Do We Need More Insurance After Term Runs Out

[Robert Barney]

Remember, as you approach retirement and as you live in retirement, every dollar spent on life insurance, is a dollar less for your day to day cost of living.

And if you miscalculate, and cannot continue the insurance, then the money you spent, thinking it would serve a need later, is wasted.

Providing you weigh the cost and your ability to pay it, versus the other costs of living, and you have the money for life insurance, I would not argue against it.

But I also wouldn't argue against you spending it on chocolate.

 

[Tahoe Ray]

Remember, as you approach retirement and as you live in retirement, every dollar spent on life insurance, is a dollar less for your day to day cost of living.

And if you miscalculate, and cannot continue the insurance, then the money you spent, thinking it would serve a need later, is wasted.

Providing you weigh the cost and your ability to pay it, versus the other costs of living, and you have the money for life insurance, I would not argue against it.

But I also wouldn't argue against you spending it on chocolate.

Or you could buy one of the several GUL products on the market today with built in ROP features and get your money back if the cost is no longer tenable.

 

[pfg1]

A proper combination of perm life insurance and investments in retirement can often lead to substantially MORE spendable income in retirement and/or guaranteeing that you will never run out of income. Hopefully your advisor knows how to illustrate this to you. Obviously we don't know your whole situation, but if it was me... I would absolutely have permanent insurance.

 

[rcduggan]

A major piece of this puzzle is missing.... how old is the OP? That can make a big difference.

This is good to know and everyone here has some good input.


Needs have changed since originally bought. Ask yourself what the purpose of the life insurance was? What is your objective now? Life insurance is tool and when used right not only does it get the job done but it does so in a way no other financial tools can.

It's quite possible the previous agent is just trying to convert while you have the guaranteed issue from the conversion. There's a ton of variables missing here but you came to the right spot to get info on making the right decision.

 

[Bob_The_Insurance_Guy]

The Original Poster is gone. Never to be heard from again. We did not give him the answer he wanted, so he flew the coop.

Insurance is not a priority with him. Savings is.

It's like trying to sell a vegan the benefits of a whole grain diet.

If he does not know of/worked with a financial planner by now, what makes you think he will start. He obviously (incorrectly) believes that his children will not need him financially from this day forward.

If he does not die, and needs the money for LTC or stroke, etc., that $400K and won't last long. Hope his wife is ready to enter the work market.

 

[DHK]

It hasn't been 24 hours yet and you've already dismissed him?

 

[scagnt83]

The Original Poster is gone. Never to be heard from again. We did not give him the answer he wanted, so he flew the coop.

Insurance is not a priority with him. Savings is.

It's like trying to sell a vegan the benefits of a whole grain diet.

If he does not know of/worked with a financial planner by now, what makes you think he will start. He obviously (incorrectly) believes that his children will not need him financially from this day forward.

If he does not die, and needs the money for LTC or stroke, etc., that $400K and won't last long. Hope his wife is ready to enter the work market.

Excellent post Bob. Trying to convince people of something they already made their mind up on is one of the most unproductive things you can do as an agent.

If someone does not see the value of it they never will.


$700k in retirement savings is nothing... it wont even produce $30k in yearly income!!


If the OP thinks $30,000/y plus SS survivor benefits is enough for him or his wife to live on then no sense in convincing him otherwise.


But if they are in their 50s, it would be very likely that she will have to sell the house if he dies. Great thing for a widow to go through....
If they are in their 60s and close to SS retirement age, then maybe the $30k per year will be enough for her when combined with SS. That might get her to the $55k per year range.

 

[DHK]

Most financial planners don't how how to communicate the benefits of anything. They only talk about how smart they are and their capabilities. They act as though people can't get ahead financially without one, even though they believe they've done well without one so far. Yet being smart has no bearing or impact on why someone should want to work with a planner. There needs to be specific benefits or WIIFM, and only insurance strategies deliver benefits.

That's probably why many "do it yourself" investors avoid financial planners.

 

[Mattschmidt]

If the OP had an advisor he trusted he wouldn't be posting here, would he?

I thnk some people might, to get a second opinion.

 

[DHK]

Which is evidence of a lack of trust, or having the fear of making a wrong decision, or both.