When you think of retirement planning, life insurance isn't always at the forefront. And in many ways, getting life insurance when you're older and headed into retirement may not seem to be the most sensible use of your retirement income. However, life insurance needs are different for everyone. And in many financial situations, senior life insurance can be that additional layer of protection that you and your spouse may need - well into your golden years. So before you decide to cancel your life insurance, let it lapse or expire, you may want to consider the following reasons for keeping life insurance as you get older and move into retirement.
Because you have dependents
The ability to replace your income as the primary wage-earner for those who depend on you for financial support is the primary purpose of having life insurance. So while you may not be raising young children, you may have a spouse, special-needs adult child, a sibling or even aging parents who rely on you financially.
Because you have debt
Do you still have a few years left on your mortgage? Are you paying down student loans, car loans or other consumer debt? If you're a senior and still working so that you can continue to chip away at lingering debts, then you might want to consider life insurance coverage - at least until you have the bulk of your debts paid off. Otherwise, you'll be leaving that debt behind for your significant other.
Because your estate is subject to taxation
If you anticipate your estate being hit with a big tax bill after you're gone, don't pay taxes late, but start to consider a life insurance policy. A life insurance policy can provide the immediate funds your family will need to settle your tax bill. Without the money in hand, your loved ones will have to come up with the cash on their own. This could mean selling real estate, personal property and family valuables, a business, or even siphoning off a chunk of their inheritance cash in order to pay estate taxes.
Because you want to leave a legacy
Do you have a favorite charity or organization that you would like to continue to support after you die? A life insurance policy can be the ideal way to give back, while leaving a financial legacy.