Senior Life Insurance

There are many uses, and quite a few different types of life insurance. My team and I are committed to educating the public on the needs and uses of life insurance.

Like other planning techniques, what kind of life insurance planning a person needs depends on their unique situation.


Reasons for Purchasing Life Insurance

FADU

We have found the following acronym a very useful life insurance planning technique. It helps our clients discover what their needs may be. The acronym is FADU.

– Funeral expenses: It is important to talk with your family about how you desire to be celebrated after you pass. Question such as; “do I want to be buried or cremated?” “What kind of ceremony would I like?” “Where would I like my final resting place to be?” These can be difficult questions to discuss, but important.

A – Administrative expenses: Planning for final expenses may include expenses to your family such as time off of work, plane tickets, hotel stays, etc. Probate may also be a cost factor for some, and is costly.

D – Debts: Most people do not want to leave the burden of unpaid debts to their loved ones. Life insurance is a cost effective way to ensure that your debts are paid off after you are gone.

U – Unpaid taxes: Tax expenses can also be a pretty hefty burden on one’s beneficiaries. Estate taxes come in to play for estates worth 3 million or more. Another tax problem we run in to quite often is tax on qualified money which can be as high as 35%. Imagine giving up to 35% of your qualified money to the IRS instead of your beneficiaries! Previous tax returns may also leave behind tax expenses.

 

What Options Are Available to Solve These Problems?

Whole Life Insurance

Senior Life InsurancePremiums with whole life insurance are typically higher than other life insurance products, but remain unchanged as long as you pay the policy premiums. The face amount (or death benefit) remains constant, and can be guaranteed for life, or to a certain age. Whole life insurance also builds account value (or equity) that may be utilized by you at some point to decrease your premiums, or give you more life insurance. This concept is similar to refinancing a home. You may also usually borrow, or even make withdraws from the account value. It is a good idea to utilize your cash value since insurance companies usually keep the account value when the insured passes. You may elect to pay the premiums for life, or you may pay the premiums over a shorter period of time such as 10 or 20-pay whole life insurance.

Learn more about whole life insurance

Universal Life Insurance

Universal life insurance is very similar to whole life insurance, except the premiums and face amount can usually be adjusted, which makes this type of life insurance more flexible. It can be guaranteed to last to almost any age, and also builds account value. Some universal life insurance plans are more geared to building account value and would have a higher premium. It may create a nice nest egg over a period of time. Universal life insurance plans may also be structured with the lowest possible premium to keep the policy in force, but may not build much account value. There are numerous ways to utilize universal life insurance for seniors.

Term Life Insurance

Term life insurance is sort of like renting insurance. It does not build account value, and lasts for a certain period of time between 10 and 30 years. The owner may opt to renew their term life insurance policies when it comes due, but at a much higher cost. Most of the time it is too high to even consider renewing the policy. The premiums during the term however, are much lower than that of whole life, universal life, and variable life insurance for seniors. This makes term life insurance ideal for families looking to cover debts.

Learn more about term life insurance

Final Expense Life Insurance

Final expense insurance policies are sometimes referred to as “burial policies”. This is usually whole life insurance for seniors with easier underwriting but higher premiums. Good for paying small face amounts from a couple thousand dollars to fifty thousand.

Second to Die

A joint life insurance policy that does not pay the claim until both owners have passed on. Usually only one owner needs to be insurable which can be useful. Policies for Second to Die life insurance for seniors are excellent tool for paying the tax burden on qualified money.

 

For more complete information about life insurance for seniors, please contact us today for a free consultation.