Retirement is a time for opportunity and change, including a reevaluation of how to best protect your loved ones during this next stage of life.
Even without employer coverage, there are many options for life insurance when you’re over 50 that can help take care of family members after you're gone. There is no one-size-fits-all solution, and coverage should vary based on your individual circumstances and needs. Purchasing a life insurance policy during retirement can help pay medical bills, outstanding debt such as a mortgage, funeral costs, and help ensure a financially secure future for your spouse as well as any dependent children.
To determine if you need life insurance during retirement and to gauge how much coverage is adequate, start by asking yourself a few simple questions:
Are your family members self-sufficient? Perhaps your spouse requires special medical attention or your young children still require a hand in helping cover expenses. A life insurance policy after 50 can deliver cash benefits that help family members maintain a comfortable standard of living when you are no longer around.
Do you plan to keep working? Many people are choosing to work well past the traditionally defined retirement age. A term or permanent life insurance policy can help protect your family from loss of income after you pass away.
Do you have outstanding debt or anticipate expenses upon your passing? Whether it's a mortgage balance, credit card debt, or a desire to take care of your own funeral and medical expenses, life insurance coverage in retirement can also help ensure that your family is not saddled with unforeseen expenses. Life insurance benefits can also be directed to help pay estate taxes, which may maximize whatever inheritance is earmarked for beneficiaries.
Are you seeking additional cash benefits for your family? A life insurance policy during retirement can provide an opportunity to leave family members with extra reserves, for example, to help fund a grandchild's education.
Choosing the right type of life insurance policy
Many retirees assume that advanced age might automatically disqualify them from getting life insurance, but that is not the case. There are term and permanent life insurance policies available that don't require medical exams, but only require you to provide health information.
A reliable option can be term life insurance, which provides protection for a set period of time. Term insurance is generally established with premiums that steadily increase over time and the policy provides coverage for a certain period of time or until you reach a certain age. However, many term policies do offer the option to convert to permanent life insurance for more long-term coverage.
Permanent life insurance, sometimes called whole life, offers protection for your entire life, no matter how long you live. While typically an initially more expensive option than term insurance, premiums on this type of policy usually remain consistent as you age. Many permanent life insurance policies also build up cash value over time.
Getting started
When shopping for life insurance during retirement, make sure to take stock of your individual situation and fully explore your options. Most companies offer a variety of information sources to help you evaluate the offerings. Talk to an agent or request a free information kit to explore the differences between policy types, and leverage online calculators and quote services to get guidance on the appropriate coverage amount.
Don't automatically assume the need for life insurance stops after retirement. With the right coverage options, you can enjoy added peace of mind that your family can be covered into the future.
This article is provided by New York Life Insurance Company for informational purposes only. This article is not intended to provide tax, legal, financial or accounting advice. Please consult your own professional for advice specific to your circumstances.