What to Look for in Life Insurance Over 50

Life insurance for people over 50

If you are or are close to age 50, you may think you don’t need to worry with life insurance. Or maybe you are interested in more coverage but aren’t sure what the best option would be? The need for updating your life insurance as you age is more important than you might think.

Pensions are harder to come by in the workplace, and healthcare costs are rising. This is largely because the average life expectancy in the US is now almost 79 years old.

Simply put, your life insurance needs and prices change as you age. So, what factors should you consider?

In this article:

Duration of policy for people over 50

At or around age 50, the duration of the life insurance you are considering is one of the key factors, along with age, that determine the premium. The distinct types of life insurance products deal with the changing circumstances of duration and age differently. Here's a run-down of these basic differences:

Term life insurance over 50

Healthy individuals up to age 70 can typically get a life insurance policy with a term as long as 20 years. At age 50, you may still qualify for an even longer policy term. However, the longer the term, the pricier your premium could be as you age.

For people with term life insurance policies at age 50, there is still the risk that you could outlive your policy. However, premium payments are typically lower for this type of policy. Think about your circumstances and budget when considering the benefits term life insurance offers at this stage of life.

Whole life insurance Over 50

In some cases, a whole life policy that accrues cash value might make more sense. The policy could deliver the benefits to your loved ones. Or the cash value could serve as additional income for you at a later date.

Using the cash value that the policy accrues will cause the life insurance benefit to be reduced. Take that into consideration when purchasing.

Life insurance over 50: Peace of mind vs cost

Generally, the older you get, the more life insurance premiums cost. But does the peace of mind you can get from extra coverage outweigh the expenses? If you have loved ones depending on your income, knowing that they are financially secure in the event of your death can be a big weight off your shoulders.

 In addition, permanent life insurance policies help offer some financial security while you are still alive. The cash value accrued from a whole life insurance policy could help you if your retirement fund is not as much as you needed or if you have unexpected costs arise. Buying this type of policy can provide you a tax advantage, too.

Permanent life insurance over 50

Permanent life insurance policies may often be thought of as a safe way to save. As you age, you have less time to recover from an investment loss. Permanent life insurance may be a good strategy because the cash value in these policies can help diversify your portfolio.

Even if something happened to other investments, you would have the cash value from your life insurance policy to fall back on. Remember, falling back on your cash value or using it for any expenses will reduce the policy’s benefit.

Life insurance over 50: Coverage needs

Life insurance can help give financially dependent loved ones security in the event of your death. Perhaps you already have a life insurance policy? Review your current coverage regularly, especially as you grow older.

Check your life insurance coverage needs and see if an additional final expense insurance policy should be taken out to help cover final costs and bills. Over time, your financial responsibilities and goals are likely to shift. Therefore, it's important to ensure that your coverage aligns with your current circumstances.

For most people over 50, life insurance is still useful in many cases. But it becomes increasingly important with each year that passes that you understand your specific needs For instance, if you’re still working and have income that others rely on, life insurance can replace that income if something were to happen to you.

Retirement and life insurance for people over 50

Alternatively, if you’re approaching or in retirement, consider whether your savings are sufficient to cover your spouse’s living expenses. These include final costs like funeral expenses, medical bills, and outstanding debts.

Additionally, life insurance can play a vital role in estate planning. This can help you leave a legacy for your loved ones or a charity of your choice. It also ensures you pass on your assets smoothly.