If your children are grown and your mortgage is paid off, do you still need life insurance?
It depends on your situation, but many people find that a cash-value life insurance policy, such as whole life or universal life, can help supplement their retirement income.
Basically, you can get at your life insurance’s cash value in three ways:
First, you can typically withdraw part of the cash value of your life insurance without losing coverage.
You generally won’t incur income taxes on these withdrawals, up to the amount you’ve put into the policy.
As an alternative, you could take out a policy loan.
The loan itself isn’t usually taxable, but any unpaid amount may be.
And, as is the case with a withdrawal, a loan can reduce your policy’s death benefit.
Finally, you could simply cash out, or surrender, your policy.
Before tapping into your policy, think carefully about what the reduction or elimination of the death benefit might mean for your loved ones.
If they don’t really need the money, the added income could help you in retirement – but you’ll want to be sure about your decision.
Edward Jones is a licensed insurance producer in all states and Washington, D.C., through Edward D. Jones & Co., L.P., and in California, New Mexico, and Massachusetts through Edward Jones Insurance Agency of California, L.L.C., Edward Jones Insurance Agency of New Mexico, L.L.C., and Edward Jones Insurance Agency of Massachusetts, L.L.C. California Insurance License OC24309.
This article was written by Edward Jones for use by your local Edward Jones Financial Advisor John Dickerson. Member SIPC.
