Most people who work in the United States plan to retire when they reach the appropriate age. They have savings accounts and plan to relax living out their dreams once work is no longer on the agenda, but many forget to account for insurance.
Some of the policies most carry while they work may not be necessary once retired, but others should be maintained even through retirement.
Policies you should plan to keep:
The chances that you will retire, immediately give up your driver’s license, and never get behind the wheel of a car again are slim to none. It is illegal to drive without being insured, so the car insurance has to stay. Consider upping your policy to full coverage; it would be much harder to afford a replacement vehicle if yours were to get wrecked without that steady paycheck.
Homeowner’s or renter’s insurance
You will still have to live somewhere when you retire, and whether you own or rent, there’s a policy for that. You should always have a policy in place to protect your home and possessions from burglary, fire, and natural disasters, especially once you retire; since it would be very difficult to replace these things without a paycheck.
Most employers offer health coverage for their workers. Once those workers retire, the employer is required to continue providing this coverage for an additional 18 months. After that, it is your responsibility to find your own insurance. At age 65, Medicare becomes available to the retiree, but it won’t cover everything, so be sure to have a supplemental policy of some kind. Look into policies that cover long-term care; in your old age you may need it, and it’s not cheap. Policies to cover long-term care are expensive, but the younger you enroll, the less your premiums will be.
Renter Insurance as the name suggests is meant for landlords who have rented their apartments or home etc. So, it does not matter whether you live in an individual flat or duplex you need to have renter’s insurance to protect your belongings and valuable items. The best part of renter’s insurance is that it is available at an affordable rate; you just need to research well. Renters generally need this insurance to protect the house structure or land where the apartment is situated. It provides you protection as and when you retire. Thus, this insurance makes you self-sufficient in your unfavorable days.
Medicare Insurance can act as supplemental insurance because when you reach the age of 65 it becomes available but it is not the insurance plan to bank upon. They generally vary in cost and structure.
Policies to cut back, or let go:
- Life insurance
Life insurance policies are very important during the working years because that money is intended to help your family make ends meet holding their standard of living if you were gone. If a retirement plan has been built wisely, the loss of a spouse would not leave the remaining partner without a means to pay for their everyday living expenses. Consider cutting back your life insurance policy to an amount that will cover your final expenses with little excess to save money in retirement.
- Disability insurance
Disability insurance is concurrent with becoming unable to work due to sickness or injury. Once you retire, you have no job income to protect; so it is unneeded unless you retire before age 62 when the government-provided disability coverage kicks in. It covers all the possible risks which make working painful or uncomfortable.
Be sure to give insurance issues very careful thought when planning for your retirement. What you plan for and save for are all you have to live the rest of your life on once you retire, and adequate planning could be the difference between a state nursing home and a condo near the beach in your old age.