Term Life Insurance Articles
Senior Life Insurance Becoming A Popular New Investment
2010-01-02
Life insurance coverage is for the living that will be left behind when you die. Even in the case of seniors, this becomes important if they want their survivors to be taken care of. The senior may not have a great deal of income, but it will be missed in the event he dies.
In this economic environment, life insurance should be bought for seniors for several reasons. First of all, many seniors have term policies that are about to expire, leaving some with no life insurance. The life insurance industry has recognized that people are now living longer, and as a result have lowered rates so that it is feasible that a healthy 70 year old will probably be able to buy a new ten year term policy at a reasonable and affordable rate. This will take the burden of your final expenses off of the table.
Another reason that seniors are buying life insurance is simply that it is a safe investment. With stocks and mutual funds down, and no one having any idea when they will bounce back, life insurance offers an investment venue in which you will not lose money. Also, life insurance can be bought to replace the retirement nest egg that may have been reduced by deflated market values, leaving a surviving spouse more comfortable. There are also tax benefits for having your money in insurance rather than securities or even in a bank. Those assets would be taxable as part of the estate when you die. Insurance proceeds are not taxable. They pass to your beneficiaries outside of probate, so there is no taxation applied to the proceeds. This can be very important in preserving money that you wish to pass on to your loved ones. Therefore, if you have any great sums of money, you might want to buy a single payment whole life policy, protecting that money and making sure the entire amount passes to your heirs.
Seniors can also get creative when buying insurance for an investment. Suppose you are the owner of an accounting firm. You have three children, one of which is an accountant who works with you. Naturally, you want him to inherit the business. However, the business is part of your estate. The assets of the business as such would be split evenly between them. To avoid this, you could buy enough life insurance with your son as the beneficiary that he could then buy out the shares of his two siblings. This is a win/win situation for all the children, as the accountant son retains his business, and the other two children who have no interest in accounting anyway also get their share of the estate without having to dispose of the companies' assets.
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Life insurance coverage is for the living that will be left behind when you die. Even in the case of seniors, this becomes important if they want their survivors to be taken care of. The senior may not have a great deal of income, but it will be missed in the event he dies.
In this economic environment, life insurance should be bought for seniors for several reasons. First of all, many seniors have term policies that are about to expire, leaving some with no life insurance. The life insurance industry has recognized that people are now living longer, and as a result have lowered rates so that it is feasible that a healthy 70 year old will probably be able to buy a new ten year term policy at a reasonable and affordable rate. This will take the burden of your final expenses off of the table.
Another reason that seniors are buying life insurance is simply that it is a safe investment. With stocks and mutual funds down, and no one having any idea when they will bounce back, life insurance offers an investment venue in which you will not lose money. Also, life insurance can be bought to replace the retirement nest egg that may have been reduced by deflated market values, leaving a surviving spouse more comfortable. There are also tax benefits for having your money in insurance rather than securities or even in a bank. Those assets would be taxable as part of the estate when you die. Insurance proceeds are not taxable. They pass to your beneficiaries outside of probate, so there is no taxation applied to the proceeds. This can be very important in preserving money that you wish to pass on to your loved ones. Therefore, if you have any great sums of money, you might want to buy a single payment whole life policy, protecting that money and making sure the entire amount passes to your heirs.
Seniors can also get creative when buying insurance for an investment. Suppose you are the owner of an accounting firm. You have three children, one of which is an accountant who works with you. Naturally, you want him to inherit the business. However, the business is part of your estate. The assets of the business as such would be split evenly between them. To avoid this, you could buy enough life insurance with your son as the beneficiary that he could then buy out the shares of his two siblings. This is a win/win situation for all the children, as the accountant son retains his business, and the other two children who have no interest in accounting anyway also get their share of the estate without having to dispose of the companies' assets.
