If you’re over the age of 50, life insurance is definitely something you should consider if you haven’t done so already. Rather than protection for yourself, a life insurance policy is protection for your loved ones that you leave behind after your death.
Considering options for life insurance over 50 involves some degree of planning and preparation:
Financial Dependents
When choosing a life insurance policy, you should first consider the people who may be financially dependent upon you. This includes spouses and children. While your spouse may have their own income, you should consider the impact your death (and subsequent loss of income) would have on their financial security.
Even if there’s nobody who is financially dependent upon you, life insurance should be considered because it is a way to leave behind assets for those you care about most. Also, keep in mind that despite death meaning a reduction in various expenses, there are still bills to consider (such as funeral arrangements) that may become far too much to outweigh what you could save beforehand to avoid leaving your loved one in a financial bind.
How Much is Needed?
Determining how much life insurance you’ll need is a tricky endeavor. Be careful to avoid brokers who are motivated by their commissions and want to sell you every kind of insurance known to man. A good rule of thumb to keep in mind is that the more coverage you want, the more money you’ll need to spend. Choose an option that fits into your existing budget that will also provide a stable amount of money in the future.
How to Qualify?
During the underwriting process, be prepared to fill out numerous health questionnaires. You might also have to submit medical records and/or have a physical exam by a nurse or doctor. Obvious detractions such as being a smoker, having an existing condition and family history may mean higher premiums.
What Kind to Buy?
There are many types of life insurance policies and insurance products for people over 50. Some of the most recognizable options include whole, variable and universal life policies. Each has its own distinct set of advantages you can choose between when it comes to buying your policy.
There are also additional sources of insurance-based protection. One such type is a health cash plan. Much like a Flexible Spending Account, a health cash plan is an insurance product that allows you to get cash back for qualified medical expenses. When you purchase your plan, you pay a monthly fee and can receive cash back for healthcare expenses, access to wellbeing services and the option to set up fixed cash payouts.
Life Insurance as an Investment
While it may be a morbid thought, life insurance policies can be excellent investment tools. One caveat is that the costs associated with purchasing a life insurance as an investment can far outweigh any future monetary rewards so make sure to do your homework if you’re considering this option!
Thank you. Good info.
Great post. Readers should be very careful with designation of beneficiary considerations. This is an area that can be really problematic. For example, I just had a client whose parent died and had a trust under will as the beneficiary. Trouble was the will was later revised and it had no trust. The attorney and then parent failed to revise the beneficiary designation, so the insurance company could only pay the proceeds to her estate. We than had to probate her will to get the proceeds. This was mishandled. My point is that beneficiary designations need to be handled with care and should be discussed with an estates attorney.