 and older will still be working by 2024. Life insurance can provide money to replace that income for your survivors.
- The insured doesn’t have to gift away assets to avoid estate taxes because the policy will help pay the taxes.
- Life insurance can help divide assets among children from multiple marriages.
- The life insurance death benefit provides an extra source of cash while the surviving spouse adjusts to new circumstances. It can delay the need to make immediate financial decisions.
- Life insurance can help pay for final expenses, long-term care expenses, and medical costs that may not be covered by Medicare.
- Identity theft coverage is automatically included for all Pekin Life Insurance Company policyholders! Identity theft coverage helps stop fraudulent bills and charges.
Do you have life insurance questions? Your local, licensed Pekin Insurance agent has answers!
Contact your agent to find out how life insurance fits your retirement plan.