If your children have grown to adulthood, your home is paid for, and you are about to retire (or have already retired! ), it may appear as though the time for life insurance has passed you by. Perhaps you believe that your savings and investments, together with Social Security, will cover any future expenses.
Indeed, due to these assumptions, many empty-nesters and retirees are unable to obtain or maintain the essential life insurance coverage. If any of these four falsehoods apply to you, you may want to reconsider.
Myth 1: Once my children reach adulthood and I have paid off my mortgage, I will no longer require life insurance.
Perhaps, but even if you died today, your spouse would still be responsible for providing for basic needs. And what if your companion outlives you by ten, twenty, or even thirty years? Without life insurance, are your financial plans sufficient to enable your spouse to maintain the lifestyle you’ve worked so hard to achieve?
Myth 2: When I die, I will have amassed enough riches to leave something to my children and grandchildren.
Perhaps by working long hours and judiciously managing your family’s finances, you can attain this aim. What if, on the other hand, you do not live long enough to achieve your wealth-building objectives? Or what if the economy experiences a prolonged downturn, thereby impacting your investments? Instantaneously construct an estate with life insurance, allowing you to leave a legacy for future generations or fund a charitable organization or cause.
Myth 3: I felt I would require life insurance to assist me in paying inheritance taxes, but that is no longer necessary.
Even if you are not now subject to federal estate tax, this is not a foregone conclusion. Tax legislation is always evolving. Even if they do not, there are several additional reasons for later-life insurance. When you pass away, life insurance may cover expenses such as state estate taxes, unpaid bills, probate fees, and burial arrangements, allowing your loved ones to focus on their grief rather than financial concerns. Additionally, it can be used to ensure an equitable distribution of your estate among your heirs or to promote business succession.
Myth #4: Purchasing life insurance as I age will be prohibitively expensive.
While the cost of life insurance does increase with age, this does not mean that it is unaffordable. For example, a 55-year-old healthy nonsmoker may be able to obtain a 20-year, $500,000 level-term policy for approximately $1,600 per year. The annual cost is approximately $1,200 for a healthy 55-year-old woman. As a result, if you have an ongoing need for coverage, do not assume that you cannot afford it.
To determine your requirements, use our Life Insurance Needs Calculator. In general, an insurance specialist can assist you in determining a policy that matches your needs while remaining within your budget. To get started, use our Agent Finder.