Protecting Your Retirement Against the Death of a Breadwinner

Retirement expert David Alemian continues his series on The 7 Retirement Killers with a look at how the death of a breadwinner can impact your retirement planning, and what to do to protect yourself.

The death of a breadwinner is one of “The 7 Retirement Killers.” Protection from this retirement killer is very simple—it’s called life insurance. The problem is most physicians do not have the proper amount and/or type of life insurance to suit their needs.

First of all, you need to cover all the breadwinners in your household. Each breadwinner needs the right amount and the right type of life insurance. The purpose of the life insurance is to protect the surviving spouse from the loss of the deceased spouse’s income.

I’m going to make this simple for you:

1) Forget about term insurance, because it is absolutely the wrong product for you. You want permanent life insurance, because you are going to need this for as long as you live.

2) You need the right amount of death benefit to provide for the surviving spouse for as long as he or she will live.

3) This is a long-term proposition, so you must account for inflation when figuring out how much the surviving spouse will need in the future. You can figure inflation will double the cost of living about every 21 years. Check out The Alemian File Episode 7 on inflation to learn more about inflation. If it’s costing you $15,000 to $20,000 per month to live today, a $2,000,000 dollar policy is not going to go very far in the future.

Depending on your age, you can get a policy that pays up to 25 times your income, plus liabilities like your mortgage and other debts. The Alemian File Episode 3: The Physicians Retirement Plan utilizes an investment-grade life insurance policy as the retirement savings vehicle. It could be a good way to get some or all of the coverage you need while saving for retirement at the same time. The best part is that for some of you it can be done with no out-of-pocket expense.

The best advice I can give you is to take action now, because at any given point in time you could develop a medical condition that makes you uninsurable. A good place to start is to get a review of the life insurance you currently have. If you have questions, send me an email at, and check out my website Make sure to come back here next week to Physicians Money Digest for another edition of The Alemian File.

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