Life Insurance for Seniors

There are many aspects to take into consideration when deciding to purchase life insurance as a senior. If you are making this decision already in your senior years, you likely are trying to ensure that the financial consequences of your passing do not negatively affect your surviving family members.

Consider the reasons why you need life insurance

There are several ways life insurance can protect your family after your passing, but you should consider what the reasons for it are before purchasing. It would be nice if we could pass on enormous financial legacies to our heirs, but this is not what term life insurance is for. Term life insurance is to mitigate the effects of the detrimental financial consequences of your death on your family, and there are several ways it can help.

The first is if you feel you need to cover the expenses of your funeral and your burial so that these expenses do not rest on your family. These costs can be over $10,000, and can be very burdensome for surviving family members. The second important reason for life insurance is to cover any unpaid debts that may remain to your loved ones after your passing. When a spouse is a co-signer on a mortgage, for example, they may be left with the mortgage after your death, but without your income to pay it. Term life insurance can provide funding for either of these situations, but you have to be realistic in what its purpose is.

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Consider how much insurance you really need

If you find yourself wanting to protect your family from these financial consequences, consider how much insurance you really need, and only purchase that much. Life insurance for seniors can be very expensive, so consider what it is you really need to protect, and insure to protect that amount. Also consider other financial strategies to buffer compliment life insurance. For example, if you are able to set aside $10,000 of your retirement funds to cover your funeral expenses, that may be the cheaper than purchasing term life insurance well into your retirement years.

Start planning early

If life insurance is in your financial strategy, then consider that the earlier you are able to purchase life insurance, the cheaper it will be in the long term. If you buy a long-term life insurance contract early, you will spend less money than if you had to repurchase short-term contracts repeatedly. Premiums that are decided based on your health at 65 will be much cheaper than those decided when you are 75, so try to get the cheaper premiums early and find a plan that provides guaranteed renewals when you need them. Often, these renewals will increase your premiums, but it allows you access to life insurance if your health situation has changed in a way that wouldn’t otherwise allow you to qualify.

Stay healthy

Most people think they would choose to stay healthy if they had the option, so it seems crass to say you should stay healthy in your retirement years. And while there are many factors of aging that are beyond our control from a health perspective, there are many more that are within our control. It’s never too late to commit to a healthy lifestyle, eating whole fruits and vegetables, not smoking, getting regular check-ups and a maintaining relatively active physical and social lifestyle. These factors can give you a clean bill of health that can significantly reduce your life insurance costs (not to mention help you enjoy your retirement years!).

How to avoid scams

If it looks too good to be true, that’s because it is. If you are a senior looking for insurance, be aware that there are a number of scams out there that can take advantage of your or a loved one’s situation. Contact trusted, independent, legal or financial advisors if you would like to get sound advice on life insurance for seniors or on a particular insurance contract, and contact your state regulatory agency immediately if you believe you have been a victim of any kind of insurance scam.

In the end, you should get a life insurance policy that meets your specific needs. Your friend may have a radically different financial strategy from you and that is okay. Consider what specific risks your family faces financially if you pass away earlier than expected and what financial products can mitigate that risk. Be realistic in what those financial products can provide, and shop around for the best options. Remember that life insurance is not a way to make your family rich when you pass away it is simply one of many financial strategies that can protect them during financially difficult times.

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