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So you have finally retired from your job after putting in many long hours and devoting a large percentage of every week to the company that hired you. At this point in your life, you may have decided that it’s time to purchase a life insurance policy to protect your loved ones. Or perhaps your existing life insurance policy is almost ready to expire.
In either case, you need to ensure that your family members will be protected after you die. The hard part is often deciding exactly which type of life insurance to purchase; should you buy a whole life policy or choose term life insurance coverage? Buy life insurance When You’re Still Healthy Regardless of your decision, you will most likely be able to obtain life insurance coverage if you are still relatively healthy. Just don’t let the higher cost of insurance coverage prevent you from purchasing a policy—the cost will only continue to rise as you age. One of the factors life insurance companies consider when determining coverage eligibility and premium rates is a policy holder’s age. If you wait too long and end up suffering a serious medical condition, you may end up paying extremely high rates, or even worse, be denied life insurance coverage. Whole life insurance Policies Now that you are newly retired, you will need to choose which type of policy you want to purchase. A whole life insurance policy provides you with lifelong protection and set premiums that are guaranteed not to increase, as long as you continue to make your payments. Term life insurance Coverage Just as the name implies, term life insurance will provide you with temporary coverage that lasts only for a specific term. This means that unlike whole life insurance, your coverage will end as soon as your policy expires. It also means that you will need to estimate how long you will live. Imagine what would happen if you end up dying right after your term life insurance policy expired. Although term life policies are cheaper than whole life, it can mean taking an unnecessary gamble. You will also face higher costs every time you renew a term life insurance policy. If you choose to purchase term life insurance, you should consider a policy that offers low premium payments for a long term such as 30 years. A whole life policy may still be the better choice since it will provide you and your family with lifelong coverage. However, choosing a long-term term life insurance policy may be a suitable alternative, depending on your circumstances. You need to decide whether you prefer to purchase a whole life insurance or term life insurance policy. The latter costs less, but only provides you with coverage for a specific term, whereas a whole life policy offers you protection for the rest of your life. You’ll gain peace of mind, knowing that your family will be financially protected when you die. |
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