Tag: life settlement

What Is An In-Force Illustration?

Every year more seniors realize the benefit of exploring a life settlement to get an immediate benefit from an unneeded life insurance policy. As settlements become a more popular option, consumers are realizing that they can investigate and enter into life settlements themselves if they choose, without going through an advocate. But to go through that process, they must first understand the steps of a life settlement and define the terms of the industry. One of the most important steps is obtaining an in-force illustration.

obtain inforce illustrationAn in-force illustration might sound like a concept only understood by insurance professionals, but in fact it is quite straightforward and a critical step in the life settlement process. After a person over the age of 65 does preliminary research into a life settlement using Magna’s simple calculator or through a phone call with a Magna settlement advisor, the next step is to obtain an in-force illustration from the insurance provider and submit it to Magna.

Magna Life Settlement Calculator

How can you obtain an in-force illustration?

Call your insurance carrier with Magna

Magna can help you gather an in-force illustration from your life insurance carrier. First, schedule a time for a Magna Case Administrator to call you. Together, we will contact your life insurance carrier to request an in-force illustration.

Call your insurance carrier and request an in-force illustration

Or you may call your insurance carrier by yourself. On the call with the insurance carrier, please request the following type of in-force illustration:

“Solve for minimum level premium to maintain the death benefit through maturity, solving for $1,000 of account value at maturity.”

Important facts about the in-force illustration

Projects the future costs of premiums

It projects the future costs of premiums through maturity of the policy, allowing a policyholder to accurately compare the costs and benefits of keeping a policy versus selling it in a settlement.

Comes from the life insurance carrier at the request of the life settlement provider

The in-force illustration finds the minimum premium liability until the policy matures (typically at age 100) and the net value of the policy is $1,000. Because the illustration uses current interest rates, it often produces results very different from the projections at the time when the policy originated.

It is a valuable tool for both consumers and settlement providers

Our Magna life settlement provider will schedule a call with a client, and together they will call the insurance company to request the in-force illustration. The results will inform both the client and Magna’s representatives about the suitability of a life settlement, and if the client decides to move forward the next step is a comprehensive review of the policy and an informal offer from Magna.

In-force illustrations are valuable for anyone with a life insurance policy

They keep consumers informed and eliminate unwelcome surprises if interest rates and premiums go up. But for those considered a life settlement, these illustrations are a critical step that illuminates the costs and benefits of holding onto a policy versus selling it for a cash windfall. Schedule a call with  Magna’s life settlement expert today to learn more.

Accelerated Death Benefit Versus Viatical Settlement: Which Is Best For You?

accelerated death benefitHearing the news that a loved one is facing a terminal diagnosis is stressful for everyone in the family, and unfortunately financial concerns can also come into play along with the prospect of impending loss. What are the options for a terminally ill senior facing mounting medical or care expenses? Can a life insurance policy be leveraged to help meet that need?

There are two different options allow a policyholder to get cash out of a life insurance policy that might not be needed anymore. Both viatical settlements and accelerated death benefits could offer financial relief to families facing a difficult diagnosis, but the two agreements are different in several key ways.

Accelerated Death Benefit

An accelerated death benefit (ADB) is a provision attached to some life insurance policies that allows consumers to borrow against the value of the death benefit in the event of a terminal illness. The ADB, which comes in the form of a cash advance, is generally tax-free if the expected life expectancy of the policyholder is two years or less.

Generally an ADB is laid out as one of the features of a policy when it is originally issued, but according to some experts most insurance companies will consider providing the benefit if the policyholder meets the requirements, even if it wasn’t originally part of the policy. According to a January 2018 article on Investopedia, individuals may be eligible for an ADB if they meet one of the following criteria:

  • Diagnosis of a terminal illness with life expectancy of two years or less
  • Diagnosis of any serious illness that will reduce expected life span
  • Need for an organ transplant because of serious illness
  • Enrollment in hospice care

In most cases, a policyholder who accelerates his or her death benefit to help defray expenses only borrows against part of the policy, leaving a reduced death benefit that is still available for the original beneficiary. For example, if an individual with a $1 million life insurance policy needs funds for health care, he could borrow against half of that policy, receiving an offer of $265,000 cash against $500,000 of life insurance. That would leave $500,000 to go to his beneficiary upon his death.

Viatical Settlement

 A viatical settlement is a type of life settlement, but generally viatical settlements are reserved for those who have been diagnosed with a chronic or terminal illness. A terminally ill person is defined, for tax purposes, as one whose physical condition will be reasonably expected to end in death within twenty-four months of certification. A chronically ill individual is one who has been certified by a healthcare professional with either a substantial physical or cognitive impairment.

In a viatical settlement, a life insurance policy is sold to a third party for a lump sum, and the buyer assumes the premiums and receives the death benefit when the seller dies. The proceeds from a viatical settlement are generally exempt from federal taxation, because the Internal Revenue Service considers the payout to terminally ill individuals to be taxed in the same way as a benefit upon the death of the insured. In the case of someone who is chronically ill, the settlement proceeds can be tax exempt if the funds are used to cover certain health care expenses.

How to Determine Which is Best?

If a terminal illness has caused a financial strain, a life insurance policy can become an asset while the policyholder is still alive, but the individual will need to research the details of his or her policy to determine which type of transaction is better and more profitable for the situation. Sorting out the best path to help provide financial help to a family suffering a health crisis can be stressful, and a trusted advisor could help make sense of the situation and lay out the potential advantages of either path.

The first step, for any individual or their advisor considering the two options, is to determine whether the original policy included an ADB and whether the provider is willing to negotiate one if it isn’t laid out in the original terms. On the other hand, a viatical settlement usually requires documentation of a terminal diagnosis, so if such evidence is not available an accelerated death benefit might be the right choice.

The experts at Magna Life Settlements stand ready to advise anyone who thinks they might be eligible for a viatical settlement and answer any questions about the process involved in the sale. Set up a call with Magna today to ensure the best possible advice for your family through the illness of your loved one.

*Comments provided in this post are for informational purposes only and should not be construed as financial, legal or tax advice, recommendations or solicitations. Please consult your financial, legal or tax professional with questions related to the information presented, or for advice as to whether a life settlement is right for you.

Cash Surrender Value: Know the Facts and Understand the Options

Cash Surrender Value: Know the Facts and Understand the Options

When a life insurance policy has outlasted its usefulness, the first step is for a policyholder to consider the best next option, and for universal and whole life policies that process starts with determining that policy’s cash surrender value. In order to understand the surrender value and its potential benefits or drawbacks, an individual at an insurance crossroads should know how that number is determined, why a surrender could be the best option for some people, and whether a possible alternative might be more profitable.

How Cash Surrender Value is Found

When a policyholder makes premium payments over the years to a whole life or universal life insurance policy, a portion of those payments accumulate as cash value and part of that amount goes to the death benefit of the policy. Cash surrender value is essentially the value of the money the individual has put into the policy, with a few variables like the performances of the markets in which the insurance company invested your money and the subtraction of fees charged by the agency.

For universal life, the longer a policy is in effect and the more robust the markets that were selected for a policy’s investment, the larger the cash surrender value will be. The value of a whole life policy grows at a fixed rate designed to grow the policy to the amount of the death benefit when the policy matures. Term life policies do not have a cash surrender value. The cash surrender value should be readily available to the policyholder with just a simple request to the insurance agent. Periodic reviews of a life insurance policy are recommended for everyone, and through the review process the policyholder will be able to track the growth of the surrender value.

When Terminating a Policy Might Be Beneficial

Every situation is different, and some people might find that they need to retain their life insurance policy but still need to obtain some of the cash value that has accrued. In those cases, a policyholder might borrow against their cash value, arrange to pay premiums using the cash value or even take out part of the cash value while leaving the policy in effect (the second and third options are not recommended for whole life insurance policies).

But if the policyholder’s circumstances have changed so much that the death benefit is no longer needed, an individual might decide to surrender the policy in order to receive the net cash surrender value. If a policy has been in place for a decade or more and the policy’s investments have fared well, the cash value will be hit with fewer fees and surrender charges. In that scenario, it might be worthwhile for a policyholder to benefit from that money and stop paying premiums at the same time. Such a decision, however, should be made only after weighing the other options available for making a profit off of an unwanted policy.

A Better Option?

It is crucial for those with life insurance policies to understand the determination and amount of their cash surrender value, but that doesn’t mean that their best path is always surrendering the policy to get their hands on that cash. The more lucrative option, in many cases, is to pursue the sale of the policy through a life settlement.

Life settlements aren’t the right choice for everyone, but if you are a candidate for a settlement you could yield a payout that is significantly higher than the cash surrender value of the life insurance. The two chief variables that determine suitability for a life settlement are the impairment level of the policyholder and the cost structure of the original policy. Generally speaking, the more serious the health impairment, in inverse relation to a more favorable rating when the policy was issued, creates the best situation for a profitable life settlement.

For example, if a universal life policy was issued at preferred-plus and the policy holder becomes significantly more impaired than predicted, a life settlement could yield sums up to four times the stated cash surrender value. Despite the possibility of a significantly larger payoff, many seniors go with a surrender anyway and take the cash value, because they have never been informed about the potential advantages of a life settlement.

Every policyholder should be informed about the value of their policy and the options before them when the insurance is no longer needed. Magna is a trusted life settlement representative that also works with insurance agents looking to present the best possible scenario for their clients. Seniors interested in learning more about the life settlement option can use our simple life settlement calculator to determine their next steps, and agents can learn more about our services to partner with insurance professionals by viewing our resources here. With the right information, insurance policies that have become a liability can benefit policyholders and help offset costly retirement expenses.

How to Prepare for Historic Wealth Transfer From Boomers to Generation X

How to Prepare for Historic Wealth Transfer From Boomers to Generation X

It’s a stunning number with significant repercussions: According to a recent report from Cerulli and Associates, Baby Boomers will transfer approximately $68 trillion in assets to their heirs or charitable organizations in the next quarter century. Most of that money will end up in the hands of Gen Xers, making that generation the wealthiest in the nation by the end of that 25-year period.

That large wealth shift is a byproduct of the graying of America and an emerging understanding of new ways to grow wealth after retirement. It’s a transfer rich with opportunities for both the seniors who wish to leave a meaningful legacy and the younger generation looking to optimize the resources entrusted to them. Following are some key principles for both groups to give those dollars the most impact:

Consider Giving Money to Your Heirs Before Death

Gifting portions of an inheritance before the individual dies has several advantages. First of all, such gifts are tax-free, whereas money that comes through an inheritance can be hit with heavy tax burdens. Additionally, those who opt to give their estates away while they are still alive have the benefit of witnessing the opportunities their money can create for their loved ones. The IRS limits such wealth transfers to $15,000 per recipient per year, so the method is limited for those with large estates.

Understand the Different Needs of Each Generation

Because Baby Boomers and Generation Xers have disparate priorities, a trusted financial advisor can help navigate a transfer of resources in a way that will best serve the needs of both the giver and the recipient. As Patrick Kiger wrote on the AARP website in November 2018, “Boomers are shifting from accumulating assets to spending in retirement while focusing on passing along their wealth. Many in Generation X, by contrast, are entering their primary earning years and are planning for their children’s education. “

Create a Comprehensive Legacy Plan

For many people planning to pass on their wealth, charitable and educational giving are important pieces of the puzzle. To make sure your wishes are carried out and your resources are in position to make the kind of impact you have envisioned, create a detailed estate plan with your financial advisor. Your advocate might recommend the establishment of a trust to earmark your wealth for a certain purpose, control when it can be accessed and keep your estate out of the costly and time-consuming probate court process.

Seek Ways to Preserve and Grow Your Estate by Reducing Retirement Costs

As lifespans become longer and the expenses associated with retirement mushroom, seniors who wish to leave a legacy must take measures to make sure they still have an estate to pass on after they die. In some cases, this long-term planning might involve purchasing long-term care insurance, while other individuals might grow their wealth with diversified investments. Another option, one that can shed unnecessary expenses and grow wealth at the same time, is a life settlement. Often seniors are carrying life insurance policies that no longer meet their needs, and if they qualify for a settlement they can exchange that liability for an asset–a cash windfall that will help pay for retirement expenses and increase the value of an estate down the road.

Strive for Healthy, Ongoing Communication Between Estate Holders and Heirs

Both Baby Boomers and Gen Xers stand to benefit from this historic transfer of wealth, but when the older generation and the younger one are on the same page those resources will be in a position to do the most good and pass on a legacy of strong relationships and careful planning. The children, and even grandchildren, of seniors should make sure they are informed about the wishes of their loved ones and the particulars of the estate, and older Americans should likewise consult with their heirs when making major financial decisions.

For seniors who have worked hard and saved well, an informed transfer of wealth can help ensure a legacy that far outlives the giver. As a large portion of America’s wealth is redistributed and the younger generations seek to make the most of their new financial opportunities, trusted advisors, armed with information about vehicles like life settlements, will help support those on both ends of this pending great wealth shift.

*Comments provided in this post are for informational purposes only and should not be construed as financial, legal or tax advice, recommendations or solicitations. Please consult your financial, legal or tax professional with questions related to the information presented, or for advice as to whether a life settlement is right for you.

How Seniors Spend Their Retirement Expenses [2019 Guide]

It’s something every adult understands—saving for retirement is a necessity. But beyond the nebulous idea of “putting money away for later,” how much do we really know about the actual costs incurred by American seniors? It’s a misconception that spending decreases after retirement; in fact, a study by the Employee Benefit Research Institute shows that 33 percent of all households containing retirees increase their expenses in the six years after they stop working. Whether due to mandatory needs like healthcare or elective spending like travel, seniors have more need than ever to have a handle on their finances and a thorough understanding of income options like life settlements.

Following are some of the primary areas where research shows expenses are rising for seniors:

Healthcare

This is the category that hits many senior adults the hardest, because of the obvious surge in medical needs as people age. An article from CNN Money estimates that the average 65-year-old man will spend $189,687 on healthcare in retirement, while an average 65-year-old woman will spend $214,565. Because medical situations and their attendant costs are unpredictable, they are one of the key reasons seniors need to seek alternate sources of income and understand how to plan for healthcare expenses during retirement.

Housing

Even if healthcare costs can mount fast, housing expenses are the most consistent hits on a senior’s budget. A 2015 study from the Social Security Administration indicates that households with people over 65 spend about 35 percent of their funds on housing, more than twice the amount spent monthly on out-of-pocket healthcare, which came to 13 percent. When all of the costs associated with housing are considered—mortgage or rent payments, utilities, maintenance and furnishings—seniors spend an average of $14,034 annually, according to a breakdown in U.S. News and World Report.

Transportation and Travel

Even though some seniors see a drop in gas costs when they stop working, transportation is still the second-largest expenditure, according to the Social Security Administration study, comprising 15 percent of the average senior’s budget. Transportation costs, as well as money spent on hotels, food and other entertainment, tend to rise in the retirement years because of the extra time for travel in retirement years. To mitigate this expense, seniors can seek travel discounts just for those 65 and older, and they can also take advantage of the freedom to travel during off-peak times when working people are unavailable.

Long-Term Care

Americans are living longer and care options are becoming more expensive, a combination that leads to a consistent gap between needs and resources for today’s retirees. Even those who purchase long-term care insurance may find the benefit isn’t sufficient for their needs, and many seniors don’t put money away for the possibility and end up in a financial bind when they need long-term care. A 2017 study by Genworth Financial shows that long-term care, independent of medical bills, costs seniors anywhere from $18,000 a year (adult day care) to $97,000 a year (private room in a nursing home). And it’s a situation the majority of seniors will face; about 70 percent of 65-year-olds will incur some type of long-term care costs in their lifetime, at an average cost of $138,000 per person.

Food

Of course, people over 65 continue to incur the same basic expenses as every other age group, and food is no exception. Seniors can save by using coupons or store discounts, but groceries and dining out still make up one of the major budget categories for older Americans. For the cost-conscious senior, eating at home is by far the more economical option, although travel and other obligations can make the convenience of restaurants much more tempting. An example presented in a 2018 Motley Fool article speculated that if an average meal at a restaurant costs $50, the same food prepared at home would cost $12.50. Using those numbers, the article calculated that a senior who skipped two restaurant meals a month would save $900 a year.

Even though these five categories are typically the ones that cause the most headaches for seniors, other expenses can also be unexpectedly high during retirement—education costs for family members, insurance and entertainment, to name a few. Seniors can help to combat an expensive retirement scenario with a number of strategies, including part-time employment, using their resources as sources of income (such as renting out a room or driving for a ride sharing service), understanding tax deductions for seniors or cashing in an unwanted life insurance policy.

Seniors don’t have to cancel life insurance; instead, a life settlement can turn a burdensome policy into a valuable asset. Magna Life Settlements buys existing life insurance policies, and any senior seeking to budget for retirement expenses should become informed about the growing popularity of such settlements. To learn more, set up a call with a Magna representative today.

*Comments provided in this post are for informational purposes only and should not be construed as financial, legal or tax advice, recommendations or solicitations. Please consult your financial, legal or tax professional with questions related to the information presented, or for advice as to whether a life settlement is right for you.

What is a Life Settlement? [2019 Guide]

In many circumstances, a life insurance policy is an important investment that can benefit those left behind when a loved one dies. Many financial advocates would recommend life insurance to a client, but those same advisors understand that the efficacy of life insurance often runs its course. What alternatives exist for older policy holders who are still paying premiums despite the fact that their needs have changed and they don’t really need the policy anymore? It is possible that those individuals can sell their life insurance policy for cash value through a life settlement, in which a third party buys an unwanted insurance policy in exchange for cash. Here are some facts about the life settlement option:

The History Behind The Life Settlement Industry

The origin of life settlements dates all the way back to a 1911 Supreme Court case called Grigsby v. Russell. In the 1980s sellling an unneeded life insurance policy for cash became a way for people with diminished health to obtain funds for medical and living expenses. In the years since, legislation and tax laws have created a more favorable climate for consumers looking for options when an insurance policy is no longer needed. Statutes passed in the last five years now mean that 90 percent of Americans are protected by comprehensive life settlement legislation.

What Are The Benefits Of Selling My Life Insurance Policy?

The retirement years are costlier than ever, both because of the rising price of health care and the uncertainty of government resources like social security. A life insurance policy is an asset that can outlive its usefulness; the original beneficiary might not need the proceeds anymore, or the premiums have become burdensome. Under these circumstances, it is worthwhile for a senior to explore an option that can free up cash in the sale of that unwanted policy. Besides the obvious cash windfall, a life settlement also eliminates the premium payments that have depleted even more of a retiree’s limited resources.

Do I Qualify?

Two key variables dictate whether an individual would benefit from a life settlement: the policy holder’s level of health impairment and the cost structure of the policy. The two factors are related, where a policy issued with a higher rating combined with a poor health prognosis can result in a promising settlement offer. For example, if a universal life policy was issued at preferred-plus and the policy holder becomes significantly more impaired than predicted, a life settlement would provide a payout higher than the stated cash surrender value. Some policies are not a good fit for a settlement, and the owner may be better off to either surrender their life insurance policy for cash value, borrow against the policy’s value, or negotiate another option with their carrier. To find out whether a life settlement might be a good fit for you, visit Magna Life Settlement’s simple calculator.

What Are The Steps To Sell My Life Insurance Policy?

Because a life settlement can provide a significant cash payout to help pay for retirement expenses, no one should miss that opportunity simply because they don’t understand the life settlement process. As the word gets out about the potential upside of life settlements, seniors who are likely to benefit from these transactions need guidance about how it works and how to start the process. Here are the basic steps of a life settlement:

1. Determine your eligibility. Using Magna’s calculator, first determine whether your medical status and the specifics of your policy make you a good fit for a settlement.

2. Submit an in-force illustration. With the help of a Magna case administrator, you will request an illustration from your life insurance carrier that spells out what the minimum premium costs would be if you kept the policy until it matures – typically at age 100 – and if the net policy account value at maturity was $1,000. This allows us at Magna to determine how much your policy may be worth.

3. Submit additional healthcare data. At this point, you will fill out a HIPAA form protecting your privacy and submit your health data. This also helps us to determine how much your policy may be worth.

5. Wait for Magna review and informal offer. Then, your Magna representative will calculate the value of your policy and decide whether or not to make you an informal offer, pending the next steps of information gathering.

6. Magna obtains medical records and life expectancy report. These reports verify your policy value so that Magna can calculate an offer that pays out the maximum amount for your policy.

7. If your policy qualifies, Magna extends a formal offer. If you accept the offer, you will receive cash in exchange for the sale of your policy after the sale is complete. This closing process takes some time. Similar to buying a house, a life settlement involves signing contracts.

8. Magna takes over the policy. After the settlement transaction closes, Magna is responsible for paying all future premiums and receives the death benefit once the policy matures.

If you are interested in receiving a personalized life settlement estimate or have questions about the process, contact a Magna representative today.

*Comments provided in this post are for informational purposes only and should not be construed as financial, legal or tax advice, recommendations or solicitations. Please consult your financial, legal or tax professional with questions related to the information presented, or for advice as to whether a life settlement is right for you.

Sell a Life Insurance Policy For Cash?

sell life insurance policy for cash

With the promise of the insurer passing over a pre-determined amount of cash to your beneficiaries upon your demise, you are expected to pay monthly or quarterly premiums to the insurer. But what happens when you are unable to pay or feel like you don’t want to continue with the life insurance policy? Can you sell life insurance policy to a third party and how much can you expect as the settlement? Most importantly, when is the best time to sell the policy to a third party?

So the question is can you sell your Life Insurance Policy?

It is within your rights to sell a life insurance policy that you no longer need to a third party under the life settlement clause. Ideally, the sale involves transferring your claim over the expected payout to a third party investor in exchange for cash. In effect, the investor offers immediate cash payment (also known as a buyout) and continues paying the premiums up to the time of your passing when they can then claim the full settlement from the insurer. Life Settlement companies like Magna, help you sell your life insurance policy form the comfort of your own home, or over the phone.

Sell Life Insurance Policy How much cash can you expect from the sale?

How much you receive from the life insurance sale depends on a host of factors set out by the third party investor. In most cases, the investor considers such factors as the value of the policy, your current health condition, and age.

The average settlement ranges from 20 to 25 percent of the value of your policy. The subject is nonetheless open to negotiations, and this has seen the settlement value shoot to as high as 50 percent of the policy size. You should, however, note that not every subscribed life insurance qualifies for settlement.

Eligibility for life insurance policy sale

Almost every third-party life insurance investor has eligibility criteria that they use to screen individuals seeking to sell their life insurance. Nonetheless, some of the standard procedures followed by most investors include the fact that you must be above 70 years of age and have a policy value of more than $50 thousand. Most companies also prefer universal, whole, and convertible term life policies.

The regulations are, however, not set in stone. Plus, the stiff competition has forced some companies to accept policies for individuals aged 65 years. Most investors will also overlook the age limit, especially if the insured is terminally ill with a life expectancy of less than two years.

When does settling a life insurance policy make sense?

Non-payments of premiums

Insurance companies may decline to honor a life insurance claim if you stopped or have been inconsistent with paying premiums. Therefore, in the event financial constraints make it impossible to honor the regular premiums, remember that you have the option to sell the policy in a life settlement rather than allowing the insurance company keep the money.

Medical expenses and emergencies

When pressed by large medical expenses that need to be paid up front, you can always count on the proceeds of the settlement. Though saddening, health complications may in actual sense raise the settlement value of the policy where the investors project a lower life expectancy.

How to maximize the settlement amounts that get to your bank

Life policy settlement is taxable under income and capital gains. With the government taxing the settlement, the last thing you need is a broker or insurance agent seeking to dig further into the little left. Maximize the amount of the settlement that gets to your bank account by working with inexpensive agencies, and, if possible, reach out to the investor directly.

Contact Magna Life Settlements to get a free estimate on how much cash you can get from your life insurance policy!

Questions to Ask Yourself Before Lapsing Your Policy

Questions to Ask Yourself Before Lapsing Your Policy - Magna Life Settlements

For a host of reasons, insurance policies that seemed like a good idea during an individual’s middle-aged years can become a burden as that person ages. There are undoubtedly good reasons for a policyholder to shed such an unwanted policy, but what many people don’t understand is that there are other options to lapsing a policy.

If premiums have become unwieldy, or the original beneficiary of the policy no longer needs the funds because of altered circumstances, the first reaction is often to let the policy lapse. What does lapsation entail, and why should seniors consider alternatives that could result in a better financial result? Here are three key questions policyholders who are considering doing away with their life insurance policies should ask themselves:

1. Do You Need The Policy?

The first step, for an individual considering getting rid of an insurance policy, is to consider the cost and future benefit and make a thorough determination of whether that policy is still necessary. Significant changes in income or family structure, in particular, may diminish the efficacy of a policy, especially if the intended beneficiary no longer needs the payout.

2. How Are The Premiums Affecting You?

For seniors, particularly those on fixed incomes with rising health care costs, continuing to budget for insurance premiums might not be the best use of limited resources. Additionally, depending on the structure of the policy premiums can get more expensive as the years go on. Seniors who are discouraged by this burden are often tempted to just stop paying and let the policy lapse rather than considering a more profitable alternative.

3. What Are My Other Options?

Even if policy holders are convinced that they would be better off without a particular insurance policy, they could explore the option to sell their policy before letting it lapse. Lapsation removes the premium burden, but it doesn’t compensate the individual for the money paid out in premiums over the years. Rather than let a policy lapse, more and more seniors are investigating life settlements, which allow for the sale of a policy for cash. Not everyone qualifies for a life settlement, but for those who do qualify, it provides a way of unloading a policy that has become a liability. Find out if you can turn your life insurance policy into asset today by scheduling a call with a Magna life settlement specialist or trying our simple life settlement calculator.

*Comments provided in this blog post are for informational purposes only and should not be construed as financial, legal or tax advice, recommendations or solicitations. Please consult your financial, legal or tax professional with questions related to the information presented, or for advice as to whether a life settlement is right for you.

How To Avoid Feeling Stuck In Retirement

The cost of retirement is higher than ever, creating a pressing need for Americans to find ways to prepare financially for retirement as wisely as possible and use their retirement funds well after they stop working. Everyone knows they should prepare for their retirement years so that they can enjoy that season in life rather than feeling stuck, but some fear that they won’t do enough.

Your Guide to Navigating Retirement with Ease

According to the Retirement Confidence Survey conducted by the Employee Benefit Research Institute, 36 percent of current American workers feel “not too or not at all confident” in their ability to retire comfortably. Additionally, 46 percent reported a lack of confidence in having enough resources to pay medical expenses after they retire, and 58 percent doubt they will have enough money for long-term care.

Guide to Navigating Retirement - Magna Life SettlementsThe key to a fulfilling retirement comes when working people take the long view, making decisions in their earlier years that will lead to financial stability and opportunity down the road. By managing debt and seeking sound financial guidance, Americans can plan ahead to create the kind of retirement they have hoped for.

Debt Management

It is never too early to eliminate debt with an eye toward retirement. The seniors who are getting the most of their retirement today–traveling, investing in their interests and their legacy and keeping a financial margin for health care and other unexpected expenses–are the ones who took care of credit card, home, car and other debt while they were working to maximize their options as retirees.

Magna Life Settlement Calculator

Seeking Sound Financial Advice

Too often, individuals start meeting with a financial advisor when retirement is drawing near, but a wiser move is to develop a relationship with a financial advocate early in your working years so that he or she can help map out your path to a fruitful retirement. When financial advisors are well acquainted with their clients’ financial history, family situation and goals, they will be equipped to customize advice and strategies to optimize their clients’ retirement.

Short-term measures to boost income, like life settlements, are one way to help keep seniors from feeling stuck and provide financial freedom in their later years. Connect with your financial advocate to see if this is the right option for you.

When Families Change, Life Insurance Needs Can Change Too

When Families Change, Life Insurance Needs Can Change TooWhen someone takes out a life insurance policy in their ‘30s, ‘40s or ‘50s, that purchase is predicated on assumptions about the future of the policyholder’s family. But unexpected changes to the family structure can occur over the years, and for seniors those changes might lead to the consideration of a life settlement.

Insurance For Your Family: What You Must Know

The most common family change, with obvious insurance ramifications, is divorce. Often a person buys life insurance, names their spouse as a beneficiary and later gets divorced, voiding the need for a policy that will support the surviving spouse. If the policyholder is over 65 and paying into premiums unnecessarily, a life settlement can turn that situation around and provide a windfall rather than burdensome expenses.

In the same way, a senior who undergoes a divorce and then gets remarried later in life may want to schedule a life insurance check with their broker to guarantee that the coverage serves the needs of the policy owner and his or her new spouse. A new policy with a new beneficiary might not be practical or affordable if the remarriage happens late in life, but that new family could be eligible for a cash windfall through a life settlement that they can enjoy in their retirement years.

Insurance Policy Review

If an insurance policy is structured to benefit children or grandchildren, the addition of family members through birth or adoption could prompt an insurance re-evaluation. Some policyholders, particularly seniors, opt to sell their policies and use the proceeds for college funds or other legacy investments rather than an insurance policy that will pay out after their death. Seniors who create educational funds for their grandchildren can have the benefit of watching those young people take advantage of higher education and make steps toward building their futures.

Life Events Lead to New Insurance Needs

Change is inevitable in life, and changes to families—whether welcome or unwelcome—can create new investment and insurance needs. Seniors with a thorough understanding of their financial options will provide the richest opportunities for themselves and their loved ones, and those facts are available from trusted financial advocates or specialists like the ones at Magna Life Settlements. If you have seen changes in your family and believe that a life settlement could be a better use of your resources than an unneeded life insurance policy, set up a call with a Magna advisor or try our simple life settlement calculator today.

 

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