Thinking about your own mortality is depressing enough. Thinking about your parents’ mortality might be even worse. However, it’s a fact of life that everyone dies and I think that we can all agree that it’s better to be financially prepared for it than to pretend it will never happen.
So, what does this financial preparedness entail?
Plenty of things, of course, but if your parents don’t have life insurance or funeral insurance in particular, then this could be a good time to discuss getting some. Here are a few factors to think about when deciding whether your parents need life coverage.
You rely on your parents financially
While most adults prefer to be financially independent and not have to rely on their parents for money, certain circumstances can prevent this from happening.
If you are out of work and can’t get a job, or if you are divorced and are having trouble getting back on your feet, or if you just don’t get paid enough to make ends meet, you could be relying on your parents to help you out financially.
If your parents were to die, would you be able to cope financially? If the answer is no, then life insurance could be a good option.
Your parents take care of your kids
Child care is expensive. Grandparents often take care of their grandkids to save on childcare costs. If your parents look after your kids so you can go to work, it’s worthwhile thinking about how much you would have to pay in childcare costs if your parents were no longer around.
A life insurance payout could help to cover those costs.
The loss of a pension
When a couple retires together and splits expenses (carpooling, for example), their combined cost of living is lower than if they were to retire separately. If your parents both have pensions coming in, they might be able live comfortably.
However, if one of your parents were to die, would the other be able to cope financially with just that one pension? Life insurance could help to cover the loss of that too.
Medical treatment can be expensive. If your parents get sick, would they or you be able to cover the cost of the medical treatment? Some life insurance policies offer early payouts on diagnosis of terminal illness, helping to cover that very expensive end-of-life care. Alternatively, the life insurance payout could also help to cover medical costs.
Covering funeral expenses
Funerals aren’t cheap. Coming up with the money to pay for a funeral could add stress to what presumably is already a very emotional time. Life insurance or funeral insurance can help to cover funeral expenses, making the process less stressful.
There are many options for older people looking for life insurance. Do some research to find out what’s available, and talk to your parents to discuss their options. Click here to find out what AAMI has to offer.
Is this tough topic something you’ve brought up with your parents? Was it awkward?