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Once your children have left the nest, a lot of things willchange. You will find your grocery list looks a lot shorter, yourelectric bill a lot brighter and your water bill requires fewerliquid assets to pay it each month. But what does that mean foryour life insurance?

Should your life insurance coverage look different when you nolonger have kids in the roost? The answer is: it depends.

When you initially purchased your life insurance policy, you determined thedeath benefit that best fit your needs at that time in your life.Your death benefit may have included enough funds to pay off yourmortgage, pay your children’s tuition costs, pay off credit cardand personal debts, and generally provide for your family when youno longer could. But how much of that death benefit is stillnecessary now that the kids are out of the house and on their own?The answer to this question depends on several factors.

1. What is your current debt? If your debt is the same or morethan it was when you initially took out the life insurance policy,chances are your death benefit is still on track. Many people evenfind their debt increases when their children go away to collegebecause they use the equity in their home to help pay theirchildren’s tuition and living expenses.

2. How do your retirement funds look? If you have been lax aboutputting enough away for retirement to actually meet your goals, orif you are still trying to recover from the great recession of2009, then your spouse may need the money from your life insuranceto support him or her during retirement if something were to happento you.

3. Has your child really finished school? If your children haveyet to graduate from college, or if they plan on getting a graduatedegree, then you may want to maintain your coverage, or evenconsider more.

4. Would your family benefit from a life insurance trust? Ifyour spouse has no need for some or all of your death benefit, andyour children are done with school or have scholarships, you mightconsider keeping your death benefit intact and creating a trust forthe funds. The trust can be used to fund your children’s weddings,your spouse’s long-term care needs, your grandchildren’s tuitions -just about anything you can think of – if something were to happento you.

5. Will your family need help paying estate taxes? If yourestate will be subject to estate taxes after your death, then yourlife insurance benefit can help offset those expenses. Lifeinsurance death benefit proceeds do not go through probate if theyare left to a named beneficiary.

So remember, you may be able to reduce your life insurancecoverage after your children leave home, but you should always makesure you examine every angle of potential financial need before youtake that step. You can call the life insurance professionals atSBLI ( at 888-GET-SBLIto request a free coverage review. They will be happy to reviewyour current needs and assess those needs against your currentcoverage. And if you find you need additional coverage (which oftenis the case), you may want to consider their very affordable terminsurance or their competitive whole life insurancepolicy, which provides cash buildup inside the contract, inaddition to the life insurance coverage.

SBLI and The No Nonsense Life Insurance Company are registeredtrademarks of The Savings Bank Life Insurance Company ofMassachusetts, which is no way affiliated with SBLI USA Mutual LifeInsurance Company, Inc. NAIC # 70435. SBLI products may not beavailable in all states.

Courtesy of ARAcontent

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