Considering Life Insurance: What to Know as a Senior
As you move into your senior years, your financial priorities evolve. Providing peace of mind to loved ones and making informed decisions about long-term coverage becomes increasingly important.
Every September, Life Happens and LIMRA lead Life Insurance Awareness Month to educate Americans on protecting loved ones’ financial futures.
“This is a timely opportunity to explore how life insurance still plays a role in your financial toolkit—especially if you’re over 60,” says David Neuwirth, Senior Vice President, Investments at David Lerner Associates, Inc.
While the needs may differ from when you were raising a family or paying off a mortgage, life insurance can still be a meaningful part of your financial strategy.
Let’s explore the key factors seniors should weigh when considering life insurance.
1.Decide What Type of Life Insurance Fits Best for Your Needs as A Senior
There are several types of life insurance policies available, and choosing the right one depends on your goals, health, and budget.
Term Life Insurance
This offers coverage for a set number of years, such as 10 or 20. It’s often the most affordable option and can be a good fit if you need coverage for a specific period, like paying off remaining debt or providing for a spouse. However, term policies typically expire before the insured passes away.
Permanent Life Insurance
These include whole life and universal life policies, which provide lifetime coverage as long as premiums are paid. These policies often accumulate cash value, which can be accessed during your lifetime.
Guaranteed Issue Life Insurance
For those with health concerns, guaranteed issue policies don’t require a medical exam but often come with higher premiums and lower coverage limits.
It’s important to weigh your needs carefully. For example, if your primary goal is to cover final expenses, a smaller, permanent policy may suffice. If you want to leave a larger benefit to loved ones, universal life may be worth considering.
2.How Much Coverage You Actually Need at This Stage of Life?
This is a personal question with no one-size-fits-all answer.
Start by identifying your goals:
- Do you want to leave behind funds for a surviving spouse?
- Are you covering final expenses or medical bills?
- Is leaving a legacy for children or grandchildren important to you?
- Do you have charitable giving goals?
Calculate your potential financial responsibilities and subtract any existing assets available to cover them. This helps you arrive at a coverage amount that makes sense. Many seniors find that a modest policy is all that’s needed. Enough to avoid burdening loved ones with final expenses and provide a bit of support.
Keep in mind that life insurance proceeds are generally income tax-free for beneficiaries, which can make a meaningful difference in how your legacy is received.
3.Consider Whether Adding Riders or Extra Features to Your Policy Makes Sense
Life insurance policies often come with optional riders or additions that can enhance the policy’s value.
Accelerated Death Benefit Rider
Allows you to access a portion of your policy’s death benefit if you are diagnosed with a terminal illness. This can help cover medical or hospice care.
Long-Term Care Rider
Some permanent policies offer riders that help pay for long-term care costs if you become unable to care for yourself.
Waiver of Premium
This rider allows you to stop paying premiums if you become disabled, though it’s less common in senior policies.
These features can add flexibility to your policy and potentially ease the financial burden on your family. However, they usually come at an added cost, so be sure to consider whether they align with your needs and budget.
Conclusion
Life insurance for seniors isn’t a one-size-fits-all solution. Whether you’re thinking about protecting a loved one, covering final expenses, or leaving behind a legacy, the right policy can support your goals.
Start by assessing your current situation and what you hope to accomplish. Then, explore the types of coverage and features that best match those objectives.
You don’t have to make these decisions alone. If you’re exploring life insurance options in your later years, connecting with an investment counselor at David Lerner Associates can help you evaluate the right fit for your needs and your legacy. Take the next step toward protecting what matters most because smart decisions today can make all the difference for your loved ones tomorrow.
Material contained in this article is provided for information purposes only. It is not intended to be used in connection with the evaluation of any investments offered by David Lerner Associates, Inc. This material does not constitute an offer or recommendation to buy or sell securities and should not be considered in connection with the purchase or sale of securities. These materials are provided for general information and educational purposes, based on publicly available information from sources believed to be reliable. We cannot assure the accuracy or completeness of these materials. The information in these materials may change at any time and without notice.