Retirement? Why You Still Need Life Insurance

Ahh retirement. You’ve looked forward to this day since you first started your job. You’ve worked hard day in and day out, and now you’re ready to kick your feet up and relax. Maybe you and your spouse will finally have the time to travel the world. Or perhaps you both feel content to stay at home and pursue your favourite hobbies.

After years of saving and investing, you and your partner are financially stable. You don’t have to worry about your mortgage or any other unpaid debts. Even if you died the day after retirement, your husband or wife could potentially live off those savings for the rest of his or her life.

Due to your financial stability, you can’t help but wonder if you should drop your life insurance policy as soon as you walk out your office door for the last time. It seems like an unnecessary expense, and you could use that extra money you would have paid on premiums and put it toward something more exciting, like a trip to Cancun or a new RV.

But don’t be too quick to call your insurance agency. The following reasons may make you want to hold onto your policy for a while yet.

You Have Children Who May Depend on You

Your children have grown and have already “flown the nest,” so to speak. But that doesn’t mean they don’t depend on you.

Statistics Canada estimate that nearly 42% of adult children could possibly move back home with their parents. In some cases this happens to help care for the parents, but in many instances, it happens to help the children ease their financial burdens. Often times these grown children bring in children of their own, so you may have a full house again in the near future.

Even if you have enough income to support your spouse at the time of your death, do you really have enough to support your children and grand-children? A life insurance policy can help your entire family and provide enough funds so your posterity can attend school or pursue a better career.

You Want to Equalize Your Assets

Even if your children are financially stable, you may still want to provide them with assets that will support their future. In these cases, a life insurance policy can help create a pool of cash that your children can divide among themselves when you have assets that can’t be divided.

For example, you have a getaway beach house about an hour from your home. You and your children loved going there together as a family, so you leave the real estate to them. After you die, they could fight and argue about who inherits the property, or perhaps they could come up with a thorough chart that determines what times each child can visit.

However, chances are likely that one child probably enjoys visiting the beach house more than the others. He or she might want to buy the shares of the cabin from the other children, and a life insurance policy can give your child the extra income to purchase those shares without dipping into personal savings. That child enjoys the beach house, while your other children enjoy the remaining cash from the policy.

You Have a Large Estate

Perhaps you own more than a beach house. Your high-paying position at your former job enabled you to purchase and maintain a sizeable home and property. While you can afford the property right now, your children might not have the ability to handle the estate taxes when you pass.

A life insurance policy can provide your children with enough funds to hold onto the family estate without having to delve into their own assets. They’ll still be able to live comfortably in the home, and you can rest peacefully knowing the property stays in the family.

You Want to Contribute to Charity

Children well cared for? Don’t have children? You can still use your life insurance policy to have a positive impact on those around you after you die.

If you wish, you can have your life insurance policy paid out to your favourite charitable organization. Naming a charity as your beneficiary can ensure that your legacy continues to help the less fortunate long after you die. And giving the money to your favourite charity can help your family save a lot of money in taxes.

Talk to An Insurance Broker About Your Policy

These are just a few reasons why you might want to hold onto your life insurance policy when you retire. You may find many more reasons depending on your situation.

On the other hand, not every policy is ideal for every person. To ensure you have the right policy for you and your family, don’t wait to talk to an insurance broker about your financial future.

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