Life Insurance Tips for Seniors

5 Ways Life Insurance Settlements Can Improve Your Life Today

If you’re a senior that owns a life insurance policy that is no longer needed, it’s probably costing you money that could be spent on improving the quality of your life now. If the primary reason you bought a policy no longer exists, you can sell it in an ever-growing secondary market. Sometimes policy holders receive very substantial offers for a policy they no longer need.

Here are five ways to benefit from a life insurance settlement.

ONE. Convert the hidden value in unwanted or unnecessary life insurance coverage into a substantial cash lump sum. Since cash is king in most portfolios, if coverage was purchased for reasons that no longer exist, liquefy the asset by selling it to an investor. In some cases, amounts that far exceed the cash surrender value of a policy can be earned from this type of settlement.

TWO. Because life insurance policies can be liquefiable assets, consider using the after-tax portion of a settlement to put money in your pocket. Then purchase new coverage with the advantage of lower premiums. An arrangement like this could help ease the burden of exorbitant obligations.

THREE. Use proceeds from a life insurance settlement to fund higher yielding or faster growing investments. You might purchase ownership or control of a business enterprise; or consider tax exempt bonds. But wherever your investing sensibilities lie, quit spending money on a policy that you cannot use. Sell it.

FOUR. Use proceeds from the sale of your policy as a donation to family or to a non-profit organization of your choice. Many non-profit organizations are committed to rebuilding, preserving and doing anything they can to help communities in need. This makes them an attractive beneficiary to many. But instead of naming a non-profit as the new beneficiary on your policy, sell it. In some situations, a profitable settlement could provide significantly more money for the charity.

FIVE. Use proceeds from a settlement to invest in you or someone you know. Paying for health care or education can be a tremendous value. Health and education are two things everyone needs. While this type of investment cannot be converted back to cash, it can pay dividends in other meaningful ways. It can improve the quality of life now and it has the potential of building a better tomorrow.

So if you are a senior citizen whose policy has become too expensive to maintain or it is no longer needed, consider selling it to an investor. A savvy investor will analyze the policy and make you an offer. Some offers will far outweigh the alternatives. You have two other options: 1. Let the policy lapse by discontinuing payments; 2. Give the policy back to the provider for the cash surrender value. Both of these options pale in comparison to what some investors are willing to pay.