Death planning guide: are over-50s plans worth it?
Money Savings Expert Martin Lewis has compiled a checklist of 20 things you need to consider when planning for the financial well-being of your family (it’s on his website). The check-list includes tips on wills, inheritance tax, funerals and setting up power of attorney. Our last post addressed the gift of organ donation. This post looks at the ‘over-50s insurance plans’ to see if they are really worth it.
Over-50s plans promise to pay a fixed lump sum on death, with no need for a medical, which you could then use to cover your funeral costs.
While these sound like an easy way to protect your loved ones, there's a crucial term in the small print: "Premiums are payable for life and you could pay more in than is paid out on death."
Because the amount it pays out is fixed, if you live a long time you may end up paying more for the plan than you'd ever receive.
So if you've got a plan already, don't just cancel. First, do some sums to see how good or bad these plans work out for you. For full details see MSE’s Over 50s Life Insurance guide.