If you’re between the ages of 50 to 59 years old and considering life insurance, you’re going to require some special guidance.
… it’s not as easy as just getting a quote and applying to the #1 priced company.
A few special considerations for individuals over 50 are:
- the type of life insurance you actually need
- health concerns / approval
- limited availability of longer terms like 25-30 years
You should understand that the advice an agent would give a 35 year old in perfect health is completely irrelevant to you.
Not to worry…
You’re in the perfect place!
In this guide, we’ll help you navigate the important considerations for life insurance in your 50’s, help you determine which type of coverage you need, and show you sample quotes at various amounts.
This will likely be the LAST policy you ever buy, so we need to get this right.
Quick Guide to Life Insurance for 50 – 59 Years Old
- Life Insurance Challenges in Your 50’s
- What Type You Should Buy (based on your goals)
- Types of Coverage Available
- Sample Quotes
- Notes for 51 – 54 Year Olds
- Savings Tips
- What’s My Next Step?
At Huntley Wealth Insurance, we specialize in understanding and meeting the life insurance needs of individuals ages 50-59.
As mentioned in the introduction, you’re at a unique age with the following special considerations.
#1 – Health
For most of our younger clients, health rarely gets in the way of finding affordable life insurance.
… but we do start seeing some health concerns with our clients in their 50’s.
Your first and most important lesson if you have any health concerns is to use an experienced, independent age.
Every company treats a particular health concern differently. Some are more lenient on, say, diabetes, than others. An independent agent’s job is to shop the market for the company that will be best for YOU and your particular health concerns.
So, rest assured, whether you are coming to us as a healthy, non-smoker, or if you have pre-existing medical conditions such as diabetes, previous bouts with cancer, heart troubles, weight issues or are a smoker, we are experts at helping you find the most affordable premiums from the highest rated insurance companies.
#2 – The Type of Life Insurance You Actually Need & Limited Options as We Get Older
Before discussing the type of life insurance you need, you first must understand the following considerations as we get older. They are both important for you deciding on the type of insurance you’ll buy.
- Insurance companies have max ages for every term policy they sell – Typically the max age for 30 year term is 55 with most companies, although we have access to at least one company who will issue 30 year term up to age 57. So if you’re in your early 50’s you can still get 30 year term. It is not available at 58 or 59. However, you can still use a similar product to a long term called guaranteed universal life, and structure it to cover you to age 90, and the pricing is very competitive, and less than half the price of whole life. Even if you’re in your early 50’s however, and yo can still qualify for the longer terms, the next point is critically important to you.
- You need to think 10-20 years in the future – We see a lot of clients in their 50’s who have owned 2 or 3 policies in their lives. Maybe they bought a 20 year term in their 20’s, and when that expired, they bought a 10 year term, and now that is expiring. You really need to think ahead now. If you get a 10 year term at age 57, for example, and you still need coverage when it expires at age 67, your options will be very limited. At 67, you can only buy 10 and 15 year term, and it will be expensive. If you’re 57 and buy a 20 year term, it will expire when you’re 77, and you’re out of options at that age, except 10 year term or a permanent policy. (… and that’s if you can still qualify health-wise)
Having said this, you might not need a long term.
Long terms cost more.
The typical life insurance purchaser is buying it for income replacement – money for his or her spouse to replace lost income. Here are a few more:
- Income Replacement – You’re still working and want to leave your spouse, partner or children a death benefit.
- Estate Planning – You may need to add liquidity to an estate filled with real estate or business holdings, or you may need the insurance to pay for estate taxes. For estate planning, click here.
- Inheritance Purposes/Invest in Yourself – You don’t care how old you are when you pass. You want to leave something to your family, and can do it in a tax efficient, low cost way using life insurance.
- Business Insurance – You may want to cover outstanding business expenses, responsibilities and obligations. For business cases, click here.
- Trust Planning – Common uses are to fund an AB or Bypass trust, or an Irrevocable Life Insurance Trust.
Matching Types of Coverage with Insurance Needs
If your goal is income replacement, you probably only need a 10 or 15 year term.
… or perhaps you plan to work for the rest of your life. You still might not need a long term. If you are paying down your debts, investing for the future, you might look 10-15 years into your financial plan and find there is no need for coverage.
We only recommend a longer term in your 50’s if:
- you are not retiring anytime in the foreseeable future
- you want coverage after you retire (even if you don’t need it)
- your goal is to “invest in yourself” and create an estate with an excellent ROI (see our Wise Investment Calculator)
- to cover a long-term debt like a 30 year mortgage
So don’t let an agent talk you into a long, expensive term unless you actually want or need one. Most of our clients in their 50’s can get away with a 10 or 15 year term. Here are some sample 10 year rates.
10 Year Level Term Life Insurance Quotes Healthy Male, Age 50-59 Years Old
Age $100,000 $200,000 $300,000 $400,000
50 Year Old Male $14.15 $25.43 $28.56 $37.75
51 Year Old Male $15.06 $27.19 $31.43 $40.92
52 Year Old Male $16.05 $29.30 $34.57 $44.79
53 Year Old Male $17.13 $31.59 $38.00 $49.37
54 Year Old Male $18.31 $34.41 $41.75 $55.65
55 Year Old Male $19.60 $38.63 $45.83 $60.28
56 Year Old Male $21.01 $40.74 $49.94 $65.91
57 Year Old Male $22.54 $44.44 $54.40 $71.90
58 Year Old Male $24.20 $48.66 $59.23 $78.98
59 Year Old Male $26.28 $52.56 $65.29 $87.06
*10 Year Level Term Life Insurance Quotes – premiums for male, nonsmoker preferred plus rates valid as of 4/15/2016 are subject to change.
If you do need insurance for longer than 10 years, however, try to lock in your term for as long as you possibly can, so you can avoid trying to get a new policy in your 60’s or 70’s, as we discussed above.
Here are your other policy options and savings tips:
1. Guaranteed Level Term – 10, 15, 20 or 30 Years
Term life insurance is the lowest priced type of life insurance.
Term life insurance does not:
- build cash value
- pay dividends
- if you surrender the policy, it doesn’t pay you back anything (unless you buy a return of premium policy)
Term life insurance offers guaranteed level premiums and death benefit for a set period of time such as 10, 20 or 30 years. After the initial term expires, the premiums tend to increase dramatically. (10-20x the original premium)
That’s why we always say you should lock in your coverage for as long as you need life insurance.
For example, a 54 year old male buys a 15 year term life insurance policy. His premiums are guaranteed to stay level until he’s 69. Many people in their early fifties may only need a 10 or 15 year term life insurance policy because they are nearing retirement and no longer need the coverage. But if he needs it longer, the premiums will increase in policy year 16 substantially. But that’s ok because this individual can let his coverage go at this point if he no longer needs it. There are no penalties for surrendering your policy at any time.
I speak badly about the renewal option (what happens after the level term), but it can be helpful.
Let’s say a 51 year old purchases a 10 year term policy. At the end of the 10 year term, the policy does not just cancel itself. The 51 year old, now 61, will be offered a renewal rate, which will probably be too high to pay. He’ll probably let the policy go, but at least he will have the option to keep it without proof of insurability.
So if at 61 he has a terminal illness, he’ll be glad to pay the increase premium.
Overall, though, you want to try to match your coverage needs with your term length.
That’s why it doesn’t matter if you’re 51 or even 57 years old; you should buy a term policy for a length that matches the amount of time you’ll need coverage. You don’t want to buy a 15 year term policy at age 53 if you just refinanced your home and need coverage for the next 30 years to cover your mortgage.
In order to find the best quotes for life insurance at 50, you need to understanding the different types of policies available to you. Which type of life insurance is best at age 50? In my experience, 90% of individuals only need 10, 15, or 20 years of term life insurance coverage.
2. Whole Life Insurance & Guaranteed Universal Life Insurance
Some 50 year olds need a more permanent answer.
Perhaps you are receiving or planning to receive a pension or social security that does not have survivor benefits and your spouse will depend on that income. Term won’t work here.
For others, you may just want to leave an inheritance to your spouse or children, so your life insurance needs have nothing to do with income replacement. In those cases, you need permanent coverage.
There are also those affluent families and individuals who have sizeable estates, who need life insurance to pay estate taxes to Uncle Sam. That situation also calls for a permanent solution.
In all these examples, I recommend a policy that will cover you for your whole life called guaranteed universal life to age 120, which is very similar to a term life policy for the rest of your life. You get the lowest cost without any cash value build-up. In our quote box, just choose the lifetime option.
We do not sell whole life insurance.
Remember that life insurance in your fifties isn’t as easy as pulling a quick quote and seeing who offers the best “quoted rate.”
… you still have to qualify.
That’s why you want to work with an independent agency like Huntley Wealth… because we know which company will approve you at the best heath rating, and that is the key to the lowest rate.
Having said that, it’s good to see ballpark rates.
Here are some sample life insurance rates for a healthy male age 50, who is also a non smoker for 10, 20 and 30 year term life insurance with $100,000 to $1 Million in coverage.
Term Length $100,000 $250,000 $500,000 $1,000,000
10 Year Term $14.15 $23.80 $41.73 $74.82
15 Year Term $18.99 $33.19 $60.28 $110.20
20 Year Term $22.89 $42.58 $77.99 $145.95
The quotes above are monthly and assume preferred plus rates for a nonsmoking male age 50, as of 4/15/2016 and are subject to change. If the insured is a woman and all else is equal, the premium would be a bit less expensive.
If the man age 50 takes some medication for well controlled blood pressure, cholesterol or mild anxiety the quote may be more expensive. For a 50 year old, standard non smoker seeking term life insurance, select “regular” on our instant quote form.
Some common high risk medical issues that could drop the applicant even further down in terms of ratings could be type 2 diabetes, obesity, a history of heart disorders such as replaced valve, coronary artery disease or the need for a pacemaker.
Please be aware that life insurance for cigarette smokers is also more expensive.
1. First, What are Your Life Insurance Needs?
By now, you’ve probably built up some equity in your home or maybe you’re close to paying off your mortgage. Your children have grown up and might be in the process of completing their education or are already off on their own.
… so perhaps you don’t need as much life insurance as you think.
At this time of your life, it is not uncommon for a man or woman who is 53 years of age to already have one or more grandchildren. As you are well aware, it can be a bit of a struggle these days for young families to get their roots planted and their financial nest egg underway.
2. What Type of Life Insurance Should I Buy?
My advice in your early fifties doesn’t change too much from my general advice above.
Having said that, you do need to consider a few things.
Your children may now be (or are soon to be) independent, and if you pass away, they may not rely on your income.
Social security is only about 10 years away for you if you’re in your early 50’s. SS does pay out survivors income to widows, and is currently paying out to over 5 million people. Can you get by with just a 10 year term?
If you’re just looking at buying life insurance as some form of income replacement, or just to get yourself covered for the short term then your best bet is to buy term life insurance. You can see from the samples provided how inexpensive term life insurance can be for someone between the ages of 51 – 54.
Questions to Examine Your Current Circumstances
- Do I want to replace lost income?
- What debts will my family face should I die suddenly?
- Do I want to leave a legacy for my spouse, children and/or grandchildren?
- Do I want my family covered until social security kicks in?
- Will I need to cover my mortgage?
As you can see there are plenty of reasons why someone who is between 51 and 54 years old might consider life insurance.
3. Why Term Life Insurance & How Expensive is It?
Term life insurance is very inexpensive, and it’s easy to get if you’re a non smoker and in relatively good health. Even if you’re not, it’s still a great buy. If your health isn’t the best and you smoke we can find you the most affordable rates available. Keep in mind, the earlier you purchase life insurance, the better. Life insurance at 53 costs about 8% less than life insurance at 54.
Term life insurance is without a doubt the most convenient and affordable to buy. If you only need the insurance for say 10, 15, or 20 years, then term life insurance is the way to go.
You can figure out the amount you need and the length of period you will coverage for and go from there.
Remember, regardless of your current age and health status, it is possible to get the life insurance coverage you need.
4. Cost of Insurance Spikes in Early 50’s
If, however, you need a policy that covers you for life, I recommend you buy it now!
Insurance prices really start to spike when you hit 50. The price goes up about 4-6% in your 30’s and 40’s but then increases about 8% every year you wait in your fifties. So if you do need long term coverage, I recommend buying it now while you can still get the best rate available today.
Below is an example.
An example of your premiums changing substantially each year you wait is the following:
I had a 52 year old delay his application a few months after he turned 53 years old. His premium for a 20 year term with $250,000 coverage, went up from $592 per year at age 52 to $642 per year at age 53. That’s an 8% increase! The longer you wait the higher those numbers climb.
So if you’re in your early fifties, say 51 years old or 52, you can expect about an 8% increase for each year you put off buying life insurance. Whereas if you’re in your late fifties, say 58 or 59 years old, you’ll pay approximately 10% extra.
The lesson is to buy now. Even if you can’t afford as much coverage as you want, you can always buy some now, and add on later, if you can.
I have already stated that one of your problems applying for life insurance in your 50’s is you may have a few health concerns.
So my first tip to finding low cost life insurance with health impairments would be to apply for coverage with the company that will be most understanding of your unique health history.
Not sure who the best company is for your unique conditions?
Of course you don’t know!
That’s why you need an independent agent.
Don’t use a “captive agent” who only has access to one company. These are agents like Farmers, State Farm and New York Life. You need an agent who knows the marketplace and can shop for the best deal for YOU.
My second tip is to consider buying 2 policies instead of one.
“Excuse me?” you say.
“Wouldn’t that be more expensive?”
What I mean is you can actually save 10-15% by splitting up your coverage into 2 policies at different term lengths.
For example, if you needed $1 million of coverage, and want to save money on it, instead of buying 1 policy for 30 years, instead buy a $500,000 policy with a 15 year term and a $500,000 policy with a 30 year term.
You can download my ebook and learn more about this strategy here.
My third tip is to use an Income Provider Option.
Very few companies offer this, but we have one who does, and it can save you 5-40%.
You’re probably familiar with the fact that life insurance pays out a one-time lump sum upon the death of the insured.
Well… If your goal is to provide income to your spouse or perhaps a child, why not provide that death benefit to them over a period of 5, 10, 15, or even 20 or 30 years?
We have a carrier that allows you to do this, and substantially reduces the premium.
For example, it costs about 15% less to have $50,000 paid out per year for 10 years than to have a $500,000 lump sum paid out!
Again, you can download my savings ebook, and learn more about this strategy.
Life insurance is an important decision and we, at Huntley Wealth, can help you find the best possible rates into your 50’s. We can access and research dozens of companies.
If you have health concerns, don’t let that dissuade you. We can give you valuable advice and help you to find a policy that suits your individual needs.
To request a quote, simply fill out the form on the right or call us at 877-443-9467.