Do I need life insurance once I retire?

Getting older means you can finally start to enjoy your life’s work. But just because you’ve hung up your employment boots, life can still throw some unexpected curveballs at your retirement goals, so it’s worth being prepared.

Am I still eligible for life insurance when I retire?

Yes, you can take out life insurance as long as you meet the age requirements set by the insurer. Most policies allow you to apply all the way up to age 65. Generally, this means you can still apply for cover after leaving the workforce or withdrawing your super, so there’s plenty of time to start looking out for the people you’ve worked hard to provide for (including yourself).

What can life insurance do for my retirement?

Life is still full of surprises after you retire. That’s good news if you’re the adventurous type but it’s worth having a Plan B in case you pass away or your physical health doesn’t hold up. Keep in mind that you’ll no longer be earning a steady income during retirement so you’ll need to ration your super carefully – large financial setbacks like an injury or illness could interrupt your hard-earned plans to travel or enjoy a comfortable lifestyle after decades of working. Your surviving partner or spouse’s living situation could also change if you weren’t around to support them emotionally, physically, or financially.

It’s also worth thinking about any dependants that still rely on you. The recent pandemic saw an increase in “Boomerang Kids” (adults forced to move back in with their parents after losing their job), which could mean that financially independent children aren’t as independent as they seemed. If you’d like to be able to help your kids or grandkids during uncertain times, then life insurance could provide a good safety net for them if you were to suddenly pass away later in life.

Should I review my policy as I get closer to retirement?

It’s worth considering. People’s needs tend to change as they get older or stop working so your policy should generally reflect any new plans or financial circumstances. For example, your existing benefit amount might be too high or too low for your retirement goals. To avoid paying for cover you don’t need or being under-insured, your level of cover could reflect things like:

  • your age and health
  • your financial position, including debts, assets, mortgages, and how much superannuation you have
  • the number of dependants you’d like to consider (spouse, children, grandchildren, or even siblings)
  • any other insurance policies or payments that you and your family can rely on (inheritance, funeral insurance, or the Age Pension).

You can always reach out for a chat if you’d like to adjust or review your policy. Until then, enjoy your countdown to retirement!

Any financial product advice is general in nature only and does not take into account any person’s objectives, financial situation or needs. Before acting on it, the appropriateness of the advice for any person should be considered, having regard to those factors. Persons deciding whether to acquire or continue to hold life insurance issued by any life insurer should consider the relevant Product Disclosure Statement (PDS) and Target Market Determinations available on the relevant issuer’s website. This article is general and it is not a recommendation as to what may be suitable for you or what product or life insurer may be suitable.

Article prepared by TAL Life Limited ABN 70 050 109 450 AFSL 237 848

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