Are You Covered for Life? Life Insurance Tips For Retirees

Life insurance is often only understood at a superficial level for something that can be incredibly beneficial. If this sounds like you, consider taking a deeper look at life insurance, as it may be your best protection for your loved ones if something happens to you.

Right off the back of Life Insurance Awareness month, we want to offer what we feel are the top tips and insights to be aware of, whether you currently have life insurance or are considering it.

We firmly believe life insurance should be a part of your retirement plan as it can provide an invaluable financial security blanket for your family. This in turn can ensure that debts or living expenses do not become overwhelming if you’re no longer there to support your loved ones.

Read on to learn our top life insurance tips.

Evaluate Your Needs

Evaluating your financial situation is key to understanding what level of coverage you may need. What does your nest egg look like? How many loved ones may depend on your support? Are your investments diversified? The answers to these questions can help you consider what type of insurance is right for you.

If you have questions about your needs, a Wealth Preservation Specialist may be able to help you navigate this evaluation process.

Consult & Choose Coverage

Like many financial situations, we often don’t realize the true cost of something. When considering life insurance needs, go beyond “major” payment considerations. Yes, the mortgage, car and general bills are important but evaluate potential medical bills, tuition or even a new roof. 

Once the financial considerations have been handled, it’s time to choose a policy. There are two main types of life insurance - term life and whole life. Term life covers you for a fixed period of time, after which the policy is nullified and premiums are no longer paid. Whole life is designed to cover you for life, but costs more. 

When to choose which? 

Term life can be an option if you still have major financial obligations, due to the fact that it’s cheaper than whole life. The money saved here can be invested into other assets such as stocks that may offer a higher return. Also, term life will typically have the option to be flexed into a whole life policy, although there is a window of time to make this decision. 

Whole life is best suited if the premiums are not a financial burden, you wish to leave an inheritance and you frame the cost as an investment, as whole life payouts grow at a rate set by the insurer. 

Because the list of financial obligations in retirement is long and considerable, and there are nuances to consider between term and whole life, we recommend speaking with a Wealth Preservation Specialist. This person can help you take a “30,000 feet view” and strategize for the long term.

Other Tips

  1. Consider health when evaluating life insurance: Rates will be typically cheaper when you’re younger and considered healthier. 
  2. Shop around: Different life insurance companies will offer varied rates. Evaluate and choose what’s best for you.
  3. Prepare for the process: The life insurance process can be lengthy due to the detailed application process. Be prepared to answer questions about your health, career and family medical history.
  4. Consult a Wealth Preservation Specialist: A financial expert is going to navigate you through the life insurance process. This help can be invaluable, especially when committing to a policy that ultimately affects your family after you’re gone.  

Final Thoughts

Like most things in life, proper preparation can greatly reduce stress and limit the potential for errors when making a decision. 

When considering life insurance - as it can be one of the most impactful investments you make- ensure that you’ve evaluated the tips we’ve mentioned here, as they can make all the difference. 

Are you covered for life? If not, let us help you leave a financial legacy that will cover your loved ones for years.

Take the first step today in scheduling a call with NJ.M Wealth Preservation Strategies.