Given the tough economic times, everyone is looking for a way to make a little extra cash. It may mean working extra hours or even picking up a second job. But for many senior citizens, these options either don’t exist or are extremely unfavorable. Re-entering the workplace after retirement is no easy proposition. It can be an extremely unattractive one, too, for people who have worked their entire lives looking forward to the joys of retirement. A third option that is becoming increasingly more popular is selling one’s life insurance policy.



Reasons for Selling



While everyone is feeling the pressure from the economy, there are plenty of other reasons for selling your life insurance policy that makes it an attractive proposition. It could be that the policy is underperforming and you are simply looking to cut your losses as you would on any other investment. Along the same lines, you may find the payments have become over burdensome and simply not worth it to you anymore. Divorce could play a role or maybe you actually want to update your coverage to another provider. Medical bills could make for an immediate need for cash on hand as well.



How It Works



The transaction for a life insurance policy is simple. A third party buys one’s life insurance policy for a lump sum and then that party receives the proceeds when the original holder passes on. The policy holders get money upfront that they otherwise won’t receive when they pass away. The attraction, then, is fairly simple. If you need money now, why not cash in on money you yourself will never get to touch.



Deal within Your Own State



While it’s a controversial subject, there is plenty you can do to limit or eliminate any potential problems. First, only deal with a settlement entity which is licensed in your state. Not only will this make it easier on both parties, but you may get to take advantage of some tax benefits.



Get Professional Help



Secondly, seek the help of a professional financial advisor who has experience in life insurance settlements. When you sell your life insurance policy, be sure to include all the taxes and in other fees involved so you don’t cut in to the profit you were calculating.



Get Multiple Quotes



Third, get multiple offers. With so many people entering this industry, you should be able to find more than one party interested in doing business. Use this to your advantage and find a favorable price. Make sure you get an offer in writing and give other interested buyer’s the opportunity to bid higher.



Selling your life insurance policy can solve one or more financial problems you may be facing during these tough economic times. Once it’s sold, it’s sold, so be sure to think the process through and get the advice of a reputable financial planner. Once you’ve made your decision to sell, be sure to apply the above tips to get the most out of your policy’s sale and begin enjoying your money today.



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