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Do You Need Life Insurance After 60?

If you’re approaching 60, you might be rethinking your life insurance policy. With children grown and less dependent on your income, you may wonder if life insurance is still necessary. If your retirement savings, investments, and Social Security are sufficient to cover final expenses and support your survivors, you might not need life insurance in your 60s. However, in some cases, maintaining life insurance after 60 can be beneficial.

Reasons to Keep Life Insurance After 60

Life insurance can still be valuable at any age. According to Annuity.org, more than half (57%) of Americans aged 65 and up have life insurance. Here are some reasons to consider keeping your policy:

Supporting Survivors

Besides your spouse, you might support children still living at home or elderly parents who need care. Consider future expenses for your dependents, such as weddings or college tuition.

Paying Your Debts

If you have outstanding debts like a mortgage, car loan, student loan, or credit card bills, life insurance can help. When you pass away, your estate’s assets pay off these debts, reducing what your heirs receive. Life insurance payouts go directly to your heirs, easing their financial burden.

Replacing Income

If you’re still working, life insurance can replace your income and any job-related benefits that end with your death. Employer-provided health insurance or 401(k) matching contributions can be significant, and life insurance can help cover these losses.

Covering End-of-Life Expenses

Funeral costs can exceed $10,000, and there may be additional bills from nursing homes and medical treatments. On average, medical care in the last year of life costs $80,000, according to The Lancet. Depending on state laws, your estate or family might be responsible for these expenses.

Building an Estate

If you have significant assets, permanent life insurance can be part of your estate plan, helping you build cash value and leave tax-free money to your heirs.

Paying for Potential Health Issues

Long-term care insurance covers in-home or nursing care if you can’t manage daily activities. Some life insurance policies include long-term care or offer it as a rider. Other riders let you access your death benefit in case of a serious illness or disability.

How Much Life Insurance Do You Need After 60?

When purchasing life insurance, consider your expenses, outstanding debts, current financial obligations, and future financial needs. Subtracting your assets from your expenses will give you an idea of how much life insurance you need.

Options for Life Insurance in Your 60s

If you decide you don’t need life insurance, you can cancel your policy or let the term run out. Otherwise, you can:

• Keep your current coverage if it’s affordable.
• Renew an existing policy without a medical exam.
• Convert a group term life insurance policy to an individual policy.
• Purchase a new term life insurance policy.
• Consider no-exam life insurance options like simplified issue or guaranteed issue life insurance.

Cost of Life Insurance Over 60

Life insurance costs are influenced by your age, gender, health, coverage amount, type of policy, and credit score. Premiums rise with age, and preexisting medical conditions can increase costs or result in denial of coverage.

Term vs. Whole Life Insurance in Your 60s

Term life insurance is simpler and more affordable, lasting for a specific term with fixed premiums. Permanent life insurance lasts your whole life, builds cash value, and costs more. Choose the type that best suits your financial situation and needs.

The Bottom Line

Life insurance can provide security at any age, but whether you need it after 60 depends on your situation. Assess your financial obligations, resources, and family’s needs to determine if life insurance is necessary.

For any mortgage-related needs, call O1ne Mortgage at 213-732-3074. We’re here to help you make informed decisions about your financial future.

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