Retirement Planning And Life Insurance

This post is all about “Retirement Planning And Life Insurance”.

When people get past middle-age and get older, they start to consider planning out their finances more carefully. Most people have already bought some life insurance at some point but find that their needs and wants will to change as they start to get near to retirement age.

The original reasons for your choice of purchasing life insurance are likely to have changed dramatically. Your offspring are probably now adults themselves, and usually will have their own life insurance policies to protect their own children. By this time, you may well find that you have paid off your mortgage which means that your disposable income has increased because of it. At this point, you may well begin to wonder if life insurance should still be a part of your retirement planning.

Although you may have retired now, you may find that a life insurance policy should still feature in your future planning. These days, some pensions are not big enough for you to live on in your retirement and if you are widowed and lose one pension, your finances will face new pressures. It may be that the life insurance policy could provide funds to help you to cope with the drop in income if you are left alone.

Maintaining the life cover can be a good idea for various reasons. Some retired couples keep on buying life insurance so that they can leave an inheritance for their children and grandchildren. A life policy, particularly if you have written it into a trust, can provide a cash lump sum within weeks of your death.

Some people have term life insurance, this is often used as mortgage support, however it will only provide a cash sum upon the death of the insured person. An alternative is whole-of-life assurance policies. These often have an investment component which provides separate value growing throughout the policy term. This means that this sort of life insurance, which continues throughout your life, uses part of your monthly premium to fund this saving throughout the policy.

If the savings component has matured well over several years, you can opt to claim this part of money at any time. This could be used to provide a better standard of living for you as you mature. Otherwise, you could also pass the money on to your children. If you keep your policies up-to-date and renew them as they expire, you can continue with your retirement plans knowing that your loved ones will provided for when you are no longer around to do it yourself.


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