Retirement is an exciting age for almost all people. The freedom to do what you want, when you want is exhilarating and relaxing. You can finally visit Hawaii or China or Madagascar! However, you should make sure your financial ducks are in a row before jetting off. Particularly, you should make sure that your life insurance is able to keep up with your changing lifestyle.
Here are a couple of things to consider when deciding if your life insurance needs to be adjusted after retirement.
Obviously a large factor in your life insurance rates and policy will be what kind of lifestyle you’d like to enjoy. If you’ve been living a rather safe life as an accountant up until retirement, you can expect your policy to need adjustment if you’re going to make a habit of skydiving and paragliding after retirement.
This might mean that you change your policy from term insurance to whole-life if you haven’t already if you’d like to make sure you have the ability to borrow against your policy. After all, this could foreseeably be the policy you’re going to have for the rest of your life. Just be advised of the fees associated with canceling such a policy- if you think you might want to be more flexible, stick to term insurance.
Many people choose to change locations after retirement and not just temporarily. If you’ve always dreamed of becoming an expat living in Peru or Australia, you need to anticipate changing insurance policy carriers. While some companies and even policies will extend over international borders, you will most likely need to research the insurance laws and costs of your new home country.
The laws will also vary country to country. Make sure you’ve thought ahead and left a chunk of money available to you in your country of origin- in case you ever need to come back home.
Especially if you’re going to be moving abroad, you need to make sure that your assets and policy payouts can reach your beneficiaries over international borders. Consult a lawyer as well as your insurance agent in order to ensure a smooth transfer of property. Retirement might also be a good time to adjust who will be listed as a beneficiary on your policy. Often times we leave our assets to our children, but this might be the time of life that you consider leaving some assets directly to your grandchildren.
If you haven’t already, you should look into your family history to determine what kinds of medical conditions you’re at risk for. Has your lifestyle given you a predisposition toward a certain health issue? Do you already have health problems?
The answers to these questions not only affect your life insurance policy, but also the travel and activities you can undertake. You also might consider the location you want to live in for its proximity to specialists that deal with your health condition. If you have lung problems, maybe moving somewhere known for clean air will improve your quality of life. There’s a lot to consider.
Many things will change after you decide to retire. It’s important to make sure your life insurance policy reflects the kind of experiences you’d like to have.
Chris Jensen is an insurance adviser and writer with Australian life insurance providers, GIO.com.au. He is regrettably not yet retiring.