my husband is 48. He just retired and we need to buy life insurance within the next 4 months. What kind of insurance policy should we get?
Im 45 and have a 401k.
We are both healthy and non-smokers.
Term or Life? what is the difference?
It really depends on a lot of other factors. How much money you need every month, how much debt you have, how many dependants you support (and it's not just kids, do you have an elderly parent you may need to provide for?).
Generally, once a couple have grown kids that they aren't financially supporting any more, they don't need as much insurance, or may not need it at all. By the time you're retired, you should be "self insured", meaning you have so much in retirment savings, pensions, etc. and little to no debt (paid off house, paid off cars, no CC debt) that you don't need insurance.
Assuming you still have kids that are aproching college or are in college, and you still have a mortgage and some other debt, some sort of term policy is likely a good idea. Term insurance is for a set amount for a set term, usually 20-30 years. At your age, 20 years should be enough time, only you can figure out what you'll need. Suze Orman says you should have a big enough lump sum that if you invest it at 5% return a year, you can use that return to replace all or most of the lost income of deceased person. Others say you should have enough to pay off all the debt and college for the kids, and have enough left over to carry you through 5 years or so until you're back on your feet. It all depends on what you feel comfortable with, and what you can afford.
Stay away from Whole Life (also known as Universal Life and a few other names). It's more expensive and even though agents advertise it as an "investment", it's a really bad one. The only good thing about it is that it coveres you forever, unlike term that expires after 20-30 years. But as I said earlier, by the time you're retired, you really shouldn't need insurance at all, so it's still just a waste.
