You’re a mom or a dad, a grandparent or other relative to someone that you care about. You’ve spent so much time providing for and protecting the loved ones in your life. What about when you’ve passed on? How will you care for them then? There are numerous methods to make sure that you give your loved ones a significant legacy, and one is through life insurance. This method lets you leave behind a financial bequest to the relatives that you choose as your beneficiaries. Naturally, a financial legacy can’t take the place of the memories and love that you have shared. Yet, providing in this way after your death is a great plan to secure a solid financial future for your beloved family members.
Am I too old to buy life insurance?
Fact: many life insurance policies will actually insure people who are over 70 years old, assuming that they are fairly healthy. Keep in mind, however, that your current health situation may limit some of your options or increase your premium costs. Overall, the best strategy is to start paying premiums on a life insurance plan while you are still in good health. However, there are still life insurance policies which will cover you no matter what your health status is. As you might imagine, this type of life insurance plan has additional premiums, increasing the overall cost.
Usually, life insurance is a tax-free expense, but be aware that terms and conditions can differ, depending on the specific type of plan that you go with. To make sure you’re obtaining the coverage that best suits you and your loved ones, talk about your life insurance choices with a professional insurance broker.
Insurance policy types: Term Life
Term Life insurance grants coverage for a limited time period or “term.” If you die during the time period set out by the policy, then your beneficiaries will get the full benefits of the policy in a lump sum. The term you are given by the term life policy depends on your age when the policy was started and potentially your health at the time of policy issuance, as well. For example, a 50-year-old person might be offered a 20-year coverage plan, while a 70-year-old would be more likely to be given a 10-year term. Usually, term life insurance policies are accompanied by a medical survey and potentially a medical exam, in order to determine premiums and the right term.
Insurance policy types: Whole Life
In contrast, a whole life insurance policy offers coverage for your “whole” lifetime, instead of a limited time period. Consequently, whole life coverage costs more than term life coverage. On the other hand, a whole life policy doesn’t “expire.” If you can afford the premiums, whole life insurance can be a great option, mainly because term policies often have a “cut-off” age for when they can be offered. If you’re planning on using life insurance as part of your retirement or estate planning, then you should look to “whole life” as your best option.
Should you get life insurance?
While many retirees can easily afford life insurance, others living on a fixed income may not have the money for yet another premium. If you find yourself in this situation, one potential solution might be for your children or other loved ones pay the premiums. This is perfectly legal, and since your children and loved ones are usually the beneficiaries of your life insurance policy, they may be more than willing to fund the premium payments.
A personal and financial decision like life insurance should be carefully studied and not entered into lightly. However, when properly implemented, life insurance can become a great gift to leave the next generation.