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Blog

September 25th, 2018

9/25/2018

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​Every financial strategy needs to be reviewed from time to time. Life can change quickly, and when it does, it’s important to make sure your financial strategy is still appropriate for your needs and goals. For many people, financial review often means analyzing investments, budgets and other documents.
 
You may not think that life insurance needs to be reviewed. After all, it’s a fairly straightforward tool. You pay a regular premium, and, in exchange, the insurer provides your beneficiaries with a tax-free payout upon your death.
 
The truth, though, is that if your life changes in a significant way, your coverage may no longer be appropriate, especially if you bought your policy years ago. Below are a few questions to ask about your life and your objectives. If you answer yes to any of these questions, it may be time to sit down with a financial professional.

Has the number of people in your household changed?
 
Are you the main financial provider in your household? Did you purchase life insurance to protect your family in case you pass away? That’s a common reason for purchasing life insurance. If you pass away, your spouse, children and other dependents could face a wide range of financial challenges, including debt and loss of income. They may have to put off major life goals such as college or retirement.
 
Your life insurance coverage should change as your number of dependents changes. If you have additional children, you likely need more protection. Similarly, if your kids grow up and move out of your house, you may not need as much coverage.
 
Marriage and divorce can also impact your need for life insurance. If you get married, you may need to review your coverage, especially with regard to your beneficiary designations. If your spouse isn’t named as a beneficiary, he or she will not receive the death benefit. People often get divorced and remarried but forget to change their beneficiary designation. The risk is that your former spouse could end up receiving the life insurance proceeds.

Have you purchased a home, business or other sizable asset? Did you take out a loan to do so?
 
A major purchase is another event that may trigger a life insurance review, especially if you took out a loan to make the purchase. The classic example is a new home. Assume you purchase a home and take on a significant, long-term mortgage. Many lenders require a borrower to also carry life insurance to cover the balance. Even if the lender doesn’t require insurance, however, it may be a wise idea. The insurance proceeds could help your spouse or children cover the balance if you pass away.
 
You also may want to consider life insurance if you take out a loan for any other major purchase. Think about whether your dependents could cover the loan payments without your income. Also consider whether they could easily sell the asset to pay down the loan. If the answer to both of these questions is no, then more life insurance may be a smart strategy.

Have you made a career change?
 
Have you changed employers, started a business or maybe even received a promotion? If so, now may be the time to review your life insurance. Many workers rely on employer life insurance benefits for coverage. If you changed jobs, however, it’s possible that your new employer doesn’t offer the same level of protection.
 
Your new role may have also come with a raise. If you’re earning more money, your family stands to lose a greater amount of income when you pass away. That means they may need more insurance coverage to fill the gap. Additional protection may be necessary. The only way to truly know whether you have an appropriate amount is by conducting a detailed needs analysis with your financial professional.
 
Is it time to review your life insurance strategy? Contact us today at Senior Care Alliance. We can help you analyze your needs and adjust your plan. Let’s connect soon and start the conversation.
 

Licensed Insurance Professional. This information is designed to provide a general overview with regard to the subject matter covered and is not state specific. The authors, publisher and host are not providing legal, accounting or specific advice for your situation. By providing your information, you give consent to be contacted about the possible sale of an insurance or annuity product. This information has been provided by a Licensed Insurance Professional and does not necessarily represent the views of the presenting insurance professional. The statements and opinions expressed are those of the author and are subject to change at any time. All information is believed to be from reliable sources; however, presenting insurance professional makes no representation as to its completeness or accuracy. This material has been prepared for informational and educational purposes only. It is not intended to provide, and should not be relied upon for, accounting, legal, tax or investment advice. This information has been provided by a Licensed Insurance Professional and is not sponsored or endorsed by the Social Security Administration or any government agency.
17962 – 2018/9/4

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Do Retirees Need Life Insurance?

9/10/2018

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Are you in the final years of your career? Or did you recently retire? If so, you may be in the process of evaluating your financial strategy and making adjustments. You may be analyzing your investment strategy or developing a retirement budget. Perhaps you’re deciding when to file for Social Security benefits. This is likely a busy but exciting time.
 
This also may be a great time to review your life insurance. You may have acquired a variety of life insurance policies over the years. Many people purchase life insurance to protect their spouse, kids and other loved ones in the event of their death.
 
Many retirees feel that they don’t need life insurance coverage. Some even cancel their policies. However, there may be good reason to keep your life insurance or even increase your coverage. Below are two common reasons why retirees ditch their life insurance and why these reasons may not be correct. If these ideas sound familiar, you may want to reconsider.

Myth No. 1: I don’t need life insurance if my kids are grown and financially independent.
 
The most common motivation to buy life insurance is to protect young children. If that was the reason you bought insurance, you may feel like you no longer need that coverage once your children are grown. If you’re an empty nester with significant assets and little debt, life insurance may seem unnecessary.
 
Don’t cancel those policies just yet, though. Life insurance can serve a variety of purposes, and it can be a helpful resource in retirement. That’s especially true if your policy has accumulated cash value. You can use that cash value as an emergency reserve or supplemental income source. You may even be able to take tax-efficient loans or withdrawals from the policy in retirement.
 
You can also redirect the purpose of the death benefit. Just because it was originally intended to protect your young children doesn’t mean it has to stay that way. Consider using the policy to fund college for your grandchildren or to leave a charitable legacy.

Myth No. 2: My spouse will have plenty of assets after I pass away.
 
Many retirees enter retirement with more assets than they’ve ever had in their life. After all, you’ve probably been saving for retirement for decades. Surely those assets will be sufficient for both you and your spouse. If you have plenty of retirement assets, you might think there’s no need for life insurance.
 
Remember, though, that retirement can span several decades. It’s possible that your assets may not last as long as you expect. You may spend more than you’d planned, or the financial markets could take a downturn. You may face significant medical and long-term care costs in the final years of your life, and those costs could deplete your assets.
 
Life insurance gives your spouse a boost in assets upon your death. He or she can use that money to fund living expenses, provide gifts to family or pay for his or her own long-term care. If you pass away relatively early in retirement, your spouse may need to support himself or herself for many more years. Life insurance could help your spouse overcome that challenge.
 
Ready to review your life insurance as you head into retirement? Contact us at Senior Care Alliance for more information. We can help you analyze your policies and your needs and develop a strategy. Let’s connect soon and start the conversation.
 
Licensed Insurance Professional. This information is designed to provide a general overview with regard to the subject matter covered and is not state specific. The authors, publisher and host are not providing legal, accounting or specific advice for your situation. By providing your information, you give consent to be contacted about the possible sale of an insurance or annuity product. This information has been provided by a Licensed Insurance Professional and does not necessarily represent the views of the presenting insurance professional. The statements and opinions expressed are those of the author and are subject to change at any time. All information is believed to be from reliable sources; however, presenting insurance professional makes no representation as to its completeness or accuracy. This material has been prepared for informational and educational purposes only. It is not intended to provide, and should not be relied upon for, accounting, legal, tax or investment advice. This information has been provided by a Licensed Insurance Professional and is not sponsored or endorsed by the Social Security Administration or any government agency.
17965 – 2018/9/4
 

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Janet Pack
President & Founder
Senior Retirement Advisors, Inc.
4301 S Pine St Suite 628
Tacoma, WA 98409
253.565.0421
[email protected]

Licensed Insurance Professional.

All written content on this site is for information purposes only. Opinions expressed herein are solely those of Advisors Asset Management, Inc. and our editorial staff. Material presented is believed to be from reliable sources; however, we make no representations as to its accuracy or completeness. All information and ideas should be discussed in detail with your individual adviser prior to implementation. Advisory services are offered by Advisors Asset Management, Inc. Insurance products and services are offered through
Senior Retirement Advisors. Advisors Asset Management, Inc. and Senior Retirement Advisors are affiliated companies.

Advisors Asset Management, Inc. is a registered investment adviser in the State of Washington. The adviser may not transact business in states where it is not appropriately registered, excluded or exempted from registration. Individualized responses to persons that involve either the effecting of transaction in securities, or the rendering of personalized investment advice for compensation, will not be made without registration or exemption. The presence of this web site shall in no way be construed or interpreted as a solicitation to sell or offer to sell investment advisory services to any residents of any State other than the State of Washington or where otherwise legally permitted. Content should not be viewed as an offer to buy or sell any of the securities mentioned or as legal or tax advice. You should always consult an attorney or tax professional regarding your specific legal or tax situation. Advisors Asset Management, Inc. is not engaged in the practice of law.

Advisors Asset Management, Inc., Senior Retirement Advisors and Janet Pack are not affiliated with or endorsed by the Social Security Administration or any government agency.