Tag: life settlement
The Top 8 Cities for Retirement in the U.S. in 2019
Once you reach retirement age, it’s important that you are able to manage your finances properly. Stretching the dollars you’ve saved may mean you’ll want an inexpensive place to live out your retirement. If you’re looking for U.S. cities with a low cost-of-living, check out our list below.
Where to retire in the United States in 2019?
8. Cleveland, OH
Cleveland’s annual living expenditures total around $36,000. This figure factors in important items such as your housing, healthcare and transportation costs. Frugal spenders who have managed to save a modest amount each year throughout their working lives will have no trouble managing their expenses in this city.
7. Augusta, GA
You can expect to spend $35,781 on an annual basis should you retire in Augusta. In addition to low costs for your basic needs such as food, housing, medical and transportation expenses, there are other reasons to choose this city in Georgia. Relatively warm summer temperatures are a major draw and many current residents report a high happiness index.
6. Brownsville, TX
There are several cities in the state of Texas that make excellent choices for retirement living. Brownsville is one such city, boasting a low cost of living of only $35,461 each year. Because it’s Texas, you’ll also enjoy warm or moderate temperatures all year round. If you want to experience other cultures, you’ll find a large Spanish-speaking community in Brownsville that is eager to welcome newcomers.
5. Toledo, OH
We’re back to Ohio, where you’ll only have to spend about $35,095 annually to enjoy a relaxing retirement lifestyle in Toledo. Groceries for an entire year will only cost you $3,375 and even the highest estimated expense – transportation – comes in at an annual total of $6,814. Current residents report high happiness across various age groups and enjoy access to many of the city’s amenities.
4. Memphis, TN
Memphis offers you warm temperatures and friendly greetings for just $33,859 in annual costs. The city combines a laid-back atmosphere that is perfect for easy-going retirees along with the amenities and upscale venues one might expect from a major metropolitan area. If you’re looking for a slower pace as you enter retirement, but don’t want to sacrifice the modern conveniences of a major urban area, you should definitely consider Memphis as your retirement destination.
3. Jackson, MS
A move to Jackson might be perfect for you if you enjoy distinctive culture coupled with a low cost of living. Annually, you’ll only need to spend $33,676 to enjoy a pleasant lifestyle in Jackson. This, combined with the area’s Southern charm and culture make it an appealing option. Jackson is also currently undergoing revitalization, so you’ll be able to see the old merge with the new during this transformation.
2. Detroit, MI
Detroit is another place where you’ll see history and culture come together with modern innovation. Retiring to this city will only cost you $33,356 each year, which includes everything from housing to transportation. The metro area borders Canada, so you can experience the unique influence of the early French settlers. While parts of the city are sparse, the city is still a modern metropolis with plenty to offer to keep you entertained during retirement.
1. Birmingham, AL
Birmingham tops our list because we’ve found that it’s one of the least expensive cities to live in across all categories. Housing costs are a little higher on average than some other cities we’ve cited here, but Birmingham makes up for that with much lower costs in most other areas. Average healthcare costs for this city are comparatively low, as are the transportation costs. Birmingham capitalizes on this by offering modern, urban areas and attractions at more affordable prices than some bigger cities. Even as you stretch your dollars, you’ll find plenty of opportunities for entertainment or new experiences here.
This list showcases our top eight picks for affordable retirement choices in the U.S. While we’ve given you the best overall annual average costs, keep in mind that these can vary somewhat depending on things like your specific transportation needs (public or private) and your grocery budget. Your personal finance plan may be able to reduce these costs even more.
What Are The Different Types Of Life Insurance?
Life insurance is something that many people don’t prioritize until it’s almost too late. We get busy with the demands of adult life–career, jobs, family–and then something happens to make us question our longevity. It may be time to sign up for life insurance.
While most of us might think term life insurance is the best option, life insurance is something that should be thoroughly investigated to make sure you are getting the most bang for your buck. There are many options available, and spending some time to understand the differences between insurance types will help you choose wisely in this decision that will not only affect you, but your whole family. Here are some types of insurance, with the features of each:
The Two Main Types of Life Insurance: Term Vs. Permanent
We may be familiar with these types of life insurance, but there are several sub-sects within each category that offer different benefits to the policy owner. Before we cover the intricacies of these policies, let’s get an overview of term vs. permanent and what they mean for you:
Term Life Insurance
Term life insurance is considered the most basic type of life insurance policy, because it awards benefits only upon the death of the policyholder. There is no build up of cash value, and after the initial term that is agreed upon when the policy is created, the policy ends. Contract length can run anywhere from 15 to 30 years, with some of the better companies offering a 1-year renewable contract option beyond the initial term. The terms of the contract and the premiums stay the same for the life of the contract. This makes it difficult for the policyholder to request additional coverage when the initial term ends, as they would have to re-qualify for coverage at an older age, with possibly a more questionable health status. In some cases it is possible to convert a term life policy over to a more permanent form of coverage.
Permanent Life Insurance
Permanent life insurance is a policy that remains in effect as long as the policyholder is still alive, and it retains cash value and in some cases, even appreciates in value. While premiums may be a bit higher, there is additional security in realizing that this type of coverage will not, like term life insurance, eventually cease to exist.
The Different Types Of Permanent Coverage
Whole life coverage is the simplest form of permanent coverage, for it allows those who are budget conscious to stick to a premium that remains the same for the life of the policy. There are advantages to beginning a whole life contract at a young age, since lower premiums remain in effect as the policyholder continues to advance in age and possibly developing some adverse health conditions.
Universal life coverage has some of the same benefits of whole life; death benefits are guaranteed pending the death of the policyholder, and the policy steadily grows in value, providing additional security upon maturation. One additional benefit of universal and whole life policies is that they can be borrowed against to pay down debt, to refinance, or to make large purchases, although this is not a practice that most financial advisors would condone.
Variable coverage grows in ways similar to whole life and universal coverage, but the policyholder has the option of taking a portion of his account and investing it in equities that have the potential to grow much larger than a life insurance policy normally would. This could potentially make cash payout at the end of the policy much greater. If you an individual that would be okay with a certain amount of risk to acquire growth, this might be the policy for you.
Survivorship coverage exists for families where it is necessary to insure more than one person. This type of coverage is generally less expensive than holding two life insurance policies. Some policies pay out upon the death of the first family member, while others grow in cash value until the death of the last surviving policyholder. These types of policies are ideal for people looking to maximize their cash growth while minimizing their out-of-pocket costs.
Final expense coverage is typically purchased by seniors ages 50 and above who do not want the burden of their funeral and burial expenses taken on by their survivors. With the average cost of a funeral estimated at about $10,000 today, final expense coverage is a welcome benefit to families already experiencing grief and loss.
No medical exam coverage is a benefit to people with pre-existing conditions that may not be covered by an insurance provider. While this is beneficial to those people, the coverage comes with higher premiums and lower overall benefits than policies offered to people willing to undergo medical exams.
Thanks to the wide variety of options, almost everyone can get the life insurance coverage they need at a price they can afford. Ultimately you will need to determine the best choice for your needs, but knowing a bit more about what is out there will allow you to make an informed decision. There is tremendous peace of mind that comes with knowing you’ve made the right decision for you and your loved ones.
Sell Part of Your Life Insurance For Cash
Many seniors who are informed about life settlements view the sale of their life insurance policies as an all-or-nothing proposition, but policies don’t actually need to be sold in totality. In some cases, a Retained Death Benefit (RDB) offer might better serve the needs of both retirees and their family.
The reasons for entering into a life settlement are varied, but often the sale of a policy is triggered by one of two factors: 1. prohibitively high premiums or 2. changing circumstances that negate the need for the insurance. But there are situations in which individuals still have the need to keep some of their life insurance’s death benefit for their beneficiaries. In those circumstances, a RDB can be ideal.
This solution could work well for a senior who has more than $100,000 in life insurance, since a policy must be worth at least $100,000 to be evaluated for a life settlement. Some policyholders have one large policy, and they might wish to collect cash for part of the policy and retain the rest for the beneficiary of their choice. Others have two or more policies, which might prompt the decision to sell one and keep the other for the sake of the policy’s beneficiary.
What are the advantages of pursing a Retained Death Benefit offer? As in any settlement, the transaction can yield a windfall to help with medical bills or other retirement expenses, but when a senior sells only part of his insurance assets he can still insure that the policy’s recipient benefits as well. In this case, the senior sells the policy and the investor is responsible for the premium costs. Then, upon the death of the insured, the life insurance carrier pays the senior’s beneficiary and the investor collects the remaining portion of the death benefit.
Seniors deserve to have control over their financial situation, and by carefully evaluating their life insurance holdings and needs they can make a decision that will give them the amount of insurance they need while still providing extra income. Life settlements can provide a key tool for individuals looking to optimize their resources during their retirement years and still provide for their loved ones after their death.
Magna’s life settlement specialists stand ready to help advise those looking to strike the right combination of life settlement and maintenance of insurance. Studies show that 90 percent of seniors let insurance policies lapse without being made aware of the life settlement option, and many of those individuals might have opted for a partial settlement if informed. Try our life settlement calculator or schedule a call with one of our specialists today.
Sell Your Insurance Policy and Leave a Legacy
Some older Americans find themselves looking for a way to leave a legacy and give back to their community during their retirement years. With enough money in hand for retirement and long-term costs, these seniors find that contributing their money to a charity of choice a fulfilling way to spend their retirement dollars.
For retirees who want to give their money to a good cause, a life settlement can be a large benefit because of the difference it can make for others. The sale of an unwanted life insurance policy can provide an unexpected source of income to be used for any need.
Examples of some ways life insurance proceeds can help build a legacy of generosity include:
- A significant gift to a charity can go beyond its immediate impact to influence younger generations. When an individual donates money from a life settlement to a worthy cause, his children and grandchildren have an example of giving to others that they are likely to model in the future.
- By liquidating a low-yield life insurance through a life settlement, a retiree can put the money into a high-return fund, directed by an advisor with an eye toward charitable giving. The fund may grow in value and make an even greater impact on selected charities.
- Life settlement funds can touch the lives of family members and make memories at the same time. Some seniors choose to use their windfall for a special trip for the entire family, creating a once-in-a-lifetime experience that the family might not have enjoyed without those resources.
Some individuals pursue a life settlement because they need help making ends meet or paying for needs like medical care, but others find themselves in a comfortable financial situation and wonder if a settlement is worth pursuing. But since a settlement can help meet a charitable goal and make a difference in the lives of others, even those with plenty of money can benefit from the sale of a policy that has become burdensome.
Would you like to learn more about the endless possibilities sparked by a life settlement? Magna’s life settlement calculator will reveal whether you are a good candidate for a settlement, and a conversation with one of our specialists will help answer your questions about the criteria and the process. Contact us today.
Am I eligible for a viatical settlement?
You may be eligible for a viatical settlement if you have an in-force life insurance policy that you’re willing to sell in exchange for a one-time payment. There are companies that specialize in buying life insurance policies from individuals who longer need or want their policies. In such an arrangement, the viatical company becomes the owner and beneficiary of the policy, and the buyer becomes responsible for premium payments. After the sale of the policy, the original owner no longer has any obligations or claims relating to the policy. Once the insured person dies, the viatical company collects the death benefit.
Does a viatical settlement make sense?
A viatical settlement does not make sense for everyone, but for individuals in certain situations, it could provide a much-needed infusion of cash to help with medical or other expenses. If you have a life insurance policy that you’re sure your beneficiaries will not need to rely on, and you are in need of a lump sum of money, a viatical settlement might be suitable. It’s important to understand that the amount you receive in exchange for your life insurance policy can be significantly less than the policy’s death benefit. You’ll also want to discuss any potential tax implications with your tax advisor.
How is my payout determined?
Under a viatical settlement, your payout is determined by the amount of the policy’s death benefit and your expected lifespan. Generally, the longer you are expected to live, the lower your payout will be. This is because the viatical company will have a longer period during which they will make premium payments on the policy – reducing their profitability. You may be required to have a medical examination in order for the viatical company to estimate your expected lifespan.
Choosing an Accelerated Death Benefit or a Viatical Settlement
Some life insurance policies have an accelerated death benefit, which allows the insured person to receive part of the policy’s death benefit while they are still living. Eligibility is usually reserved for situations where the insured person is suffering from a terminal illness. If you’re in this situation, an accelerated death benefit may be optimal, because you are able to retain ownership of the policy while receiving financial assistance. If your policy does not have an accelerated death benefit, or if it does include one and you’re not eligible to activate it, a viatical settlement may be a better option.
Want to learn more about Viatical Settlements? Contact Magna Life Settlements today!
How To Pay For A Senior Living Community With Your Life Insurance Policy
It’s a common refrain: seniors who have always thought they would want to stay in their home as long as possible have a change of heart when they realize how convenient and enjoyable a senior living community might be. Oftentimes, however, there is a high, one-time entrance fee that can range from tens of thousands of dollars to hundreds of thousands of dollars. These entrance fees are used for future long-term care costs. Additionally, monthly prices for such facilities can range from $1,500 to $6,000.
Seniors may be drawn to retirement communities for different reasons—the availability social connections and arts and enrichment activities, the convenience of meals and other services, or the understanding that the regular upkeep of a house has become too burdensome. But since studies show that only about 3 percent of Americans buy long-term care insurance, the desire to move into an all-inclusive community can also bring plenty of financial uncertainty. Even those who have engaged in careful retirement planning are often unprepared for the mounting expenses, and long-term care becomes more expensive every year.
Enter the life settlement, an option for seniors who are holding onto life insurance policies they no longer want or need. By selling an unwanted policy for a payout larger than the surrender value, people over 65 can use the funds to help pay for the entrance fee and/or monthly costs of a retirement community. Life settlements can be the answer for those who find that their monthly income is insufficient to pay for the living situation that best suits their needs in their golden years. A life settlement serves seniors financially two ways: 1. by providing a sum of money to help meet expenses and 2. by removing the burden of paying regular insurance premiums.
It’s easier than ever for seniors to research life settlements and, if they qualify for a favorable sale, to walk through that process with a life settlement company like Magna. The first step is to use Magna’s simple life settlement calculator tool to determine initial eligibility, and from there an individual can schedule a phone call with one of Magna’s settlement specialists to learn more about the settlement offer and the steps to convert life insurance into a windfall.
If your senior living situation is less than optimal and the lack of resources has become a barrier to moving into that retirement community you have been researching, find out today if a life settlement might be the answer. Every day more seniors are learning that their old life insurance policy has hidden value that can improve their lives now.
Magna Life Settlements Scholarship
Magna Life Settlements Scholarship is seeking to sponsor the growth and development of a student currently enrolled, or is enrolling into a four year collegiate program. This year we will award one $1,000 scholarship to an outstanding student who is interested in pursuing a career in finance. The deadline for submission is June 1st 2019:
To be considered for the Magna Life Settlements Scholarship you must:
1. Be a high school senior or currently enrolled.
2. Plan to attend a four-year college or university in the fall of the year following high school graduation.
3. Plan to pursue a bachelor’s degree in finance or related field.
4. Demonstrate a passion for finance.
5. Demonstrate leadership at school or in the community.
6. Have a cumulative GPA of 3.3 or higher.
7. Require financial assistance to attend college.
How to Apply
To apply for the Magna Life Settlement Scholarship, email the following documents to firstname.lastname@example.org:
1. Two letters of recommendation
At least one letter must be from a faculty or staff member at your school. Letters of recommendation should be original and should not be duplicates of college recommendation letters. (Letters must be on letterhead.)
Your résumé should include the following information:
—Extracurricular activities (school and community related)
—Honors and awards that you have received (if possible, include awards that are finance related)
3. Picture of yourself
Include an official “sealed” copy of your current academic transcript. (Unofficial copies will not be accepted.)
5. Two essays
1. In no more than 500 words, describe how you plan to engage in the technology industry in your future career. (If you have done exemplary work using technology during high school, please describe that also.)
2. In no more than 250 words, demonstrate your financial need for this scholarship.
Sell a 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 policy? Can you sell the 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?
Can you sell your Life Insurance Policy?
Yes. It is well within your rights to sell a life insurance 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 and continues paying the premiums up to the time of your passing when they can then claim the full settlement from the insurer.
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.
Use our Life Settlement Calculator today for a free quote on how much your Life Insurance Policy is worth!
Help Your Clients Navigate Healthcare Finances
For seniors, health concerns often spring up unexpectedly, and the rising and prohibitive costs of quality health care lead to a burdensome financial situation for many people in their retirement years. An AARP study estimated that 65-year-old couples who retired in 2017 would face $275,000 of health care costs during retirement. When health expenses are a concern, seniors often turn to their financial advisors to help them navigate their limitations and choices.
Advisors must be adept at offering money solutions that are custom-built for a client’s particular needs, and the situation of a senior with health-care concerns is certainly different than a young married couple looking to start a college fund for their future children. So what are some principles that can guide advocates who are seeking the best financial path for their senior clients?
Make sure funds are accessible. A young investor with a long view toward higher education or retirement might be happy to invest in the stock market or another vehicle with a promising rate of return over a number of years, but seniors need resources that they can access easily when needs arise. A life settlement is one option that can provide quick funds for healthcare bills.
Understand the full picture. Does the retiree you are advising have long-term care insurance? Do he and his spouse hope to live in a retirement community or stay in their home as long as possible? Are they committed to maintaining investments to help their children and grandchildren? Financial goals and needs change over time, so an astute advisor will evaluate periodically to make sure a client’s portfolio fits his current situation.
Stay informed about new and innovative options. Even retirees who invest wisely during their working years can be hit with unexpected expenses, so advisors have a responsibility to stay informed on options that can increase their income in their later years. In addition to low-interest, easily accessed funds and the maximization of benefits from programs like Medicare and Social Security, advisors could offer a windfall to clients by providing information about life settlements. When a life insurance policy is no longer meeting a senior’s needs and the premiums are burdensome, a life settlement could be the optimal solution.
Advisors looking to give the full life settlement picture to their clients can review Magna’s settlement criteria here, or call a Magna specialist at 1-888-996-2475 to learn more.
The Hidden Financial Asset Most Retirees Don’t Know They Have
Even seniors who have planned carefully often find that the costs of retirement add up, forcing some retirees to cut corners severely on everything from health care to travel to legacy expenditures like helping with college tuition for grandchildren. Everyone over the age of 65 wants the freedom to create a retirement that meets their needs and those of their loved ones, but to fulfill those hopes they might need to tap into a little-known resource that could turn a dead-end account into an asset.
Life insurance is property and therefore can be sold in a transaction known as a life settlement, but 90 percent of seniors let their policies lapse instead. Instead of lapsing a policy, seniors should first find out how much value their policy holds. A quick example of the hidden value within a life insurance policy: a 73-year-old man who chose to sell his policy learned that his $5 million policy would yield $1.55 million through a life settlement. If had surrendered the same policy back to the insurance company, he would have received just $210,000.
Here are some surprising facts about the hidden value of your life insurance policy:
1. Even though the life settlement industry has been around for more than 25 years, many seniors don’t know that they have the option of selling their policy because insurance companies haven’t been obligated to tell them about it. Thanks to state regulations, that’s changing.
2. This year alone, Americans are expected to make $3 billion in life settlements, putting money to work that would otherwise be lost if the policy was allowed to lapse.
3. The amount of a life insurance payout is directly related to two factors: the policy holder’s overall health and the cost of the original policy. A life settlement calculator can help a policy owner determine if their life insurance has any value.
4. The cash from the sale of a life insurance policy can be used to help fund long-term care, medical treatments, travel or family activities.
5. The life settlement industry is regulated by each state’s department of insurance, and eight states, with two more pending, have recently passed laws requiring insurance companies to disclose the life settlement option to their policy holders.
6. Seniors wishing to explore life settlements can start by calculating the payout value of their policy with Magna’s Life Settlement Calculator. The potential to turn a no-longer-needed insurance policy into much-needed cash might surprise you.
If you or a loved one is nearing retirement age or already navigating life through the senior years, it’s crucial to know the options surrounding old insurance policies. Life settlement companies like Magna stand ready to answer your questions and help you decide if selling a life insurance policy is right for you as you seek to optimize your retirement years.