By the time you retire, your accumulated wealth is probably at its height. The challenge now is to manage your assets so that they last as long as you do. Insurance still plays an important role at this stage of your life.
AUTO
Mature drivers are some of the safest on the road. They have fewer accidents and tend to drive safer cars.
HOME
Unlike auto insurance, where the state sets minimum coverage limits, the bank that holds your mortgage usually requires you to have homeowners insurance. Once you pay off your mortgage, it’s still important to have protection in case of fire, burglary, and natural disasters. Some retirees stay active by working part-time. If you work at home, you may need a supplemental liability policy that covers your work-related activity. Consider also an umbrella policy to protect your accumulated assets. Real estate, securities, and savings could be wiped out by one lawsuit. Umbrella coverage adds another layer of protection above what is provided in your standard homeowners and auto policies. Generally, it is relatively inexpensive, and provides an additional million dollars or more in liability insurance.
LIFE
Life insurance is cheaper the earlier in life it is purchased. Retirees can still get life insurance, but should be prepared to pay much more for it.
HEALTH
Most people under 65 get group health insurance through their or their spouse’s job. Group health insurance costs less than individual health insurance. Most people who are 65 and older get Medicare from the federal government. Those on Medicare without group coverage to fill in health care gaps can buy a Medicare Supplemental or Medigap policy, regardless of health.
FINANCIAL PLANNING
Married retirees need to review their financial situation and determine how much income a surviving spouse would lose. Such income losses frequently result from reductions in Social Security payments. The investment strategy for seniors should emphasize income-producing and liquid instruments that can supplement retirement income and Social Security.
