Life insurance can be the great equalizer in a world of inequality. Retired couples can statistically bank on the woman outliving her husband 87% of the time. The average female survivor lives to age 93. That means that half of American women will live longer than that! Recently, Susannah Jones lived to the age 116. She was born in 1899, giving her the distinction of being America’s last tri- centurion. But she’s not the oldest documented person in the Guinness Book of World Records. That honor is held by Jean Calment who died in 1997 at 122 years, 164 days. Women generally outlast their husbands and live longer, a lot longer.
Living longer can generally be a good thing if you have wealth and your health. But many middle class widows have neither. When their husbands pass away, they generally lose their spousal benefit in lieu of their husband’s benefit. So if the husband’s Social Security monthly benefit is $2,500 and her benefit is $1,250, she’ll elect to have her husband’s larger benefit, but she loses hers in the election process. They were earning $45,000 a year in Social Security benefits, now she’s earning only $30,000 in benefits. For most middle class widows that’s an economic hardship. And depending upon losing an exemption at the death of her husband, she may also pay more in taxes. It can be a double whammy while she’s still grieving the loss of her husband.
Life insurance can fill in for the reduction in Social Security benefits. It can also pay last medical bills and funeral costs. It can be there when she needs it most, and can give her the financial independence she desires.