POSTRETIREMENT BENEFITS PLANNING – VOLUME 4
Special Retirement Planning Bulletin
Death Benefits
If there’s one thing that can stop a retiree from relaxing and enjoying retirement, it’s the knowledge that their postretirement spending is erasing what could otherwise be left as a legacy to their children, grandchildren, or favorite charity or organization.
While leaving a legacy matters to most of us, few of us look forward to living a miserly existence to do so. Yet the compulsion to spend less in retirement may be strong if you don’t have a life insurance policy with guaranteed death benefits to ensure that there’s something to go to your heirs.
The Value of a Death Benefit
With a permanent life insurance death benefit, you have the means to ensure that your heirs, favorite charities and anyone else you care about can receive a benefit upon your death. Because the fixed death benefit is guaranteed as long as you keep paying your premiums, you never have to worry about how your spending will impact those you leave behind.
Permanent life insurance features a fixed premium, which means you know exactly how much you must pay to keep the policy in force, and you can easily budget that into your monthly expenses.
Life Insurance = Death Benefits + Living Benefits
In addition, because permanent life insurance policies accrue cash values, they can provide an added source of income during your retirement. If you don’t need the funds for income, you can save them for potential nursing home and long-term care expenses in the future.
During your lifetime, you may have had a death benefit provided through a group life insurance policy at work. Now, as a retiree, you can replace that with a policy you own, with a premium that never increases and a cash value that takes some of the burden off your savings.
In the next volume of the POSTRETIREMENT BENEFITS PLANNING series, we will go over terminal illness benefits.