Can I keep my life insurance when I retire?
Asked by: Dr. Hal Considine II | Last update: January 22, 2026Score: 4.4/5 (24 votes)
At what age should you stop paying for life insurance?
Many people in their 60s and 70s may no longer need life insurance. They may have already paid off the house, stopped working, sent the kids off to care for themselves or accumulated enough assets to offset the need for life insurance. But sometimes buying or maintaining a life insurance policy over age 60 makes sense.
What happens to your insurance when you retire?
If you've been relying on your employer's group health insurance, your coverage will likely end, although 21% of large firms extend healthcare coverage to retirees, so check to see if your employer is one of them.
Do you lose work life insurance when you retire?
If you decide to retire or leave your current employer, your coverage will end, although many employers' plans offer options to continue your coverage.
What happens to my whole life policy when I turn 65?
Your life insurance benefit is permanent.
Getting a new policy becomes more expensive (or even impossible) as you age. Permanent life insurance policies — like a whole life policy — often stay in force through age 100 or even higher, at which point the full death benefit is paid out.
Can I Keep My Life Insurance When I Retire? - AssetsandOpportunity.org
Should I cancel my life insurance when I retire?
Very often, the answer is “Yes, you should surrender your life insurance policy”, because by the time individuals reach retirement, their mortgage is paid off, kids are through college and out of the house, they have no debt outside of maybe a car loan, and they have accumulated large sums in their retirement accounts.
When should you cash out a whole life insurance policy?
Many advisors generally recommend waiting at least 10 to 15 years to cash out your whole life insurance policy.
What happens to my life insurance policy when I retire?
What happens to my life insurance when I retire? Individual life insurance policies you have won't be affected by your retirement. However, most employer-provided group life insurance policies end when you retire.
How much is a $500,000 life insurance policy for a 60 year old man?
For a 60-year-old man, a $500,000 term life insurance policy might cost approximately $80 to $150 per month, depending on health and term length. Whole life insurance for this age could be significantly higher, potentially around $500 or more per month.
Does life insurance affect Social Security benefits?
A life insurance payout won't typically impact your benefits if you're collecting Social Security due to retirement. However, if you have a disability and use the Supplemental Security Income (SSI) program, life insurance can affect your Social Security benefit.
How long should you keep life insurance?
Consider a life insurance term length of at least 30 years. If your spouse is your designated beneficiary, they would receive the death benefit if you pass away within those 30 years, and they could use the payout for the remaining mortgage payments.
Can you keep private insurance after 65?
It depends on how you are receiving your current insurance. If you are receiving employer-sponsored health insurance through either your or your spouse's job when you turn 65, you may be able to keep your insurance until you (or your spouse) retire(s).
How do retired Americans pay for healthcare?
But here's the rub: Medicare covers some medical expenses, but not everything. And it isn't free – you pay Medicare premiums in retirement, and these premiums can increase as the years go by, as can your out-of-pocket expenses. That's why you need to have a plan to cover your health care costs beyond Medicare.
Do I get my money back if I outlive my life insurance?
Do you get your money back at the end of a term life insurance policy? You can't get your premium dollars back from a standard term life insurance policy once it expires. However, if you buy a return of premium (ROP) rider, then you could get some or all of your premium back if you outlive your policy.
Do I really need life insurance after retirement?
You could need life insurance in retirement if you want to cover your final expenses and estate taxes, have outstanding debt, still earn income, or want to provide a tax-free inheritance to your loved ones. Otherwise, you probably do not need life insurance after retirement.
At what point should you stop buying life insurance?
If your mortgage is paid in full or your family's savings and supplemental income are enough to keep up with payments, you could consider canceling your term life coverage.
Is 65 too old for life insurance?
Some may think that older people over the age of 65 cannot get new life insurance coverage because of age and pre-existing health conditions. This is not true, though. Life insurance at the age of 65 is attainable and affordable if you know where to look.
What's the difference between term life and whole life insurance?
Term life is often the most affordable life insurance because it's temporary and has no cash value. Whole life premiums are much higher because the coverage typically lasts your lifetime, and the policy grows cash value. Here's how annual premiums compare for term life policy vs.
How to use life insurance as a retirement?
Life insurance can help you create guaranteed income in retirement. If you want guaranteed income in retirement and don't have a need for your life insurance death benefit anymore, you may be able to turn your cash value into an income plan that will pay you a guaranteed monthly amount—typically for as long as you live ...
Do you lose insurance when you retire?
There is no break in coverage between your employment coverage and your retirement coverage. If you don't want your health benefits to continue into retirement, you can cancel your coverage through your employer before you retire.
Can you cash out life insurance when you leave a job after?
Generally, if you have no other options, your life insurance coverage will end when you leave your job. That means you'll need to apply for new coverage (either at your new job or independently from a life company or agent) based on your current age and health status.
Is there a penalty for cashing out whole life insurance?
Some policies will have a surrender fee in the case of cashing out an entire policy, while others may charge fees for partial surrenders. Other than that, there are no additional penalties or fees. The surrender fee is usually 10% to 20% but it can be as high as 35% to 40%. Check your policy contract.
How much tax will I pay if I cash out my life insurance?
Is life insurance cash value taxable? Fortunately, the cash value of life insurance grows tax-free. This means that, in many cases, you won't have to worry about paying taxes on it.
Do you get money back if you cancel whole life insurance?
If you decide to cancel whole life insurance or another permanent life product, you could receive a payout based on the cash surrender value. Surrender charges: Be mindful that surrendering your policy, particularly in the early years, often incurs surrender charges. These fees will reduce the amount you receive.