Insurance safeguards your income and assets, and saves you from large out-of-pocket expenses which are side-stepped whenever you make a claim on one of your insurance policies. In your retirement years, you will still have to pay premiums for automobile and home insurance policies unless you have decided to give up both your home and car in favor of assisted living and public buses. With regards to disability insurance, think: Social Security. Yes, Social Security isn't all that bad! Remember that you can retire under disability at any age under Social Security provided that you have worked and received ten years of credit and have been covered under the system for at least five years.

      When it comes to the types of insurance available, health insurance is of course vital and is needed no matter what. You must understand that it has nothing to do with life insurance though - which is a different ball game altogether. A crucial part of many estate plans, life insurance can be used to leave much-needed income to your survivors, provide for your children's education, pay off your mortgage, simplify the transfer of assets, replace wealth lost due to expenses and taxes following your demise, and also to make gifts to charity at relatively little cost.

      Life insurance protects your survivors financially by replacing your lost income. So if you don't want to spend sleepless nights in that cozy grave you're aiming for, make sure your life insurance coverage is intact throughout your Golden Years. Buying life insurance now - just to ensure that your survivors don't suffer financially after you pass away - would go a long way helping your family to maintain their lifestyle and live comfortably for years to come. After all, they do deserve some sort of reward for tolerating you for so many years! Yes, you owe them a life insurance policy.

      In most cases, life insurance proceeds are available very quickly, which means that your family would have the cash to meet their short-term financial needs. When life insurance proceeds are left to a named beneficiary, they don't have to pass through the process of probate. In other words, your family will not have to wait until your estate is settled to get the money for the payment of bills.

      If, however, you don't buy life insurance now and assume you're being quite smart just leaving your assets to your family in your will, those assets won't be distributed until after the probate of your estate is complete. Probate typically takes six months or longer and during this time your survivors won't have the financial flexibility that a life insurance policy would provide in this difficult time. As your survivors curse you behind your back, that life insurance salesman with the blue shirt and striped tie will roll with laughter recalling the times you slammed the door shut when he arrived at your doorstep over and over and over again.

      You should talk to your attorney before buying life insurance - if we have convinced you to welcome that life insurance salesman in, that is. Your attorney will be able to enlighten you about potential tax consequences of your purchase. (Let there be light!) If you are leaving behind a taxable estate worth less than a certain amount ($1.5 million in 2004-5, under the applicable exclusion amount), your survivors won't owe estate taxes on a life insurance policy left to them. But if your estate happens to be larger than that, your attorney should be able to propose and put a plan in place to help minimize the estate tax burden on your family (now remembering you with much fondness). Let your survivors know (in a folded letter lying on top of your chest of drawers) that if they receive the insurance proceeds in installments and interest is paid, the interest portion of the payment generated after your death is taxable income. Such great care on your part may very well begin a family legacy of thoughtfulness, and you'll have only us to thank!