It’s never comfortable to think about, or even plan for our own deaths. However, as we age, it’s something that should be considered. Many older adults choose to buy life insurance for a number of reasons. In fact, according to a study published by Policygenius, nearly 57% of American adults have life insurance. Why is life insurance important? While some believe it’s just another monthly expense, there are valid reasons to consider purchasing a policy.
We Live Longer
It’s no surprise that adults are living much longer than they used to years ago. In fact, the research from the Social Security Administration reports that the age expectancy for men is 84, while women can be expected to live until the age of 87. With the age expectancy increasing, it can be difficult to adequately prepare your finances.
Finance Final Expenses
The cost of paying for funeral expenses usually increases each year. Many older adults choose to pay for a policy so the burden of their funeral expenses doesn’t fall on their adult children.
Estate taxes can be very expensive. That’s why some seniors use life insurance in order to pay estate taxes instead of relying on their retirement savings to cover the cost.
Life Insurance Can Act as a Good Investment
There are some types of policies that can actually earn cash value while deferring taxes. However, they can be very complex. If you don’t fully understand your policy, you might consider consulting with a professional.
Types of Life Insurance to Consider
There are a lot of different types of life insurance policies. However, there are three main types of policies that each have different subsections. You can learn about the different types of life insurance policies here.
This type of insurance covers its policyholder for fixed amount of time, depending on that person’s preference. This is a popular type of policy, especially because the premium payment amount stays the same for the designated amount of time agreed upon in the policy. Many older adults use this type of life insurance to replace lost income to help pay a mortgage, college tuition, or business expenses.
This policy covers its policyholder for the duration of their life. This policy can be raised or lowered, depending on your situation. This policy helps people to preserve their wealth, while using it as a way to supplement long-term income.
Whole Life Insurance
As long as the policyholder pays the premiums, whole life insurance remains valid. This policy is more complex than its counterparts because it has both cash value and a death benefit. This means the policy covers expenses like funeral costs, while also covering endowments and estate plans.
Our Carespring facilities in Dayton, Cincinnati, and Northern Kentucky know how complicated it can be to plan out your later years. We always offer support for our residents and their families. To learn more about our facilities and offerings, you can contact us here.