subject: Ways Life Insurance Can Help You Plan For Retirement [print this page] Life insurance is a great way to help a family financially cope with a loved ones death. However, life insurance can also help people plan a comfortable retirement. More and more people today are realizing the importance of life insurance as a retirement tool and they are beginning to incorporate it into their retirement plans.
Make life insurance a viable supplement to traditional retirement plans
The economic downturn has drastically affected our assets especially traditional means of financial stability such as home values, savings accounts and investments. If you incorporate life insurance both as a retirement tool as well as a life protection tool, it will offset the low values of your other assets. When you incorporate life insurance into your overall retirement plan it will effectively take your mind off the uncertainty of enjoying a comfortable retirement and take care of your dependants needs in the event of your death.
Two ways to use life insurance for a comfortable retirement
Incorporating life insurance into your retirement plan is quite simple. Here are two ways that you achieve this strategy that can be the difference between a comfortable retirement and an uncertain one.Ensure a comfortable retirement for your spouse. Protect your family if they face a situation where you die before you reach the age of retirement. Say you are using conventional plans to save for your retirement. If you were to die before you retire, the fruits of your conventional retirement plans would not have reached full maturity. Nor would your dependants have your salary to keep them living in the comfortable lifestyle they have been accustomed to. Those who die young dont have too much time to put together a viable financial plan.
Counter this situation by supplementing your conventional retirement plans with a sizeable term life insurance policy that can help pay for your familys expenses. It can also fund your surviving spouses retirement. Since life is uncertain one must always consider unexpected situations like these when planning out your finances.Supplement your own retirement income. Sometimes it so happens that your life turns out smoother than planned. The kids become financially independent in a shorter time than you had accounted for. If you already have a sizeable permanent life insurance and no real financial dependants, then you can borrow from it to fund your retirement. You could also consider surrendering the policy (since you no longer have dependants) and deriving your retirement income from the funds that have accumulated in the policys cash value account. This can be a very important way to fund everyday retirement expenses.These two means serve you differently. It is left to you to choose the right one. Ideally take out a term life policy to see you though the most financially risky years of your life, and a permanent life policy as well. If you live longer, you can cash out the permanent life policy.
These days there is a big noise about special retirement life insurance plans. You dont have to buy them. A simple term or permanent life policy, if used in the ways mentioned above is more than enough to take care of your needs.
Be prepared for life
Sound retirement planning can give you the confidence to face life head on. It will also give you peace of mind knowing that even if you may not live long enough to enjoy a retirement, your loved ones are protected.
by: Denise Mancini
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