As a senior, your children may be grown, or you may be a widow who no longer requires the same coverage you used to. But your life insurance policy doesn’t have to stay active just to provide some benefit to your loved ones after your passing. Instead, you can sell your permanent life insurance policy for a cash value that will help you fund retirement and live more comfortably. On top of that, you can purchase a smaller policy specifically designed to help seniors leave money to their loved ones.
Why You Should Keep Life Insurance
Even if you no longer require a substantial amount of coverage, life insurance policies give families peace of mind and relieve stress after someone dies. Without any coverage, funeral costs and other expenses related to settling a loved one’s estate can quickly mount up. No death benefit means the cost falls squarely on the family’s shoulders, and it can be difficult to manage the financial burden on top of their grief.
Life insurance, even small amounts, makes it easier for families to cope with their loss by relieving financial strain. You may also want coverage with a higher death benefit to leave something behind. Leaving a fortune with your own income may not be feasible, but a sizable death benefit of $500,000 to over $1 million can be acquired for several hundred dollars a month. Keeping your coverage without leaving behind a large inheritance is still possible by settling your current life insurance policy and buying a smaller one. You can review a guide on how to cash out your policy to give your finances a boost. It is filled with plenty of helpful explanations on the settlement process and how to choose the right company for maximum profit.
Do You Have Enough Money for Retirement?
Many seniors close to retirement age who are getting retirement ready are shocked to discover how expensive it is to afford basic essentials. While the cost-of-living adjustment gradually increases the amount of money beneficiaries receive, it is not enough for the average person to afford rent, mortgage, or other major costs without supplementary income. For many seniors who realize their social security isn’t enough to live on, they’re forced to work forever or cut drastic corners just to survive.
But you worked hard for decades, and you deserve to enjoy retirement in comfort. Having a life insurance policy, you can settle can give you additional funds that boost your retirement budget. This can make it possible for you to age in place, move somewhere you always wanted to go, quit working or at least reduce your hours.
Other Factors to Consider
If you still provide for your loved ones, such as through a mortgage in your name, then a death benefit can keep them in place after your passing. While ownership should be transferred to a beneficiary through a will, you should also consider the cost of loan payments, utilities and taxes. There are also grandchildren to consider, who you may want to leave money for after you pass. This money can be allocated to a college savings account or a custodial account until they come of age.
