Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
DW is 6 years older than me. I plan to retire at 62. We will likely go the whole life route or possibly the 50%. Not 100%. My objective is to make sure she is ok, not better off without me!
I have a pension with COLA and the wife happily signed off on no survivor benefits because of the reduction plus the reality that she will likely predecease me.
Bought a fixed premium whole life policy to cushion the blow. Would have preferred term but renewing at 84 (retired at 54) would be impossible so went with whole life. Also bought LTCI.
Oddly this was a more difficult decision for me than it was for her.
A word of caution for folks having to make this decision and having not yet done so. In all likelihood the people you work with will have to make similar decisions if married. They may be friends of your or you and your spouse find yourselves in a social setting with them. This also applies to neighbors and friends with pensions.
What your spouse is ok with when you explain why can go south when they hear somebody else explain why they did what they did.
The killer can be when another person says they took reduced pension benefits because they love their spouse and wanted them to be in the best shape possible. That can be a big ouch if you didn't. It can come up in interesting ways especially in or near retirement. I have seen it happen and it was a serious ouch for a friend of mine and resulted in a long ride home with our wives. Mine was fine his not so and he passed last year and she is partially screwed if not completely and is realizing the differences in our retirements.
When I retired, I took less money so my spouse would be covered at 100%. He died first. Well imagine my surprise when I found out I was going to get all the money back, the difference between the lower and the higher amounts plus the higher amount for the rest of my life. So in my case it ended up costing me nothing to cover my spouse. Check and see if this is true about your plan!
This is a true story and maybe a warning. My wife retired (at age 62) from a high level job with a state government. She had choices as discussed here. As the women in her family typically lived well into their 90's (her mother still alive at age 99) and the men in my family rarely made it past 75 (I was 2 years younger then her). We discussed it and opted for maximum amount of retirement for her. She died 2 years ago at age 76. I am now age 76 and going strong. We did discuss an insurance policy on her but as an ex-smoker (and they tested for such) the rates were outrageous so we decided not to do it.
The good news is that as a survivor, that state allows me to keep health insurance (Supplemental B and D?) going for $45 per month. If I remarry, I lose it.
I am not crying poor mouth but sometimes the odds do not work out but betting on the odds is the still the best bet
This is a true story and maybe a warning. My wife retired (at age 62) from a high level job with a state government. She had choices as discussed here. As the women in her family typically lived well into their 90's (her mother still alive at age 99) and the men in my family rarely made it past 75 (I was 2 years younger then her). We discussed it and opted for maximum amount of retirement for her. She died 2 years ago at age 76. I am now age 76 and going strong. We did discuss an insurance policy on her but as an ex-smoker (and they tested for such) the rates were outrageous so we decided not to do it.
The good news is that as a survivor, that state allows me to keep health insurance (Supplemental B and D?) going for $45 per month. If I remarry, I lose it.
I am not crying poor mouth but sometimes the odds do not work out but betting on the odds is the still the best bet
I remember well your saga and our conversations on this topic over time both before and after your wifes tragic passing. Once again best of luck moving forward.
Several folks here keep referring to a WHOLE life, rather than a TERM life policy. A TERM life policy costs significantly less than a WHOLE life policy, which makes the life insurance vs full pension discussion more relevant. If the option was WHOLE life vs full (or reduced) pension, the cost would likely be high enough to partly offset the benefit of a full vs reduced pension (Re: Post #54+).
With a TERM life policy (sufficient to cover about 10-years of full pension benefits), we now gain over $12K in annual pension benefits - in exchange for a $3K Term life policy cost.
term insurance that no longer covers a spouse that needs the pension money does no one any good . it is either there like the pension until death or it is not going to protect them unless they don't need it .
if someone needs term insurance to cover the pension why would you spin the wheel of life that you may die the year after the insurance terminates ?
why in one year would they go from needing term to cover them to they don't need any insurance 1 year later ?
term insurance that no longer covers a spouse that needs the pension money does no one any good . it is either there like the pension until death or it is not going to protect them unless they don't need it .
you can't do it both ways .
It depends on the age and financial condition of the individuals. A couple in their mid-60's with other financial resources, may feel like a 20-year policy (carrying the surviving spouse through their mid-80's) seems like a reasonable investment in one's ongoing income - and peace-of-mind).
Like most insurance, a term life policy only pays off when one needs it (as does the often debated LTC insurance). While one can buy Whole Life insurance to ensure someone will get a payoff at the end, it is typically so expensive that one who lives a long life, may well pay more in premiums, than their heir/s gets back in benefits (particularly considering today versus then-year dollars and inflation).
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.
Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
