When you marry, you buy life insurance, right? You buy it out of consideration for your spouse, and also so that in the event of untimely death, your household can be left with one income to shoulder expenses that may not be reduced.
These days, people are marrying later in life.
Take first marriages, for example. A recent study by the Pew Research Center says the median age for marriage in America is now 30 for men and 28 for women, compared to 23 and 21, respectively, in 1968. Today, 16% of us are waiting until our late forties (or later!) to marry.1,2
Maybe you are marrying after age 40, or thinking about it.
That might call for other insurance considerations besides having a life insurance policy. Whether you are marrying for the first, second, third or fourth time, your earnings and net worth are probably much greater than they were 10, 20 or 30 years ago, and you also may have some age-linked or business-linked insurance priorities.
These questions are worth discussing as you consider marriage. Are you and your spouse set to run a business or professional practice? Is there a significant pattern of dementia in your family or your spouse’s family history? How about a particular, severe illness? These questions may seem challenging to mull over as you approach the big day, but being pragmatic now is wise for the years ahead.
Some of us will live very long lives, and possibly need assisted living someday.
Marrying at mid-life or later means giving serious thought to life insurance and ways to ensure extended care. The Social Security Administration projects that today, the average 65-year-old male will probably live to age 83, and the average 65-year-old female will probably live to age 85. Advances in health care may mean even longer lifespans for those who turn 65 in 10 or 20 years from now. Some of us may be so “above average” that we live past 100, and that percentage may grow with scientific breakthroughs.3
Extended care coverage, or coverage that offers the potential to keep a household, can be important in a marriage. It may be wise to have a life insurance trust created for the benefit of one spouse or have one spouse own a particular policy.
Using a life insurance trust involves a complex set of tax rules and regulations. Before moving forward with a life insurance trust, consider working with a professional who is familiar with the rules and regulations.
Several factors will affect the cost and availability of life insurance, including age, health and the type and amount of insurance purchased. Life insurance policies have expenses, including mortality and other charges. If a policy is surrendered prematurely, the policyholder may also pay surrender charges and have income tax implications. You should consider determining whether you are insurable before implementing a strategy involving life insurance. Any guarantees associated with a policy are dependent on the ability of the issuing insurance company to continue making claim payments.
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Since 2004, TCM Wealth Advisors has been providing Fee-Only Fiduciary Advice to our clients in Northeast Ohio (Akron/Canton, Cleveland), and around the country.
This content is developed from sources believed to be providing accurate information, and provided by Twenty Over Ten. It may not be used for the purpose of avoiding any federal tax penalties. Please consult legal or tax professionals for specific information regarding your individual situation. The opinions expressed and material provided are for general information, and should not be considered a solicitation for the purchase or sale of any security.