Do I still need my Whole Life Insurance when I retire, or should I get one and why?

## The Benefits of Whole Life Insurance in Retirement: 7 Key Reasons to Consider

We often hear this from clients. The scenario is that you're approaching retirement or have recently retired, your children are grown, and you have a whole life insurance policy you bought years ago. You begin to question why you're still paying for it.

Alternatively, you might hear about the benefits of a well-designed permanent whole life policy and wonder if you should consider getting one now that you're retired.

The answer to both questions is a definite yes. Why?

Here are 7 reasons for you:

1) A well-structured whole life policy from a mutual insurance company (one that distributes dividends to policyholders) provides stability to your overall investment portfolio, including stocks, 401ks, and IRAs.

Your life insurance isn't linked to the market, and the cash value increases annually within the policy, regardless of economic or market conditions.

2) If you have a sizable estate, life insurance can balance it out since the payouts are tax-free, preventing your family from having to sell assets to cover state or federal estate taxes after your passing.

3) The cash value within your whole life policy can be a valuable tool for tax planning, allowing you to perform Roth Conversions early in retirement before Social Security begins. Consider the cash in these policies as a tax regulator to manage your taxes annually. Tax tools are only effective with a well designed financial plan and how to they will be used.

4) If you receive a pension from your employer and have a whole life policy, you can opt for the maximum pension payout instead of 50% for a joint benefit with your spouse. This enables you to enjoy higher retirement payouts, knowing your surviving spouse and family will be supported by the death benefit of your whole life policy.

5) Legacy planning becomes simpler with life insurance, ensuring your family retains more of your assets upon your passing, as all life insurance proceeds are tax-free.

6) For married couples collecting Social Security, it's often overlooked that upon one partner's passing, household income is halved since the surviving spouse can only receive the higher of the two Social Security payments. Life insurance helps bridge the gap when this occurs.

7) Some companies, including those BlackFin Wealth collaborates with, offer chronic illness riders. These are beneficial if you become disabled, as they ensure the policy remains active even if you're unable to make payments.

Bonus: I have clients who might not be alive today, if they didn't have a cash-accumulating whole life insurance policy. Life often disrupts our plans, and if you're diagnosed with what seems to be an incurable disease, cutting-edge research and medicine can be extremely costly. Without access to substantial liquidity or cash, affording this latest treatment might be impossible.

Without access to substantial liquidity or cash, affording this latest treatment might be impossible. Having a whole life insurance policy allows you to access a significant payout from your death benefit when a doctor gives you little hope for a long life. This substantial sum from your death benefit could be the difference between life and death.

Hopefully, the ideas above have provided some insight into how a well-designed whole life insurance policy can be very beneficial even during retirement.

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