Life Insurance Planning: The Difference 20 Years Makes

Life insurance planning changes as your life does. What you need at 35 is not the same as what you’ll need at 55. Knowing how your needs shift can help you make better choices now, save money and help you feel prepared later.

At age 35: Protecting your family and income

When you’re 35, your financial priorities often include:

Covering your mortgage until it’s paid off

Your home is probably your biggest asset and debt. If something happens to you, life insurance can help your family keep the house without money worries. Choosing term coverage that matches your mortgage length helps protect this investment.

Funding your children’s education

College can be expensive. Life insurance helps make sure your children’s education plans stay on track if you’re not there to provide for them. Many families opt for term coverage that lasts until their youngest finishes school.

Replacing your income if something unexpected happens

Your income supports your family’s lifestyle and goals. If you pass away suddenly, life insurance can replace your income for years, helping your loved ones stay stable and cover daily costs without money problems.

At this point, term life insurance is usually a good choice. It’s affordable and covers you during the years you need it most. A 20- or 30-year term policy can protect your family until big expenses, like tuition and housing, are taken care of.

Key benefits of term insurance at 35:

• Lower premiums compared to permanent coverage.
• Flexible term lengths to match your financial timeline.
• Simple, straightforward protection.
• But your life and financial goals keep changing after 35.

At age 55: Legacy, retirement and living benefits

Twenty years later, your mortgage might be paid off and your kids are adults. But new priorities can come up.

Leaving a legacy for children and grandchildren

At this stage, you’re thinking about more than just replacing your income. You may want to leave a financial legacy for your loved ones, help with grandchildren’s college, support a family business or leave a special gift. Permanent life insurance can help make sure your estate plan includes guaranteed funds for those you care about.

Supplementing retirement income, especially after market downturns

Market fluctuations may present challenges in early retirement. When withdrawals occur during downturns, retirement savings might experience delayed recovery. Permanent life insurance with cash value could potentially serve as an alternative income source. Rather than liquidating investments during unfavorable conditions, policyholders might consider utilizing their policy’s cash value, which may allow investment accounts time to potentially recover and could contribute to financial stability.

Covering health-related expenses with living benefits riders

Health issues often become more important as we get older. Dealing with a serious illness can be overwhelming and cost more in retirement than you expect. Life insurance with an accelerated death benefit rider can help by giving you part of your policy’s death benefit while you’re still alive, easing the financial burden.

Planning for income after a spouse passes away

At 55, many people overlook how retirement income changes if a spouse passes away. Expenses might go down a little, but income often drops a lot. Social Security only pays the higher of the two benefits, not both. This can be tough, especially for women who often live longer. Life insurance can help fill this gap and provide the surviving spouse with financial security.

Permanent insurance, unlike term policies, lasts your whole life if appropriate premiums are paid and builds cash value you can use in retirement. It’s not just about the death benefit now; it also gives you more flexibility and protection.

Why permanent insurance matters at 55:

• Lifelong coverage for estate planning and legacy goals.
• Tax-advantaged cash value growth.
• Living benefits for serious illnesses.

Learn more: Permanent Versus Term Life Insurance Explained

Why planning early pays off

Permanent insurance costs less when you’re younger and healthier. If you wait until 55, you may face:

• Higher premiums due to age and risk factors.
• Possible health changes that limit your options.
• Less time to build meaningful cash value.

If you start earlier, you may get lower rates and more time for your policy to grow. Even if you already have term insurance, many policies let you switch to permanent coverage, often without new medical checks.

Term conversion: A bridge strategy

A key feature of term life insurance is conversion, which lets you change your term policy to permanent coverage, often without new medical exams. This option can save you money over time, especially if you plan ahead.

How to plan for the next 20 years

Here are some practical steps to help with life insurance planning for the future:

1. Review your current coverage: Does it align with your long-term goals?

2. Consider adding permanent insurance now: Even a small policy can grow significantly over time.

3. Explore term conversion options: Don’t let this benefit expire unused.

4. Work with a financial professional: They can help you balance affordability with future needs.

Ready to take the next step?

Your life insurance needs are likely to change over time. The real question is whether you’ll plan for those changes now or end up paying more later. Learn more about life insurance offerings from Ameritas and schedule a review today to look at your options and help secure the future you want for yourself and your loved ones.

Disclosures

Loans and withdrawals will reduce the policy’s death benefit and available cash value. Excessive loans or withdrawals may cause the policy to lapse. Unpaid loans are treated as a distribution for tax purposes and may result in taxable income.

Living benefit riders are not a long-term care product.

Representatives of Ameritas do not provide tax or legal advice. Please consult your tax advisor or attorney regarding your specific situation.

In approved states, life insurance is issued by Ameritas Life Insurance Corp. In New York, life insurance is issued by Ameritas Life Insurance Corp. of New York.