Whole life insurance covers the policyholder for a lifetime. Plus, it can accumulate cash value, providing a tax-deferred source of wealth. These advantages often make it a great choice for seniors with coverage needs who want their beneficiaries to have added financial security. This article will explore some of the benefits of whole life insurance for seniors and why they should consider getting a policy this summer.

1. Seniors can leave a legacy for their heirs

Whole life insurance can be an excellent financial planning tool. The death benefit of whole life insurance is not taxable when the policyholder dies. The policyholder's beneficiaries receive the total amount tax-free since the death benefit is generally not considered taxable income.

Instead of passing down the cash itself, seniors can use that cash to buy a whole life insurance policy, maximizing the legacy they leave their heirs while minimizing how much the government takes.

2. Seniors can build wealth through cash value

Whole life insurance has a cash value growth component. Part of each premium goes into this component, which then grows tax-deferred at a fixed, guaranteed interest rate. Once the cash value grows large enough, seniors can borrow against it or withdraw from it. Cash value loans don't often have due dates or require credit checks, and they aren't taxable. Plus, policy loans generally come with lower interest rates. 

Seniors could use these low-interest loans in various ways, keeping in mind that any amount that is not repaid will reduce the policy's death benefit. If a senior chooses to surrender their policy, they receive the cash value minus any surrender charges. So, even if they cancel their coverage, they may recoup some of the premiums they've paid.

3. Whole life policies provide coverage for a lifetime

Whole life insurance covers the policyholder for a lifetime. This means they don't have to worry about outliving the policy and not getting their premiums back.

4. Whole life insurance can help handle any remaining debts

When someone passes away, their debts will generally move to their estate. That means their heirs will have to use some of the estate's assets to cover the debts, reducing the wealth available to the heirs. By getting a whole life insurance policy, seniors can make sure their heirs have a significant source of funds to pay off any remaining debts and keep more of their estate for productive purposes.

Consider whole life insurance this summer

Whole life insurance can come in handy for many seniors, thanks to its guaranteed lifelong coverage and cash value component. It offers seniors a way to build more wealth and leave a larger legacy for their heirs, helping to create financial security and stability for them.

Seniors may face higher premiums for whole life insurance, but these benefits are worth it for many. That said, seniors should gather multiple quotes from several insurers to find the best rates on the coverage they need. 

For all media inquiries, contact: 

Laura Zimmerman, Chief Marketing Officer

laura.zimmerman@fidelitylife.com, (312) 288-0068