I am a 64 year old female widow with no life insurance. Yes, it’s embarassing, but true. Can any of you “experts” recommend the best option at this time in my life? If I call any companies, of course they will try to sell me their product. I don’t trust many people these days. Any advice is appreciated.
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Why do you need life insurance? In general, life insurance is for providing for those who are dependent on you if/when you pass.
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I got a life insurance policy when I was in my 20’s. It turns out that I never needed it.
You may not need life insurance.
Anyone with financial obligations who wants to protect others from financial hardship after their death should consider a life insurance policy. This includes individuals with dependents like children or spouses, those with debt such as a mortgage or co-signed loans, caregivers for disabled family members, and business owners who want to ensure business continuity. Life insurance provides funds to cover final expenses, replace lost income, pay off debts, and support loved ones.
To cover burial expenses and what few outstanding bills I may have. I would love to have that all covered when I die, but I don’t think that will be possible. I don’t want to shift that burden onto my children.
I feel as though I want/need life insurance for burial costs and what few outstanding bills I may have. I don’t want to leave the burden to my children. My question is term/whole life insurance?
Individuals who do not have financial dependents do not generally need life insurance.
Debts- For most individual, their debts will not be the responsibility of your heirs. The linked article goes over the few specific exceptions.
Funeral costs- life insurance is not a cost-effective way to pay for funeral expenses. The linked article reviews ways to reduce funeral costs.
https://clark.com/family-lifestyle/wills-funerals/funeral-planning/
You can prepay funeral and burial costs. My inlaws did that. You can purchase cemetery plots, often you can get a better deal from an individual who owns plots they do not want as compared with purchasing directly from the cemetery. If you are a veteran, you are entitled to be buried in a national cemetery at no cost. (The saying is that you have to pay the costs outside the gate (embalming, cremation, casket/urn, etc.), but all the costs inside the cemetery (grave site or columbarium space, grave lining (can’t recall the correct term), gravesite service, etc.)) are free.
If your estate will have sufficient funds to pay your bills and debts after you pass, then you really don’t need life insurance to pay that. If it won’t, then consider whether the assets of your estate could be garnished to pay the debt. In most cases, they can’t.
My Dad passed a decade ago, and I think I paid $1000 for direct cremation. We scattered his ashes in the San Francisco Bay. It was very moving.
Your children aren’t responsible for your debts, though you can bet that debt collectors will attempt to collect. Advise your children to assert their rights, tell them to not pay if requested.
I’m 64 and honestly I’m trying to figure out exactly when to CANCEL my term life policy, so I’m going in the exact opposite direction from you. I’m going to retire in 7 months, and once that happens the term life is no longer insuring my paycheck, so it just becomes a lotto ticket for my family. A very expensive lotto ticket, $101.25 per month. If I cancel at 65 instead of 68 when the 10 year term runs out, I save $3,645. That’s a lot of money for a service that won’t be needed any longer.
When an older person gets life insurance they pay a lot for the coverage… because guess what, old people tend to die, and the insurance companies know this. Especially bad are the small term policies (sometimes with no health questions or exams) which are often referred to as “burial insurance”. Those are the payday lending / pawnshop lending types of policies.
A woman aged 64 could live another 20 years, easily. Just put away $20 a month into high yield savings (let’s assume 3% over the next 20 years… impossible to say, but let’s assume) you end up with $5,482. That’s a pretty big dent into funeral expenses. Tell your kids it’s for funeral. And don’t spend it, except in a dire emergency. Or give the money to them to put away for you, that way you won’t spend it, and if they’re good people they won’t spend it if you tell them its for your funeral.
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You also might consider putting that money into an account for your burial or cremation. To cut costs when my Brother In Law died, I tried to buy a casket through Costco but could not in the state where he was. So I bought one out of Texas and it was air shipped to Virginia and a driver delivered it to the funeral home. My plan is cremation (probably ending up at the same crematorium in town where my two dogs went). All our ashes will be spread in the Pacific together. Pretty inexpensive. Clark would enjoy this. I ran the website for the glass-bottom boat that also is licensed for ash scatterings here. They told me that I get a free ride when I pass. I have in my will that even though they are saying they will do it for free, I have money set aside to pay them anyway, since with an ash scattering you get the whole boat for the event.
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My husband’s cremation was about $800, and his cremains are on a bookcase in my room. When I die, my cremains will be mixed with his, and my children will be able to choose whether to have us placed in the columbarium at my church, scattering them at a place meaningful to them (or they think to us), or a national cemetery (we are both veterans). I own several gravesites in Dallas that are available, but most of my family isn’t there anymore. I’d love to sell the gravesites, but there is no market. Or to give them to relatives, but no interest.
If you try to sell them again, perhaps an ad like “Become a Part Of Out Family, You can live at our place, right next door!. You can’t be evicted and can stay there forever, all for $1,000”.
My Dad was a Veteran and recipient of the Army ‘Soldiers Medal’. Unfortunately they had tightened entrence to National Cemetary by the time Dad died, so he ended up at Culpepper, which he would have loved more I’m sure.
I’ll add to the responses - you don’t need life insurance. The only time to buy it is when you’re young, healthy, and have dependents who rely on your income (spouse, children, aging parents, etc.). I also agree that if you really feel a deep need to have insurance, get some free quotes online, find out the monthly or yearly premium, and instead take that amount and put it in a savings or investment account. Besides, depending on the policy the premiums may increase as you get older. At age 85, for example, you may be paying many thousands of dollars a year for a $50K policy.
If you want the full funeral package with all the frills, try to save up $15-20K. A lot of people are skipping the expensive funerals of the past and choosing low-cost options.
I went with my mother a few years ago to the local funeral director. She wanted a casket (not cremation) and already has a plot. Even with the cheapest options (plain wood) the total cost will be around $8K. In comparison, my wife and I will do cremation, no cemetery plot, no fancy urn which will be about 90% less.
Costco caskets start at about $1300. If you cannot get one through Costco because of state regulations, just do a google search. Clark can tell you how to handle a funeral parlor. They have to break out prices for caskets separate from services. I told ours to give me the quote for caskets and for the funeral and said that ‘the family will decide on the casket’. Then we ordered a ‘mail order’ casket to be delivered to the parlor and took the inexpensive service.
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