Retiring

How to Help Protect Your Loved Ones in Retirement

Americans approaching retirement may anticipate changes in income, but those changes don’t need to affect how they support their dependents.

If you’re worried about not being able to maintain your current lifestyle in retirement, you’re not alone. But looking beyond simply funding your own retirement lifestyle, a broader concern could loom: financially protecting family members who depend on you.

That concern might not be unfounded. “Your projected sources of retirement income, such as pension, 401(k) distributions and other investments may be enough to fund a comfortable lifestyle,” says Brenda Coggins, Senior National Life Sales Representative. “But what if they’re not set up to be passed on to the loved ones who rely on your income? If these funds were to end at your passing, your family could face a catastrophic loss of income.”

One key to retiring with peace of mind

The good news is that life insurance can be a safeguard against that threat and provide the peace of mind that comes from helping to financially protect your loved ones. But with the inflation rate at about 2 percent this year, it would be a mistake to assume that a life insurance plan you bought years ago will fully meet your future needs – or the insurance you have through your job will continue forever.1 With few exceptions, employer-provided coverage may end or dramatically change if you change jobs or retire.2

If you’re planning to retire within the next five to 10 years, says Coggins, it’s a good idea to speak with a life insurance specialist to review your current situation and projected needs. “The discussion should focus on a number of key questions,” she explains. “How do you envision your retirement? Are you primarily interested in spending time with family, traveling, starting a business, volunteering?” More to the point, if something were to happen to you and your retirement income suddenly stopped, what would it take to enable your surviving family members to meet their living expenses and cover unexpected emergencies?

These are questions most people don’t focus on – at least not sufficiently.

“That’s where a comprehensive insurance review comes in,” Coggins says. “Look at your projected retirement income, your fixed expenses, your credit card debt, and whether your mortgage will be paid off by the time you stop working.”

Coggins adds, “Factor in any other financial goals you want to protect – such as paying for a child or grandchild’s education.”

Regardless of how you envision your retirement, this exciting stage of your life should ideally focus on the things that matter most to you. And, having life insurance in retirement can help provide peace of mind in knowing you can help protect your loved ones even after you’re gone.

As you prepare to leave the workforce, you have a few things to consider. Make sure you’re ready for life’s third act.

1 Current US Inflation Rates: 2006-2017, US Inflation Calculator, 2017.

2 Pros and Cons of Group Life Insurance Through Work, NerdWallet, 2017.

ALIC37518 (exp. 12/19)

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