Should Seniors Buy Whole Life Insurance?
When it’s time to buy life insurance, the first decision you’ll make is whether to go with a simple plan or whole life insurance. One features a death benefit to cover final expenses, but the other works as a savings account that can help pay for retirement. Choosing the right one is a very personal decision, and it depends largely on your age, your needs, and your budget.
Term plans expire after 10 or 20 years, but whole life insurance plans remain in force for the rest of your life.
This makes them an attractive options for people who are young, but they aren’t always the right choice for people who are already in their golden years.
It’s a more expensive plan that becomes profitable over time, but most seniors simply won’t invest the number of years required to make it a smart investment
Building Cash Value Over Time
These plans are attractive for younger generations because they build a cash value over time. The premiums are larger than term life plans. A portion covers the life insurance, and the balance of each payment is essentially invested into savings and investment accounts.
People who are in their 30s and 40s can use whole life insurance as a type of savings for retirement, but it’s not a cost-effective choice for people who are already enjoying their retirement.
Other Options for Seniors
Elderly customers who want life insurance without the hassle of a medical exam can invest in plans that provide a basic level of coverage without a medical exam. Applicants will have to answer a personal medical survey as part of the application process. These plans are typically affordable and provide people with a basic level of coverage for their final expenses.
When reviewing life insurance policies, there are several factors to consider. Whole life insurance policies can be an important part of your retirement planning, but only if they’re put into place early enough.
If you’ve already retired and want to add some more life insurance, you’re probably better off going with term plans that suit your needs. If you aren’t sure which kind is the right choice for you, work with a life insurance agent to review the options and make a more informed decision.
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