Global Courant
Have you ever wondered why your life insurance company doesn’t advertise life or senior plans? It’s actually in their best interest not to say a word because they’re making less money as a result of people deciding to go the senior settlement route. But still, what is a senior citizen scheme and how can it be of any benefit to you?
A senior settlement, also known as life insurance, is what happens when you sell your life insurance policy to a third party, such as a bank or similar financial institution. Essentially, these life insurance policies are little more than lump sum insurance payments that someone pays you for the death benefits your beneficiaries would receive from the life insurance company upon your death – only you get this money while you’re alive! Already confused? Don’t worry, senior settlements are only mysterious until you see how simple they really are.
Basically, a company or individual investor pays you a percentage of the death benefits your beneficiaries would receive if you pass away. They clearly can’t pay you what your heirs would receive with a normal life insurance policy because they wouldn’t make any money doing so. In addition, these companies and companies continue to pay the premiums on your life insurance policy until, well, the time of your death. They’re betting on how long you’ll live, so the younger you are when you enter into a senior plan, the smaller the percentage they’re willing to pay on the total of your death benefits. So, what’s in it for you and why should you even consider getting less money for your death benefit after paying those life insurance premiums all these years?
The truth is that many of us buy life insurance when we are younger and less prepared for things like retirement. But as we get older, we honestly tend to need less and less life insurance because we’re generally better able to handle our financial affairs than we were when we were younger. After our death, our loved ones have less to worry about at this point and so you may want to consider “cash in” your life insurance policy. But a senior plan will generally pay out much more than the life insurance company will give you in surrender value. This is because unlike senior or life insurance, the insurance company will pass on the money you paid in premiums, but will most likely not give you any of the money they’ve earned over the years in interest on your premiums. However, a senior plan will give you some of that money and it will almost always be higher than the surrender value paid by a life insurance company.
Senior settlements are not for everyone. But if you no longer need life insurance that may be obsolete and you want to boost your nest egg or just have a little more money to invest for retirement, you should consider a senior retirement plan. Senior or life insurance isn’t as mysterious as you may think and you’ll come out better than if you just cashed in your life insurance policy. Just find out what the surrender value of your life insurance policy is and then shop around for some senior plans and you’ll be very surprised at how much more profitable they are in comparison. And, as with all your other investments, make sure you know the true value of your life insurance policy before you sell it.
The mysterious world of senior settlements
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