How Much Life Insurance Do I Need in My 60s?
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By the time you’ve reached your 60s, if you don’t already have life insurance, you might wonder whether it’s worthwhile at this stage. Deciding whether life insurance is right for you is a personal decision that you should make based on your financial situation, among other factors. For many, there are enough compelling reasons and uses for life insurance to make the purchase worth it, even in your 60s.
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How much life insurance do I need in my 60s, and why?
If you need life insurance, it’s crucial to deliberate and carefully decide the appropriate amount of life insurance based on your life and circumstances. Financial professionals tend to recommend this rule of thumb – purchase a life insurance policy that provides between 10 and 15 times your annual income.
This is good advice and a good starting point. However, the amount of life insurance you purchase should depend on factors including:
- Your current financial situation. The first thing you should consider is your current financial situation. This will help you determine your budget for life insurance. Considering your financial situation will also help prepare you for the next step.
- The purpose of your life insurance. It’s one thing to say that you should purchase life insurance, but it’s another to understand the “why” behind your life insurance. Think about what you want your life insurance to be used for. Some common examples include providing financial security for your spouse and beneficiaries if you pass away, paying off your mortgage and/or other outstanding debts that might be left to your family after your passing, providing an inheritance for your children, covering major future expenses for your children and grandchildren, including weddings and education expenses or donating money to a charity, alma mater, or another institution that is near and dear to you.
Once you have started to think about these factors, you can look at the types of life insurance to see which is best for you.
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Types of life insurance
Term life insurance
Term life insurance is a policy that expires after a set number of years, known as the term. It’s popular for many people looking for life insurance because it is typically the most affordable life insurance product. Terms are usually available in 10, 15, 20, 25, and 30 year term. However, as a 60-year-old, you should know that you may not qualify for the longer-term policies. Each life insurance provider sets its requirements.
If you opt for a term life insurance plan, you should have several options once the term ends. Some life insurance providers allow you to renew the term life insurance policy annually. If you do this, your insurance premium will likely change each year when you renew. Another option is converting the term life insurance policy to a permanent one when the term expires.
Permanent life insurance
Permanent life insurance (also known as whole life insurance policies) will last for the rest of your life. That is, of course, as long as you keep your policy in good standing by paying your insurance premiums on time.
These policies tend to be more expensive than term life insurance policies, but they also come with some additional benefits. The most obvious benefit is that you’ll never have to worry about your term expiring and arranging a way to continue your life insurance coverage. Another benefit is that these policies come with a cash value component.
Each time you pay your insurance premium, a portion of your payment will go toward your policy's cash value. Over time, the cash value will build up, and then you can use it differently. You can use your policy's cash value to make your insurance premium payments. You can also borrow against the cash value of your policy to give yourself a loan when you need it.
Final expense insurance
A less commonly known type of life insurance is final expense insurance. These policies are specifically designed for one purpose – to ensure that you have funds set aside to pay for your final expenses. Like other policy types, you can set the death benefit amount you want for the policy. Then your family members will be able to use this money for final expenses including your funeral costs, burial costs, or cremation costs. The funds can also be used to cover other final expenses, including unpaid out-of-pocket medical bills and probate costs.
Why get life insurance in your 60s?
If you are still wondering why you should buy life insurance in your 60s, here are a few reasons to consider.
- Financial stability for your loved ones. Having a life insurance policy set up ensures that your family will have the financial stability they need after you’re gone.
- Debt coverage. In addition to covering day-to-day expenses for your family, the death benefit of your policy can be used to pay off leftover debts. This can include credit card debt, mortgages, and other types of debt that might otherwise be transferred to your loved ones.
- Legacy preservation. What legacy do you want to leave behind? Whether it’s setting up a cushy inheritance for your family or making a large donation to an important cause, life insurance can help you achieve those goals.
Up to $2 million in coverage
- Get covered in 5 minutes.
- 95% of customers approved.
- No Hassles. No Gimmicks. Easy Application.
- Non-Commissioned Agents.
- Ages 20+
- 100% Online Application.
- Fast Coverage.
Best life insurance companies for 60-somethings
Once you’ve narrowed down the type of life insurance you’re most interested in, it’s time to compare life insurance companies. Here are some of the best companies to get a policy for life insurance for seniors.
Prudential Financial
Prudential Financial is a good option for 60-somethings because it offers a wide range of life insurance products. This life insurance provider offers affordable and permanent term life insurance policies, including whole and universal life insurance. Each policy is different, but there are a few features you can expect to find from one or more of them. This includes flexible premium payments and customizable coverage to meet your needs best.
There are a few riders available that can make policies from Prudential Financial even more desirable. This includes living benefits. Living benefits are a unique feature that allows you to benefit from your life insurance policy directly while you’re still alive. You can opt for coverage that can provide you with access to money to help cover medical bills due to terminal illnesses or some chronic health conditions.
Another key factor to consider when choosing a life insurance provider is its reputation for customer service. Prudential Financial has a team of representatives committed to providing high customer service from start to finish. Whether you need help choosing the right policy or have questions about the application process, there’s a representative who is ready to provide some guidance.
New York Life Insurance Company
New York Life Insurance Company is one of the oldest insurance providers in the country. Throughout history, the company has built up a strong reputation for its financial strength and stability, making it an attractive option for anyone seeking a life insurance policy.
You’ll find several life insurance options from this provider. This includes the most common types of policies, such as term life insurance and whole life insurance. It also provides long-term care insurance and individual disability insurance. Long-term care insurance is a unique product that can help you pay for in-home or facility care, usually not covered by standard health insurance such as Medicare. Individual disability insurance can provide coverage that you can use if you’re out of work for an extended time due to illness or injury.
Within each type of life insurance policy, there are several customizable policies and features to choose from. For example, if you’re interested in individual disability insurance, choose between three pre-designed packages or build a custom package. There are also riders available with most policies.
New York Life Insurance Company is available in most states – not just New York. If you pursue life insurance from this provider, you’ll be connected to a local agent for a no-obligation conversation. You can meet with your agent in person or virtually to learn more about the available policies. Then, if you decide to purchase a policy, you can stay in touch with your agent to ask questions and be sure you’re getting the most out of your policy.
Lincoln Financial Group
Lincoln Financial Group offers both term and permanent life insurance policies with customizable coverage to meet your needs. A unique feature of this insurance provider is that many of its policies are available to foreign national clients. So, if you’re from another country but spend most of your time in the United States, you’ll still be able to benefit from these policies.
Several features come with policies from this provider. One of the features highlighted by the company is that all of its products have a streamlined design. The policies are straightforward and fees are clearly defined, as is the fine print of each policy. In some cases, you may be able to qualify for coverage without a medical exam. This can greatly reduce the waiting period for your policy and allow you to rest assured with coverage in a matter of minutes instead of waiting weeks or months.
The investment-focused products from Lincoln Financial are a great option if you’re looking for a policy to maximize life insurance's living benefits. For example, the Lincoln LifeGoals policy allows you to access your policy's cash value or anytime. There are no waiting periods, nor are there penalties or withdrawal fees if you borrow from the policy’s cash value.
When you work with Lincoln Financial Group, you ’ll have access to a financial professional who can help you identify your goals and find the product that is the best fit for your family. You’ll be connected with a financial professional based on your top priorities for your coverage. The financial professionals are not directly affiliated with Lincoln Financial Group, and you can contact a professional to talk about a comprehensive financial plan in addition to choosing life insurance coverage.
Pros and cons of buying life insurance in the 60s
Buying life insurance in your 60s comes with its own set of pros and cons:
Pros
- Financial protection. Life insurance provides financial protection for your loved ones in the event of your death, ensuring they can maintain their standard of living and cover expenses such as mortgage payments, debts, and daily living expenses.
- Estate planning. Life insurance can be used for estate planning, providing liquidity to cover estate taxes and other expenses without liquidating assets.
- Legacy planning. It allows you to leave a legacy for your beneficiaries, whether providing for your spouse, children, or charitable organizations.
- Final expenses. Life insurance can cover funeral and burial expenses, relieving your family from the burden of these costs during a difficult time.
Cons
- Cost. Life insurance rates tend to be higher for individuals in their 60s compared to younger age groups due to increased risk factors associated with age.
- Limited options. As you age, the range of life insurance options available may decrease, and you may only qualify for limited coverage options such as term life insurance with shorter terms or permanent life insurance with higher premiums.
- Health factors. Health issues become more prevalent as you age, and insurers may require medical underwriting or charge higher premiums based on your health status.
Up to $2 million in coverage
- Get covered in 5 minutes.
- 95% of customers approved.
- No Hassles. No Gimmicks. Easy Application.
- Non-Commissioned Agents.
- Ages 20+
- 100% Online Application.
- Fast Coverage.
The bottom line
It’s never too late to reevaluate your financial goals. That’s why life insurance can still be a worthwhile purchase when you’re in your 60s. Plenty of life insurance products are suitable for this age group. All it takes is a bit of careful consideration to get started.
Fortunately, most life insurance providers offer flexible and customizable coverage that you can use to fit your financial plan and goals fully. There are also financial professionals on hand who can help you narrow down your options and find the best policy for you and your family.
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Ashley Hart is a lead copywriter and digital marketing expert covering finance, law, real estate, music, entertainment, health and wellness.
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