What To Consider If You're Considering Term Life Insurance

By Shane Flait

Although you're close to retirement, you may still need life insurance if you've got people counting on your income. Buying term insurance is the cheapest way to go. Here are some points to keep in mind...

If you can foresee some point in your future where you won't need life insurance, then buying term insurance rather than a cash value (whole life) policy may be the way to go. Your kids finally able to move out, finishing college, or getting stabilized in a career may be that point. And cash value policies generally have high commissions associated with them.

-Choosing to go with term insurance means answering three questions:

* How much term insurance should I buy?

* How long should the term be?

* What if I have to renew it?

-How much to buy?

Considering that you see a foreseeable end to someone's need for your income - or at least you're ability to help him out, you need only determine just how much would fulfill that need were you to die. This could be clearing up some debt, a few years of college costs, or more.

-How long should the term be?

Alas, as you get older your risk of dying increases. And the older you get, that risk increases faster. So if you're anywhere near retirement, your premiums will be considerably higher than if you're in your 40s.

But fortunately, you can buy term insurance so your premium adjusts - and that means increases - annually, or every 5, 10, 15 or 20 years. The less frequently it's adjusted, the higher the premium will be to take into account the more aging that takes place between adjustments.

Locking in a longer term means you know how much you'll have to pay. But you'll be paying more in the earlier years than if you buy a policy that adjusts more frequently. And if your need for the insurance during that longer term reduces or disappears, ending it early will mean you paid higher premiums than necessary.

-What about renewing it?

Always choose a term policy that guarantees it cannot be cancelled because of poor health. And make sure the premiums paid each time you renew are guaranteed and outlined term-by-term in your policy.

So choose a term that should reasonably cover the time of possible need. And remember that the relevant cost to you is the overall amount you'll pay for your coverage for all the years you actually require life insurance. Be sure the premiums paid each time you renew are guaranteed and outlined term-by-term in your policy.

Remember that the purchase of life insurance involves costs, fees, expenses and potential surrender charges and depends on the health of the applicant. Not all applicants are insurable.

Shane Flait helps you with your financial legal, tax, and retirement goals.
Get his FREE report on Managing Your Retirement =>
http://www.easyretirementknowhow.com/FreeReportandSignUp.htm
Read his ebook: 'Wise Way to Financial Independence' =>
http://www.easyretirementknowhow.com/WiseWayGate.htm

Article Source: http://EzineArticles.com/?expert=Shane_Flait