Either way you cut it, living too long or dying too soon is a bummer for all of us. Either option has the potential for financial devastation. Dying too soon is the easy part for you. You’re gone…no more worries for you. However, your family is left holding the bag, and without your help to pay the bills your family’s future will be perilous. If you own a business your too soon death causes even more issues. Think about it.
Living too long is another issue. Better healthcare and lifestyle allows us to live longer, much longer on average, than our parents and grandparents. A new retiree can look forward to thirty or more remaining years, good news for many of us. Potentially running out of cash to pay the bills in our later years is the bad news. (If you don’t own one already set up an IRA now.) Compounding the issue is the possibility of declining health leading to the need for at home care or care in an assisted living facility.
The good news for you is that you may employ insurance to guarantee cash flow when it’s needed the most…life insurance to hedge dying too soon…long term care insurance to pay the bills for at home care or care in an assisted living facility later. Premiums for both are less when you buy it now, currently and over your lifetime, rather than putting it off until later.
On the living too long side of the question, whole life insurance provides instant cash as its death benefit plus it can provide needed cash to you after it has been in force for a number of years via its cash value, thus augmenting your retirement income stream.