Thirty-three percent of Americans have no retirement savings or pension, according to the Federal Reserve. No wonder so many of us are nervous about our ability to retire.
Fortunately, there is an asset that many American seniors have at their fingertips that they can use to fund their retirements. Most of them don’t even realize it.
Darwin M. Bayston, a chartered financial analyst, and Daryn N. Teague, a public relations consultant who works with providers of legal and financial services, created this simple consumer guide to help people unlock the hidden value in their life insurance policies. Learn how to:
- find out the things that insurance companies don’t want you to know;
- improve your quality of life in retirement; eliminate what could be an unnecessary expense;
- and reduce stress by gaining peace of mind about retirement.
Some life insurance companies actually prohibit the agent who sold you a policy from telling you about the strategies revealed in this guide. Find out about all of the options at your disposal by learning about The Hidden Value in Your Life Insurance.
- This book succinctly provides good information that could be very useful, but is not widely disseminated. Most people don’t view their life insurance policy as an asset, especially a term policy. Yet, for many older people who have been paying for life insurance for many years, that policy can be converted to cash under the right conditions.
I first encountered this concept, or a related one, in the 1990s with products called Viatical Settlements. At that time, the AIDS epidemic was growing and resulting in death for so many. Viatical Settlements allowed many terminally ill young men to convert a life insurance policy to much needed cash. Fortunately, that need has receded as treatment for HIV has been successful.
Life Settlements provide a similar solution to many older people who have life insurance policies they don’t need or can no longer afford. In select cases, the policy can be marketed to a buyer who pays cash for all or a portion of the policy. Many redemption options exist including some that preserve part a death benefit for beneficiaries.
This book is easy to read, direct, and to the point. The author provides some history, financial context, and descriptions of how policies are valued, criteria for sales, and who buys them. Some may find the topic a bit morbid – basically, an investor will be waiting for the death of the insured. But this fills a need and presents a creative solution for some situations.
This is a must read for anyone that owns a life insurance policy. People need to understand that life insurance policies have more value than just paying out a death benefit. The scandal is that almost 90% of policies will either be lapsed or surrendered without ever paying a death benefit. This book does an excellent job of explaining in understandable terms how people can get the most value out of their life insurance policy and how to better plan for retirement and the expensive costs of long term care.
- Do what you can while you can! When viewing reality, life is never a sure thing. Whether a heart condition comes to fruition, or a drunk driver hits you, be prepared for the unexpected. The costs of funeral services are very high, make sure your loved ones don’t have to deal with this and their grief. Read on to see how you can help your loved ones to cope with this very difficult time.When shopping for life insurance, be sure to know the differences between the two main types: term life and permanent. Term life is a chosen amount of years that your benefactors are eligible to receive your insurance money. If you outlive these years, then the plan is void. Permanent life insurance stays with you until you die, but rates will generally be higher.Many people buy term life insurance when they’re younger because it’s cheap. Others are persuaded to buy whole life insurance, which, unlike term, has a cash value and can presumably be viewed as an investment. If you’re in good health, term is generally the best value. Try to lock in term insurance for the longest possible timespan you can find. When it runs out, if you’re still in good health, keep looking for term. Most of the time, whole life will be more expensive, but as you age, term life will also get quite expensive to cover the inevitable health issues that will crop up. Remember: term life as long as it makes sense ratewise, then switch to whole life.Purchase life insurance when you are young rather than when you are old. Putting off purchasing life insurance until later life to avoid paying premiums can end up costing you more. The earlier in life you purchase a life insurance policy, the lower your premiums will be and the less likely you are to be refused a policy.When considering purchasing life insurance, you must first understand your needs. You understand your financial situation better than anyone else, so do not let anyone convince you to purchase a policy you are not comfortable with purchasing. If you add your debt, estimated funeral costs, and 6-12 months of income replacement, then you can get an estimate of your insurance needs.Take advantage of the accelerated death benefit option if it’s offered by your insurance company. This life insurance benefit allows the policyholder to receive a substantial amount of the death benefit of the policy, in the case of a terminal illness. This can allow the insured to use this benefit to cover things such as medical costs, experimental treatments, a trip, home improvements or nursing staff.You need to find out exactly what is covered in a life insurance policy before you decide on a policy. Different policies provide different coverage options and have different terms. You need to find one that fits your specific needs. You can find out about your coverage options by talking to a life insurance agent.As stated in the beginning of this article, the costs of funeral services are very high and shouldn’t be left for the people closest to you to handle. Use the tips about life insurance to adopt the policy that best fits you and the people that are closest to you.