Would you cancel your auto insurance if you didn't make a claim in 10 years? Of course not. Yet some retirees cancel their life insurance because they think they don't need it. Consider several questions as you decide whether or not you need a life insurance policy if you're retired.
Will Anyone Experience Financial Loss After You Die?
If you're the primary breadwinner for your family, then yes, you need life insurance. It pays a death benefit to your beneficiaries and ensures they can pay daily living expenses or bills until they get on their feet.
If you don't hold primary responsibility for your family's finances, then you may not need a life insurance policy. Remember, though, that the policy's death benefit can pay a beneficiary's college expenses or help your favorite charity.
Do Your Survivors Need Money?
Your survivors may be fine without your life insurance payout. However, if they have a medical condition, college loan or young family, your life insurance policy payout could improve their quality of life.
Do You Own a Large Estate?
After you die, the tax bill on your estate could total thousands of dollars. Instead of dipping into savings, your survivors could use money from your life insurance policy to pay this bill and protect your assets.
Do You Have Adequate Retirement Income?
Your retirement accounts can determine whether or not you need life insurance. Talk to your financial planner and determine if you have adequate retirement resources. If you started saving late or didn't save enough, you may need life insurance to fill in the gap
your survivors will face after your death.
Can You Afford the Monthly Policy?
For some retirees, money is so tight that paying even a small life insurance premium isn't possible. However, if you can swing the few dollars, purchase a term life policy that will cover your funeral, repay your mortgage and relieve your spouse's financial worry.
Despite what you've heard about life insurance, it can be beneficial during your retirement years. Discuss your needs and options with your insurance agent as you prepare financially for the future.