Many seniors have achieved a level of financial security and may not consider life insurance important. Others may feel they don’t qualify or can’t afford the premiums. It is also a common misconception that life insurance is only meant for young families, dependents or those with significant debts.
Although some people see the need for life insurance more than others, life insurance for seniors has many benefits.
What are the benefits of life insurance for seniors?
Everyone’s financial situation is different, but life insurance has some valuable features that can benefit retirees. It is important to remember that life insurance is about your beneficiaries, not you, the policyholder. When you die, your executors can pay the funeral expenses, debts and taxes. Your partner or children may not have enough income to cover these costs, especially if they are financially dependent on you.
It covers the final costs
A funeral or celebration of life can be important. Costs vary depending on the service provided, but last year the average cost of a funeral in the United States was about $8,000.
It is quite difficult to go from funeral to funeral to funeral for a family member or close friend without worrying about how you will pay for everything. Having life insurance to cover these costs can ease the financial burden on your loved ones and allow them to do more.
Pay off any outstanding debt
20% of retirees have a mortgage and 67% have credit card debt when they retire. Some sell their homes, downsize, and use the remaining cash to supplement other sources of income. Others can get a reverse mortgage or home equity line of credit.
Considering life insurance as a financial tool is a great way to reduce stress and help prepare for retirement and the future. If you die, all your debts will be paid. However, the proceeds from life insurance policies can help loved ones pay off debts and expensive bills.
Provide financial support
If you are a spouse, your pension may not be the same as what you received before you died. Some annuities include a small percentage of the surviving spouse, while others offer a lump-sum annuity. If you win, your income may decrease. Do you have dependent children or others in your life who need financial assistance?
Support a charity
If getting insurance and contributing to something bigger than yourself is important to you, life insurance is a great way to do that. Many people are passionate about causes and philanthropy. Did you know that your insurance policy can make a generous donation to an organization of your choice? A death benefit can be used to create an ongoing estate such as a certificate.
