Episode 390 – It has been well documented that the biggest fear people have in retirement is running out of money. Incredibly, according to a 2024 survey done by Allianz Life, 63 percent of Americans are more fearful about running out of money than they are about dying. But is it possible to overdo it?

Hello, this is Bill Rainaldi, with another edition of Security Mutual’s SML Planning Minute. In today’s episode: is it possible to spend too little in retirement?

It has been well documented that the biggest fear people have in retirement is running out of money. Incredibly, according to a 2024 survey by Allianz Life, 63 percent of Americans were more fearful about running out of money than they were about dying.[1]

That may be taking things to an extreme, but there’s a valid point. It’s perfectly reasonable to worry about running dry when you’re used to a certain lifestyle and you no longer have a steady paycheck. And mortality tables these days are more favorable than many people realize. For example, the odds are better than 50-50, if you’re a married couple both age 62, that at least one of you is going to live past age 90.[2] So, you may have to figure out a spending plan—without the employment income you’ve become used to—for potentially 30 years or more.

Retirement is a huge turning point in most people’s lives. You’re switching from a savings and accumulation mindset to one where you’re living (at least partially) off of those savings. You might have gotten used to seeing your net worth go up considerably over the last few years. But for most of us, those days are over once you make the crossover.

It’s a major psychological barrier, so of course you’re going to be concerned about overspending. But how much is too much, or more appropriately, how little is too little? Do you think you might look back during your last years, and feel like you could have done more with your family, and you don’t really need all that money you have now?

The risks of overspending, particularly in the early years of retirement, should be obvious. But what exactly are the risks of underspending? According to an article by Greg Iacurci for CNBC, one big risk is “Not living as fulfilling a life as one could have.”[3] This could mean foregoing a big family trip, that could give your children and grandchildren memories to last a lifetime, because you’re afraid you’re going to run out of money years down the road.

Then there’s the issue of inheritance. Many parents hope to leave a certain amount of money to their children and grandchildren when they’re gone. That could be a factor in your calculation. Cutting back on your spending now would likely benefit them later on. But is it worth it?

But perhaps there’s another way. How about purchasing some additional life insurance? The right amount of life insurance might make you more comfortable with the idea of living the life you’ve already earned. It’s a straightforward idea: the more life insurance you have, the less you need to worry about your kids’ inheritance.

There is data to indicate that underspending is more common than people realize.[4] In a recent study by the Employee Benefit Research Institute, 33 percent of retirees still have 100 percent or more of their initial savings amount remaining by the time they get to their mid-80s.[5]

Recent medical developments have complicated the equation. Progress against diseases such as cancer, Alzheimer’s and heart disease could extend all of our lives further than we expected. That is, of course, great news. But it could cause some financial complications.

Another approach, advanced by some, is that we need to adjust our spending based on what “phase” of retirement we are in. The argument goes that there are three “phases” of retirement: the “go-go,” the “slow-go” and the “no-go” years.[6] You’re certainly less likely to be travelling the world during your declining years, so chances are you’ll be spending less. It could be a way to justify spending more during the early “go-go” years, although you also need to consider the possibility of increased health care costs during your later “no go” years.

So why wouldn’t you spend a little extra while you have the opportunity to enjoy it?

The truth is that every situation is different, and there’s no one correct answer. It is possible to spend too little during retirement, but the consequences of spending too much can be far more significant. Perhaps the best you can do is focus on time with your family. Quality time creates lasting memories. That could mean a few vacations to exotic places, but it doesn’t have to be that way. Sometimes a simple visit or gesture can go just as far.

The transition to retirement is filled with uncertainty. “Have I saved enough?”, “How long will my savings last?”, “Can I afford to live it up a little bit?” Such questions will likely arise, but you don’t need to go it alone. Your Security Mutual Life insurance agent can help. Your Security Mutual Life insurance agent can augment or help assemble your planning team. They’ll help coordinate with your attorney and tax professional to review your situation and to determine the insurance plan that will best suit your needs and objectives.

[1] Allianz Life Insurance Company of North America. “Nearly 2 in 3 Americans Worry More about Running Out of Money than Death.” Allianzlife.com. https://www.allianzlife.com/about/newsroom/2024-Press-Releases/Nearly-2-in-3-Americans-Worry-More-about-Running-Out-of-Money-than-Death (accessed June 9, 2026).

[2] Wohlner, Roger. “Living Past 90: How to Play the Long Game on Retirement, Tax Planning.” Thinkadvisor.com. https://www.thinkadvisor.com/2025/03/26/how-to-plan-for-clients-who-might-live-to-90-and-beyond/ (accessed June10, 2026).

[3] Iacurci, Greg. “Retirement ‘underspending’ is risky, advisor says. Here’s why.” Cnbc.com. https://www.cnbc.com/2026/06/08/retirement-risk-underspending.html (accessed June 9, 2026).

[4] Id.

[5] “New EBRI Research Finds Guaranteed Income Streams May Help Retirees Preserve Assets Later in Retirement.” Employee Benefit Research Institute.. https://www.ebri.org/retirement/content/summary/new-ebri-research-finds-guaranteed-income-streams-may-help-retirees-preserve-assets-later-in-retirement (accessed June 9, 2026).

[6] Dougan, Scott M. “How to Plan for Retirement’s Go-Go, Slow-Go and No-Go Years.” Kiplinger. https://www.kiplinger.com/retirement/plan-for-retirement-go-go-slow-go-and-no-go-years (accessed June 9, 2026).

This podcast is brought to you by Security Mutual Life Insurance Company of New York, The Company That Cares®. The content provided is intended for educational and informational purposes only. Information is provided in good faith. However, the Company makes no representation or warranty of any kind regarding the accuracy, reliability, or completeness of the information.

The information presented is designed to provide general information regarding the subject matter covered. It is not to serve as legal, tax or other financial advice related to individual situations, because each individual’s legal, tax and financial situation is different. Specific advice needs to be tailored to your situation. Therefore, please consult with your own attorney, tax professional and/or other advisors regarding your specific situation.

To help reach your goals, you need a skilled professional by your side. Contact your local Security Mutual life insurance advisor today. As part of the planning process, he or she will coordinate with your other advisors as needed to help you achieve your financial goals and objectives. For more information, visit us at SMLNY.com/SMLPodcast. If you’ve enjoyed this podcast, tell your friends about it. And be sure to give us a five-star review. And check us out on LinkedIn, YouTube and Twitter. Thanks for listening, and we’ll talk to you next time.

Tax laws are complex and subject to change. The information presented is based on current interpretation of the laws. Neither Security Mutual nor its agents are permitted to provide tax or legal advice.

The applicability of any strategy discussed is dependent upon the particular facts and circumstances. Results may vary, and products and services discussed may not be appropriate for all situations. Each person’s needs, objectives and financial circumstances are different, and must be reviewed and analyzed independently. We encourage individuals to seek personalized advice from a qualified Security Mutual life insurance advisor regarding their personal needs, objectives, and financial circumstances. Insurance products are issued by Security Mutual Life Insurance Company of New York, Binghamton, New York. Product availability and features may vary by state.​

Episode 389 – Sometimes people get confused by all the jargon used in the financial services industry. It’s difficult to understand what you’re buying—or what you already have—if you don’t understand the language being used. Here is a quick listing of ten terms, commonly used in the life insurance industry, that you might not fully understand.

Hello, this is Bill Rainaldi, with another edition of Security Mutual’s SML Planning Minute. In today’s episode: we explain 10 commonly misunderstood life insurance terms.

Sometimes people get confused by all the jargon used in the financial services industry, and life insurance is no exception. It can be difficult to understand what you’re buying—or what you already have—if you don’t understand the language being used. Here is a quick listing of 10 terms, commonly used in the life insurance industry, that are helpful to have a basic understanding of:

And finally…

All these terms can be very confusing. Some may be applicable to you; some may not. The good news is that, if you’re contemplating a new life insurance policy, you don’t need to go it alone. Your Security Mutual Life insurance agent can help. Your Security Mutual Life insurance agent can augment or help assemble your planning team. They’ll coordinate with your attorney and tax professional to review your situation and to determine the insurance plan that will best suit your needs and objectives.

[1] Ethos Life. “Understanding the Life Insurance Grace Period.” Ethos.com. https://www.ethos.com/life-insurance/life-insurance-grace-period/ (accessed June 4, 2026).

[2] Kagan, Julia. “Understanding Accelerated Benefits in Life Insurance Policies.” Investopedia.com https://www.investopedia.com/terms/a/accelerated-benefits.asp (accessed June 4, 2026).

[3] Stimpson, Jeff. “Form 1099-LTC Explained: Long-Term Care and Death Benefits.” https://www.investopedia.com/1099-ltc-form-what-to-know-about-the-1099-ltc-form-4781748 (accessed June 4, 2026).

[4] Progressive Insurance. ”What is a life insurance critical or chronic illness rider?” Progressive.com. https://www.progressive.com/answers/critical-chronic-illness-rider/ (accessed June 4, 2026).

This podcast is brought to you by Security Mutual Life Insurance Company of New York, The Company That Cares®. The content provided is intended for educational and informational purposes only. Information is provided in good faith. However, the Company makes no representation or warranty of any kind regarding the accuracy, reliability, or completeness of the information.

The information presented is designed to provide general information regarding the subject matter covered. It is not to serve as legal, tax or other financial advice related to individual situations, because each individual’s legal, tax and financial situation is different. Specific advice needs to be tailored to your situation. Therefore, please consult with your own attorney, tax professional and/or other advisors regarding your specific situation.

To help reach your goals, you need a skilled professional by your side. Contact your local Security Mutual life insurance advisor today. As part of the planning process, he or she will coordinate with your other advisors as needed to help you achieve your financial goals and objectives. For more information, visit us at SMLNY.com/SMLPodcast. If you’ve enjoyed this podcast, tell your friends about it. And be sure to give us a five-star review. And check us out on LinkedIn, YouTube and Twitter. Thanks for listening, and we’ll talk to you next time.

Tax laws are complex and subject to change. The information presented is based on current interpretation of the laws. Neither Security Mutual nor its agents are permitted to provide tax or legal advice.

The applicability of any strategy discussed is dependent upon the particular facts and circumstances. Results may vary, and products and services discussed may not be appropriate for all situations. Each person’s needs, objectives and financial circumstances are different, and must be reviewed and analyzed independently. We encourage individuals to seek personalized advice from a qualified Security Mutual life insurance advisor regarding their personal needs, objectives, and financial circumstances. Insurance products are issued by Security Mutual Life Insurance Company of New York, Binghamton, New York. Product availability and features may vary by state.​

Episode 388 – Financial trends come and go, but the latest, “SKI,” or Spending Kids’ Inheritance, is likely to have a lasting impact. Are you prepared? There are some ways to learn how to “SKI” without getting hurt.

Hello, this is Bill Rainaldi, with another edition of Security Mutual’s SML Planning Minute. In today’s episode, dealing with the latest financial trend: spending your kids’ inheritance.

Have you heard of the latest movement in personal finance? It’s called “SKI,” or “Spending Kids’ Inheritance.” Not surprisingly, it can create conflict across generations.

It wasn’t that long ago that people commonly followed the same financial plan: save money during your high earning years, spend carefully during retirement, and leave a decent inheritance for your kids so that they can live a better life than you did. But according to a recent article in Kiplinger, those plans are changing. Rather than focusing on what they’ll eventually leave behind, more people are trying to spend their money while they’re still here to enjoy it.

Today, new retirees are spending more on experiences, including “bucket list” travel.[1] In many ways, it’s simply recognizing that your health, longevity and energy levels are going to run out someday, and maybe it’s best to experience some fun while you still have the chance.

And it’s having an effect on the travel industry. The trend has become noticeable enough that it’s “beginning to reshape how affluent travelers are spending their money on luxury travel.”[2]

It’s understandable why this is happening. As we’ve documented in previous episodes, longevity is on the rise. But there’s also evidence to suggest that healthspans aren’t keeping up. Healthspan can be defined as the number of years a person lives a “healthy, active, disease-free life.”[3]

Research by the World Health Organization indicates that there’s a growing disparity between lifespan and healthspan. The average gap between lifespan and healthspan is estimated at approximately 12.5 years in the United States, which is 13 percent higher than it was in the year 2000. In other words, over time, people are gaining extra years of life faster than they are gaining years of good health.[4]

Perhaps one other reason for the upswing in SKI is that a surprising number of heirs end up wasting their inheritance. According to a recent survey by Texas Tech University and the University of Alabama, a substantial portion of heirs spend all of their inheritance in the first year. By then, a full 42 percent had seen their net worth drop back to or below what it had been before the inheritance.[5] As one of the authors wrote, “This propensity to immediately spend the entire inheritance is high. In fact, it’s higher than with ANY OTHER type of financial windfall (when controlling for windfall size).”

There are certainly some risks built into the SKI trend. For one thing, if you’re not careful, you could easily spend your own retirement savings too quickly and be forced to adjust to a lower standard of living. And so many people underestimate the eventual cost of health care and long-term care. Also, it’s easy to let small upgrades in your lifestyle add up to a much bigger problem later on, a phenomenon known as “lifestyle creep.”

Kiplinger goes on to suggest some ideas for how to SKI intelligently. First, you need to set a baseline. Not for what you want to spend, but for what you want to keep. This should help maintain some peace of mind for both you and your heirs.[6]

Next, they suggest doing some extra budgeting when it comes to travel. Make travel a specific factor in your overall retirement plan. The author also feels that a bucket list trip doesn’t have to be to an exotic place on the other side of the world. It just has to be meaningful. In the long run, a memorable shared experience while you’re living can have a greater impact than a bigger inheritance.[7]

And finally, maybe you can still make some gifts to your heirs from time to time. The belief is that a smaller financial gift, at the right time, can have an oversized impact. So can bringing some of your heirs along with you on some of your trips. The memory might end up being more important than the money.[8]

An important question remains, however: how to deal with SKI? There’s one potential solution they fail to mention: life insurance. It’s there to provide that extra cushion. If you’ve got enough of it, you can feel free to spend a good chunk of your kids’ inheritance without much guilt. It’s as if you’ve addressed the inheritance part prior to your retirement spending. Purchasing life insurance, and early, can be one of those instances where you really can get the best of both worlds during your working years and in retirement.

And as you probably realize, the older you get, the higher life insurance premiums become. So, the sooner you start, the better.

Do you have enough life insurance that your heirs will be OK if you decide to go “Skiing?” Your Security Mutual Life insurance agent can help. Your Security Mutual Life insurance agent will augment or assemble your team and coordinate with your attorney and tax professional to review your situation and to determine the insurance plan that will best suit your needs and objectives.

[1] Maddox, Choncé. “The SKI Travel Trend Is Reshaping Retirement Spending.” Kiplinger.com. https://www.kiplinger.com/personal-finance/travel/ski-retirement-travel-trend (accessed April 28, 2026).

[2] Kompanik, Noreen. “The SKI trend that’s reshaping travel.” GMtoday.com. https://www.gmtoday.com/travel/the-ski-trend-that-s-reshaping-travel/article_07ca7b72-0eb4-43fc-b8ec-e69fef82a694.html (accessed April 29, 2026).

[3] Buckles, Susan. “The global divide between longer life and good health.” Mayoclinic.org. https://newsnetwork.mayoclinic.org/discussion/the-global-divide-between-longer-life-and-good-health/ (accessed April 28, 2026).

[4] Borst, Heidi. “Longevity In The U.S.: The Gap Between Lifespan and Health Span.” Forbes.com. https://www.forbes.com/health/wellness/longevity-life-expectancy/ (accessed April 28, 2026).

[5] Brin, Dinah Wisenberg. “Heirs Beware: 42% Spend Inheritance Within a Year, Study Finds.” Thinkadvisor.com. https://www.thinkadvisor.com/2026/04/07/heirs-beware-42-spend-inheritance-within-a-year-study-finds/ (accessed April 28, 2026).

[6] Maddox, Choncé. “The SKI Travel Trend Is Reshaping Retirement Spending.” Kiplinger.com. https://www.kiplinger.com/personal-finance/travel/ski-retirement-travel-trend (accessed April 28, 2026).

[7] Id.

[8] Id.

This podcast is brought to you by Security Mutual Life Insurance Company of New York, The Company That Cares®. The content provided is intended for educational and informational purposes only. Information is provided in good faith. However, the Company makes no representation or warranty of any kind regarding the accuracy, reliability, or completeness of the information.

The information presented is designed to provide general information regarding the subject matter covered. It is not to serve as legal, tax or other financial advice related to individual situations, because each individual’s legal, tax and financial situation is different. Specific advice needs to be tailored to your situation. Therefore, please consult with your own attorney, tax professional and/or other advisors regarding your specific situation.

To help reach your goals, you need a skilled professional by your side. Contact your local Security Mutual life insurance advisor today. As part of the planning process, he or she will coordinate with your other advisors as needed to help you achieve your financial goals and objectives. For more information, visit us at SMLNY.com/SMLPodcast. If you’ve enjoyed this podcast, tell your friends about it. And be sure to give us a five-star review. And check us out on LinkedIn, YouTube and Twitter. Thanks for listening, and we’ll talk to you next time.

Tax laws are complex and subject to change. The information presented is based on current interpretation of the laws. Neither Security Mutual nor its agents are permitted to provide tax or legal advice.

The applicability of any strategy discussed is dependent upon the particular facts and circumstances. Results may vary, and products and services discussed may not be appropriate for all situations. Each person’s needs, objectives and financial circumstances are different, and must be reviewed and analyzed independently. We encourage individuals to seek personalized advice from a qualified Security Mutual life insurance advisor regarding their personal needs, objectives, and financial circumstances. Insurance products are issued by Security Mutual Life Insurance Company of New York, Binghamton, New York. Product availability and features may vary by state.​

Episode 387 – We hear so much talk these days about reverse mortgages. Are they worth looking into? For some people the answer is yes, but only if certain conditions are met.

Hello, this is Bill Rainaldi, with another edition of Security Mutual’s SML Planning Minute. In today’s episode: so what exactly is a reverse mortgage?

It’s hard to miss all the talk these days about reverse mortgages as an income tool for retirees. Some experts like them, some experts don’t. But what are they and how do they work?

For many Americans, their biggest asset is the equity they have in their home. Some might not have saved much for retirement. But after years, perhaps decades, of living in the same home, they’ve built up their home equity through appreciation and amortization of their mortgage. When they look at their balance sheets, that becomes their biggest plus.

What options do people have if they get to retirement age, have limited retirement savings, and realize that Social Security just isn’t going to be enough? A reverse mortgage is one possible answer.

A reverse mortgage is available for homeowners aged 62 and over. It is a way to fund retirement by borrowing against the equity you’ve built up in your home. The more home equity you have, the better. But it’s certainly not for everyone.

A reverse mortgage is not the same thing as a home equity line of credit, or HELOC. It’s called a reverse mortgage because instead of you making monthly payments to the bank, the bank makes monthly payments to you. The income you get from a reverse mortgage is generally not taxable. You can use that income as needed to cover monthly expenses, including such things as home maintenance, property taxes, or, if needed, home health care expenses.[1]

A reverse mortgage isn’t free. The amount you owe against your house, which includes the principal and accruing interest, increases as you receive your monthly payments. So over time, your home equity decreases. You are essentially trading a little bit of your home equity every month for current income.

Note that you typically don’t have to repay the mortgage as long as you continue to use the home as your primary residence. But if you decide to sell your house or move out, the full balance will become due. If you die before you move out, in most cases your executor will sell the home and use the proceeds to pay back the accumulated reverse mortgage debt.[2]

Reverse mortgages generally come in three different varieties. The first, and by far the most common, are loans overseen by the Federal Housing Authority. These are known as Home Equity Conversion Mortgages or HECMs. The homeowner has discretion over what to use the funds for, but before closing, they must meet with a counselor approved by the Department of Housing and Urban Development. This one requirement is designed to help curb fraud and abuse.

HECMs account for approximately 95 percent of all reverse mortgages.[3] They are more regulated than other types of reverse mortgages and offer some extra protection. For one thing, neither you nor your heirs will ever owe more than the house is worth, even if it goes down in value. And if your lender goes out of business, the federal insurance program guarantees that you will still receive your monthly payments.[4]

The maximum you can borrow under the federal program in 2026 is $1,249,125.[5] You will typically need to have at least 50 percent equity in your home (based on appraised value) to qualify. Reverse mortgages typically have adjustable interest rates. Note that the income from a reverse mortgage usually comes in the form of a monthly payment, but that’s not a requirement. It can also be in a lump sum.

The two other less common types of reverse mortgages are “single-purpose reverse mortgages,” which are backed by a nonprofit organization or a state or local government, and “proprietary reverse mortgages,” which are offered by private organizations without any government backing.

Reverse mortgages have had a somewhat mixed reputation over the years. For one thing, the fees involved can be considerable. A reverse mortgage typically has origination fees, mortgage insurance premiums, closing costs and monthly servicing fees, all of which add up.[6]

And there are still some scams out there. Some fraudsters will entice vulnerable seniors with misleading or fraudulent claims. One of those might be when a potential intermediary tries to get you into a reverse mortgage, then uses the money for some sort of “investment opportunity” that they control. They will then typically end up pocketing some of your home’s equity themselves.[7] One way to avoid scams like this is to start with a trusted financial advisor or your current lender.

Are there other potential solutions? Of course. The most obvious is, if possible, to save more at an earlier age and allow compound interest to work its magic. But for a lot of people, that’s just not possible. For some people, a reverse mortgage is another option. There are caveats, but this may be a good choice in the right circumstances. A reverse mortgage is not the perfect solution, but for some, depending on their situation, it may be the most viable one.

[1] Equifax Life Stages. “What is a Reverse Mortgage and How Does it Work?” Equifax.com. https://www.equifax.com/personal/education/credit/score/articles/-/learn/reverse-mortgage/ (accessed May 19, 2026).

[2] Id.

[3] Yale, Aly J. “What Is a Reverse Mortgage?” AARP.org. https://www.aarp.org/money/personal-finance/reverse-mortgage-guide/ (accessed May 19, 2026).

[4] Id.

[5] Johnson, Jamie. “HECM Loan Limits: What They Are and How They Work in 2026.” Themortgagereports.com. https://themortgagereports.com/124868/hecm-loan-limits (accessed May 20, 2026).

[6] Miller, Peter G. “Reverse mortgage pros and cons.” Bankrate.com. https://www.bankrate.com/mortgages/reverse-mortgage-pros-and-cons/#cons (accessed May 20, 2026).

[7] Goff, Kacie. “Reverse mortgage scams: What they are and how to avoid them.” Bankrate.com. https://www.bankrate.com/mortgages/reverse-mortgage-scams/#common-scams (accessed May 20, 2026).

This podcast is brought to you by Security Mutual Life Insurance Company of New York, The Company That Cares®. The content provided is intended for educational and informational purposes only. Information is provided in good faith. However, the Company makes no representation or warranty of any kind regarding the accuracy, reliability, or completeness of the information.

The information presented is designed to provide general information regarding the subject matter covered. It is not to serve as legal, tax or other financial advice related to individual situations, because each individual’s legal, tax and financial situation is different. Specific advice needs to be tailored to your situation. Therefore, please consult with your own attorney, tax professional and/or other advisors regarding your specific situation.

To help reach your goals, you need a skilled professional by your side. Contact your local Security Mutual life insurance advisor today. As part of the planning process, he or she will coordinate with your other advisors as needed to help you achieve your financial goals and objectives. For more information, visit us at SMLNY.com/SMLPodcast. If you’ve enjoyed this podcast, tell your friends about it. And be sure to give us a five-star review. And check us out on LinkedIn, YouTube and Twitter. Thanks for listening, and we’ll talk to you next time.

Tax laws are complex and subject to change. The information presented is based on current interpretation of the laws. Neither Security Mutual nor its agents are permitted to provide tax or legal advice.

The applicability of any strategy discussed is dependent upon the particular facts and circumstances. Results may vary, and products and services discussed may not be appropriate for all situations. Each person’s needs, objectives and financial circumstances are different, and must be reviewed and analyzed independently. We encourage individuals to seek personalized advice from a qualified Security Mutual life insurance advisor regarding their personal needs, objectives, and financial circumstances. Insurance products are issued by Security Mutual Life Insurance Company of New York, Binghamton, New York. Product availability and features may vary by state.​

Episode 386 – Why would you ever choose NOT to accept an inheritance? There are a few good reasons. And it’s doable if you decide that’s what you want.

Hello, this is Bill Rainaldi, with another edition of Security Mutual’s SML Planning Minute. In today’s episode: should I turn down my inheritance?

So, a family member has died recently and left some assets to you. You should be happy you’ve been left an inheritance, but it’s complicated. Maybe you’d rather the money went to someone else. Or maybe, for whatever reason, it’s just not worth the trouble. Do you have to accept it? The answer is no.

Why would you ever choose not to accept assets that someone has given to you? There are a few situations where it makes sense. One case might be related to federal or state estate taxes. If you’re already a high-net-worth individual who may have an estate tax issue, it may be better to disclaim, assuming your preferred beneficiary is next in line. This is especially true if the next beneficiaries are your children, who are likely to inherit your assets eventually. Why subject the assets to an extra layer of taxation on the way there?

Also, inheriting certain assets, such as a traditional IRA, can be very complicated. When you inherit an IRA, unless you’re a surviving spouse, current tax law requires you to withdraw the funds—and pay income taxes along the way—within ten years. If you’re in a high-income tax bracket, you might not end up with as much as you hoped for. The next person in line, who might be in a lower income tax bracket, could end up with more money after taxes. And they may need the income more than you do.

One sophisticated strategy some people use is to set up their favorite charity as a secondary beneficiary to their estate. If the IRA owner trusts his or her heirs’ judgment, he or she could leave the IRA to them. They would then figure out whether it makes sense to disclaim the IRA, allowing it to pass to the charity. This could result in considerable income tax savings.[1]

Sometimes there are other reasons you might choose to disclaim. The asset could be a rundown piece of real estate with deferred maintenance or environmental issues. In a case like that, you might decide that you just don’t want it.

Or maybe you simply don’t need it. That could be a key consideration if the next person in line is your child or someone else you care about. Just keep in mind that it gets tricky if the new inheritor is a minor. Minors are considered legally incapable of owning assets directly, so they generally can’t assume control or management of inherited assets. A court-appointed legal guardianship may be required.[2]

So, what happens if you decide the answer is “no, thanks?” You would then need to file what’s called a “qualified disclaimer.” If you do it properly, the assets pledged to you will be passed along to the next person in line. Although every state and every situation is different, here are some generic rules you might need to follow:[3]

Note that it is also possible to execute a partial qualified disclaimer, but it can be tricky. For example, if you’re scheduled to receive a certain number of shares in a publicly traded company, you may be able to keep a selected percentage of those shares while disclaiming the rest.[5]

It’s important to understand that a qualified disclaimer has its limitations. Maybe the most important of those is that you have to completely give up any right to the disclaimed assets. In other words, if you say no, you don’t get to choose what happens next. You’ll need to look closely to see where the money will end up if you disclaim. You might prefer that your children be next in line, but it’s not your choice. If it’s actually your long-lost cousin Ethel, that could also be a factor in your decision.

It’s not often that people are in a position to decline inherited assets. But in certain situations, it’s nice to know that it can be done, if it makes sense.

[1] Saunders, Laura. “When Heirs Are Right to Say ‘Thanks but No Thanks’ to an Inheritance.” The Wall Street Journal. https://www.wsj.com/personal-finance/taxes/when-heirs-are-right-to-say-thanks-but-no-thanks-to-an-inheritance-5ea96aac?mod=Searchresults&pos=1&page=1 (accessed May 11, 2026).

[2] Trust & Will. “Minors Inheriting Assets: Limitations and Considerations.” Trust&will.com. https://trustandwill.com/learn/minors-inheriting-assets (accessed May 11, 2026).

[3] Hartnett, Stephen C., J.D., LL.M. “Qualified Disclaimers.” Aaepa.com. https://www.aaepa.com/2014/03/disclaimers/ (accessed May 11, 2026).

[4] TaxNotes. “Sec. 25.2518-2 Requirements for a qualified disclaimer.” TaxNotes.com. https://www.taxnotes.com/research/federal/cfr26/25.2518-2 (accessed May 11, 2026).

[5] National Archives Code of Federal Regulations. “§ 25.2518-3 Disclaimer of less than an entire interest.” Ecfr.gov. https://www.ecfr.gov/current/title-26/chapter-I/subchapter-B/part-25/subject-group-ECFRac39af22636eabc/section-25.2518-3 (accessed May 11, 2026).

This podcast is brought to you by Security Mutual Life Insurance Company of New York, The Company That Cares®. The content provided is intended for educational and informational purposes only. Information is provided in good faith. However, the Company makes no representation or warranty of any kind regarding the accuracy, reliability, or completeness of the information.

The information presented is designed to provide general information regarding the subject matter covered. It is not to serve as legal, tax or other financial advice related to individual situations, because each individual’s legal, tax and financial situation is different. Specific advice needs to be tailored to your situation. Therefore, please consult with your own attorney, tax professional and/or other advisors regarding your specific situation.

To help reach your goals, you need a skilled professional by your side. Contact your local Security Mutual life insurance advisor today. As part of the planning process, he or she will coordinate with your other advisors as needed to help you achieve your financial goals and objectives. For more information, visit us at SMLNY.com/SMLPodcast. If you’ve enjoyed this podcast, tell your friends about it. And be sure to give us a five-star review. And check us out on LinkedIn, YouTube and Twitter. Thanks for listening, and we’ll talk to you next time.

Tax laws are complex and subject to change. The information presented is based on current interpretation of the laws. Neither Security Mutual nor its agents are permitted to provide tax or legal advice.

The applicability of any strategy discussed is dependent upon the particular facts and circumstances. Results may vary, and products and services discussed may not be appropriate for all situations. Each person’s needs, objectives and financial circumstances are different, and must be reviewed and analyzed independently. We encourage individuals to seek personalized advice from a qualified Security Mutual life insurance advisor regarding their personal needs, objectives, and financial circumstances. Insurance products are issued by Security Mutual Life Insurance Company of New York, Binghamton, New York. Product availability and features may vary by state.​

Episode 385 – If your income goes up over time, it doesn’t necessarily mean that you’ll be able to save more. If you’re not careful, “lifestyle creep” can make things worse. Here are a few ideas on how to fight back against lifestyle creep.

Hello this is Bill Rainaldi, with another edition of Security Mutual’s SML Planning Minute. In today’s episode, we take a look back at one of our favorite previous episodes, careless spending can erode income gains.

It may be counterintuitive, but sometimes doing better financially can do more harm than good to your savings. This is due to a phenomenon known as lifestyle creep. Lifestyle creep, sometimes referred to as “lifestyle inflation,” occurs when your spending increases as your income rises, turning yesterday’s luxuries into today’s necessities. Without realizing it, this slow increase in expenses can make it difficult to save money and reach your financial goals.

Increases in online shopping, subscription services and food delivery can all be indicators of lifestyle creep.[1] The result is that, in spite of your improved income, you begin saving and investing less and less. What can you do if you see this happening to you?

Here are a few ways to resist the impulse spending that comes with lifestyle creep:

If your income goes up over time, it doesn’t necessarily mean that you’ll have more money in your savings or checking accounts. Very often it does, but if you’re not careful, lifestyle creep can kill any progress towards your financial goals or even make things worse. The best way to deal with this is up to you, but careful planning and simply thinking through your spending is a good start.

This doesn’t mean that you’re never going to splurge. There’s no need to get too worried about small, infrequent, indulgences.[7] Focus on the bigger picture.

[1] Tam, Ruth and Aslam, Michelle. “If your spending is eating your savings, you might be experiencing ‘lifestyle creep’.“ NPR.org. https://www.npr.org/2022/07/13/1111300716/lifestyle-creep-definition (accessed March 10, 2025).

[2]  Id.

[3] Id.

[4]  Id.

[5] Id.

[6] Gould, Wendy. “The Seductive Trap of the Lifestyle Creep.” Verywellmind.com. https://www.verywellmind.com/lifestyle-creep-8667848 (accessed March 14, 2025).

[7] Tam, Ruth and Aslam, Michelle. “If your spending is eating your savings, you might be experiencing ‘lifestyle creep’.“ NPR.org. https://www.npr.org/2022/07/13/1111300716/lifestyle-creep-definition (accessed March 10, 2025).

This podcast is brought to you by Security Mutual Life Insurance Company of New York, The Company That Cares®. The content provided is intended for educational and informational purposes only. Information is provided in good faith. However, the Company makes no representation or warranty of any kind regarding the accuracy, reliability, or completeness of the information.

The information presented is designed to provide general information regarding the subject matter covered. It is not to serve as legal, tax or other financial advice related to individual situations, because each individual’s legal, tax and financial situation is different. Specific advice needs to be tailored to your situation. Therefore, please consult with your own attorney, tax professional and/or other advisors regarding your specific situation.

To help reach your goals, you need a skilled professional by your side. Contact your local Security Mutual life insurance advisor today. As part of the planning process, he or she will coordinate with your other advisors as needed to help you achieve your financial goals and objectives. For more information, visit us at SMLNY.com/SMLPodcast. If you’ve enjoyed this podcast, tell your friends about it. And be sure to give us a five-star review. And check us out on LinkedIn, YouTube and Twitter. Thanks for listening, and we’ll talk to you next time.

Tax laws are complex and subject to change. The information presented is based on current interpretation of the laws. Neither Security Mutual nor its agents are permitted to provide tax or legal advice.

The applicability of any strategy discussed is dependent upon the particular facts and circumstances. Results may vary, and products and services discussed may not be appropriate for all situations. Each person’s needs, objectives and financial circumstances are different, and must be reviewed and analyzed independently. We encourage individuals to seek personalized advice from a qualified Security Mutual life insurance advisor regarding their personal needs, objectives, and financial circumstances. Insurance products are issued by Security Mutual Life Insurance Company of New York, Binghamton, New York. Product availability and features may vary by state.​

Episode 384 – Being named as an estate executor is often considered an honor, and you will be compensated for your efforts. But is it worth all the potential trouble?

Hello, this is Bill Rainaldi, with another edition of Security Mutual’s SML Planning Minute. In today’s episode: are you sure you want to be an executor?

Perhaps you should consider it an honor. Your Uncle Charlie, who always liked, trusted and respected you, has named you as the executor of his will. What does that even mean?

The executor of an estate is the person (or, sometimes an entity) appointed to manage the financial affairs of a deceased individual and to carry out their wishes as outlined in their will. The executor is usually a family member, but it can also be a close friend, financial advisor or family lawyer. It can also be a financial institution. And sometimes there’s more than one.

So, what does an executor do? Here are some of the early steps many executors take: obtaining copies of the death certificate and filing a copy of the will with the probate court where the deceased lived. Before the court approves the executor, they may schedule a hearing to give interested parties a chance to either contest the will or object to the appointment of the executor.[1]

Once approved, the executor generally needs to notify the appropriate parties of the decedent’s death. This may include friends and family members, financial institutions and government agencies, such as the Social Security Administration. Then they usually need to gather all the estate’s assets and liabilities.

After that, the executor will need to settle any debts or taxes before the assets can be distributed. Once all this is done, they will supervise the distribution of the assets.[2]

It sounds complicated, and it very often can be. It typically takes three to six months, but it can be much longer, sometimes as long as two years or more.[3] [4] And it could involve a major time commitment on the executor’s part. Also, the amount of paperwork can be overwhelming.

Here’s one good reason to say yes: executors usually get paid. However, for small and modest sized estates where family members act as executor, this is often done free of charge.  In larger and more complicated estates, the rate is typically set by state law, with a normal rate of anywhere between 2 and 5 percent of the total estate value.[5] In many cases the rate will be calculated on a sliding scale based on the value of the estate. In New York, for example, the fee is 5 percent for estates below $100,000, gradually dropping down to 2 percent for estates of more than $5 million. Two percent of $5 million is $100,000.

Things can sometimes get tricky for an executor. In most states, the executor can also be a beneficiary of the estate.[6] This has the potential to create a conflict of interest, if not conflict with the other beneficiaries.

The entire process can be overwhelming for some. It’s important to remember that even though it may be an honor, you don’t have to accept it. Another alternative might be to accept the assignment but hire some professionals to help you out.[7]

And people do sometimes turn down the opportunity to serve as an executor, despite any personal or financial incentives. Potential family conflicts are sometimes enough to scare someone off. For example, the decedent might own a house that is scheduled to be split among his children. But what happens if one of them is already living there? The executor may have to notify the resident that he or she must move out so that the property can be sold.

It may carry some prestige, but acting as the executor can often put them in the middle of disagreements between some of the heirs over the distribution of assets. If you’re a family member or friend, being an executor can cause irreparable damage to your personal relationships, and that’s one of the big reasons people sometimes opt out.

It’s also important to recognize that an executor is considered a fiduciary for the estate and its beneficiaries. This is a high ethical standard where, if the executor does something wrong or enriches him or herself unjustly, they can be sued personally. The potential for personal liability may be enough of a reason to reject the nomination, particularly in large or complicated estates.

Finally, note that things can get even more complicated if the individual does not have a will. In that case, the court will appoint someone to be the administrator of the estate. That’s basically the same job as the executor, but with a court-appointed individual who may or may not have known the decedent.

If you’re the one who’s doing your own estate planning, putting together the will—with the help of a qualified estate planning attorney—is a good start. You’ll need to think seriously about who you want as your executor. Just as important, you need to communicate early and openly about your decisions with everyone involved. And be sure to revisit your choice every few years.

[1] MetLife. “Executor of Estate: What Do They Do?” MetLife.com. https://www.metlife.com/stories/legal/executor-of-estate/ (accessed April 16, 2026).

[2] Id.

[3] American Wills & Estates. “How Long Does Probate Take and How Much Does it Cost?” Americanwillsandestates.com https://americanwillsandestates.com/blog/how-long-does-probate-take-and-how-much-does-it-cost/ (accessed April 16, 2026).

[4] Beck, Lenox & Stolzer. “How Long Does It Take to Distribute Assets and Close an Estate?” Beckelderlaw.com. https://beckelderlaw.com/how-long-does-it-take-to-distribute-assets-and-close-an-estate/# (accessed April 16, 2026).

[5] The Olear Team. “Executor of estate fees: How much is paid, and when?” Olear.com. https://olear.com/executor-estate-fees-much-paid/#:~:text=What%20are%20executor%20of%20estate,executor%20fee%20is%202%20percent (accessed April 16, 2026).

[6] MetLife. “Executor of Estate: What Do They Do?” MetLife.com. https://www.metlife.com/stories/legal/executor-of-estate/ (accessed April 16, 2026).

[7] Miura, Danielle. “Your client is the executor. Now what?” Insurancenewsnet.com. https://insurancenewsnet.com/innarticle/your-client-is-the-executor-now-what (accessed April 16, 2026).

This podcast is brought to you by Security Mutual Life Insurance Company of New York, The Company That Cares®. The content provided is intended for educational and informational purposes only. Information is provided in good faith. However, the Company makes no representation or warranty of any kind regarding the accuracy, reliability, or completeness of the information.

The information presented is designed to provide general information regarding the subject matter covered. It is not to serve as legal, tax or other financial advice related to individual situations, because each individual’s legal, tax and financial situation is different. Specific advice needs to be tailored to your situation. Therefore, please consult with your own attorney, tax professional and/or other advisors regarding your specific situation.

To help reach your goals, you need a skilled professional by your side. Contact your local Security Mutual life insurance advisor today. As part of the planning process, he or she will coordinate with your other advisors as needed to help you achieve your financial goals and objectives. For more information, visit us at SMLNY.com/SMLPodcast. If you’ve enjoyed this podcast, tell your friends about it. And be sure to give us a five-star review. And check us out on LinkedIn, YouTube and Twitter. Thanks for listening, and we’ll talk to you next time.

Tax laws are complex and subject to change. The information presented is based on current interpretation of the laws. Neither Security Mutual nor its agents are permitted to provide tax or legal advice.

The applicability of any strategy discussed is dependent upon the particular facts and circumstances. Results may vary, and products and services discussed may not be appropriate for all situations. Each person’s needs, objectives and financial circumstances are different, and must be reviewed and analyzed independently. We encourage individuals to seek personalized advice from a qualified Security Mutual life insurance advisor regarding their personal needs, objectives, and financial circumstances. Insurance products are issued by Security Mutual Life Insurance Company of New York, Binghamton, New York. Product availability and features may vary by state.​

Episode 383 – The concept of a wealth tax—applying a tax to the value of someone’s assets—has become popular in some state legislatures in the last few years. Are they likely to catch on anytime soon?

Hello, this is Bill Rainaldi, with another edition of Security Mutual’s SML Planning Minute. In today’s episode: the latest on wealth taxes.

Public budget concerns seem to be everywhere, and state governments are no exception. The problem has gotten worse in the past few years because, in some cases, states would like to continue programs that were started with federal COVID spending that has since run out.[1]

So, what’s left for a state to do? Some are taking a look at so-called “wealth taxes” as a way to raise revenue. The appeal of wealth taxes is that, in theory, a state government can raise significant sums of money while affecting only a small slice of its population.

A wealth tax takes a completely different approach from a sales, income or estate tax. It’s a tax imposed on someone’s net worth, that is, the total market value of their assets minus liabilities.[2] Here’s an example. Let’s say there’s a two percent wealth tax on individuals with a net worth above $100 million in a particular state. If you’re lucky enough to have a net worth of $1 billion, you would pay on the difference of $900 million, resulting in a tax bill of $18 million. Some proposed wealth taxes are written to occur annually while others are written as a one-time levy.

One of the arguments in favor of wealth taxes is that they could raise a significant amount of revenue for the individual states. Another is that they would make the tax system more progressive and thus lessen the effects of income inequality. Some studies have indicated that income inequality has risen in the United States in recent years.[3]

But there are also some notable arguments against the use of wealth taxes, particularly at the state level. For one thing, individual mobility would likely work against them. In other words, a high-income individual facing a wealth tax can simply move to another state to avoid it.

There is evidence to suggest that a high tax burden can prompt some people to relocate. For example, after decades of growth, California, the state with the highest maximum income tax rate at 13.3 percent, has led the nation in net out-migration for six consecutive years, according to a 2026 report.[4]

Critics suggest that more recent developments in California could make matters worse. The state is now considering a referendum that, if approved, would impose a one-time five percent wealth tax on state residents with a net worth of $1 billion or more. Advocates are currently gathering signatures in an effort to get the proposed tax on the ballot in 2026.[5]

There is anecdotal evidence that some California billionaires have left the state out of fear that the proposal will become law, among them Larry Page, Sergey Brin and Mark Zuckerberg.[6]

Other states, such as Illinois, Maryland and Washington have all introduced wealth tax legislation, although the final outcome remains uncertain in each state.[7]

There are still unanswered questions about how a wealth tax would work. Conceptually, a wealth tax is based on the value of your assets, rather than the income you receive from them. This is different from, for example, capital gains taxes, which only become payable when you sell the asset. What happens if you pay a wealth tax one year—without selling the assets—and then the value of those assets goes down the next year? Would you get a refund? The answer seems to be no.

At the federal level, the question of whether a wealth tax is permitted under the U.S. Constitution is a matter of intense legal debate. The federal income tax began in 1913 after the 17th Amendment was passed to specifically authorize it.[8] Many experts believe that a federal wealth tax would not currently pass a constitutional challenge, and it would likely take another amendment before it is allowed.[9]

At the state level, each one of them has its own constitution, and they’re all different. There are potential legislative, constitutional and practical obstacles that could end up being too big to handle. Only time will tell whether the states will be able to collect the bonanza they’re hoping for.

[1] Finseca. “Finseca Policy 02/24/26: State Wealth Tax Blitz & US Deficit Updates.” Finseca.org. https://www.finseca.org/finseca-policy-02-24-26-state-wealth-tax-blitz-us-deficit-updates/ (accessed April 13, 2026).

[2] Peter G. Peterson Foundation. “What Is a Wealth Tax, and Should the United States Have One?” Pgpf.org. https://www.pgpf.org/article/what-is-a-wealth-tax-and-should-the-united-states-have-one/ (accessed April 13, 2026).

[3] Cunningham, Mary. “Wealth inequality in America just hit its widest gap in more than 3 decades.” CBSNews.com. https://www.cbsnews.com/news/us-wealth-gap-widest-in-three-decades-federal-reserve/ (accessed April 13, 2026).

[4] Christopher, Nilesh. “California’s exodus isn’t just billionaires — it’s regular people renting U-Hauls, too.” The Los Angeles Times. https://www.latimes.com/business/story/2026-01-08/californias-exodus-isnt-just-billionaires-its-regular-people-renting-u-hauls-too (accessed April 13, 2026).

[5] BDO USA, P.C. “California’s Billionaire Tax Proposal Would Allow Sweeping, One-Time Taxation Based on Net Worth.” BDO.com. https://www.bdo.com/insights/tax/californias-billionaire-tax-proposal-would-allow-sweeping-one-time-taxation-based-on-net-worth (accessed April 13, 2026).

[6] Perman, Stacy. “Inside the exodus of California tech billionaires to Florida.” The Los Angeles Times. https://www.latimes.com/entertainment-arts/business/story/2026-03-11/inside-exodus-of-california-tech-billionaires-to-florida (accessed April 13, 2026).

[7] Finseca. “Finseca Policy 02/24/26: State Wealth Tax Blitz & US Deficit Updates.” Finseca.org. https://www.finseca.org/finseca-policy-02-24-26-state-wealth-tax-blitz-us-deficit-updates/ (accessed April 13, 2026).

[8] Bishop-Henchman, Joe. “Is a Wealth Tax Constitutional?” Ntu.org. https://www.ntu.org/foundation/detail/is-a-wealth-tax-constitutional (accessed April 13, 2026).

[9] Id.

This podcast is brought to you by Security Mutual Life Insurance Company of New York, The Company That Cares®. The content provided is intended for educational and informational purposes only. Information is provided in good faith. However, the Company makes no representation or warranty of any kind regarding the accuracy, reliability, or completeness of the information.

The information presented is designed to provide general information regarding the subject matter covered. It is not to serve as legal, tax or other financial advice related to individual situations, because each individual’s legal, tax and financial situation is different. Specific advice needs to be tailored to your situation. Therefore, please consult with your own attorney, tax professional and/or other advisors regarding your specific situation.

To help reach your goals, you need a skilled professional by your side. Contact your local Security Mutual life insurance advisor today. As part of the planning process, he or she will coordinate with your other advisors as needed to help you achieve your financial goals and objectives. For more information, visit us at SMLNY.com/SMLPodcast. If you’ve enjoyed this podcast, tell your friends about it. And be sure to give us a five-star review. And check us out on LinkedIn, YouTube and Twitter. Thanks for listening, and we’ll talk to you next time.

Tax laws are complex and subject to change. The information presented is based on current interpretation of the laws. Neither Security Mutual nor its agents are permitted to provide tax or legal advice.

The applicability of any strategy discussed is dependent upon the particular facts and circumstances. Results may vary, and products and services discussed may not be appropriate for all situations. Each person’s needs, objectives and financial circumstances are different, and must be reviewed and analyzed independently. We encourage individuals to seek personalized advice from a qualified Security Mutual life insurance advisor regarding their personal needs, objectives, and financial circumstances. Insurance products are issued by Security Mutual Life Insurance Company of New York, Binghamton, New York. Product availability and features may vary by state.​

Episode 382 – Divorced spouses may be caught unaware that they could be eligible for a Social Security benefit based on their ex’s work history. The rules are complicated, but if you’re in that situation, there may be a pleasant surprise waiting for you: collecting a Social Security benefit you didn’t even know existed.

Hello, this is Bill Rainaldi, with another edition of Security Mutual’s SML Planning Minute. In today’s episode: Social Security and divorce.

We spoke extensively about the phenomenon of “gray divorce” in an episode last summer, meaning divorce specifically for those over age 50. While the overall divorce rate has fallen in recent years, the rate among people over age 50 has risen dramatically.[1] And for those people, it’s important to know something about how Social Security works for divorced spouses.

It’s safe to say that getting divorced can be, and usually is, a trying experience. And it can really mess up your retirement, especially for the lower-earning spouse. But the Social Security Administration (SSA) has provided some flexibility for divorced spouses when it comes to collecting their retirement benefits.

When considering Social Security, selecting the right claiming strategy often comes down to understanding two special types of benefits: spousal and survivor benefits. And with both of these, there are special rules designed to protect divorced spouses. Understanding these rules can make a huge difference in the quality of your life in retirement.

First, let’s talk about spousal benefits. Spousal benefits are generally available any time one spouse has a personal Social Security benefit that’s less than half of the other spouse’s benefit. For example, assume your benefit at age 67 (Full Retirement Age or FRA) is $3,000. But your spouse may have only worked part-time, or may have left the workforce for a period of time. So, let’s say their personal benefit as a result is only $500.

Spousal benefits max out at 50 percent of the higher-earning spouse’s FRA benefit. So, if you both file at 67, you would receive your full personal benefit of $3,000. Your spouse would receive his or her own personal benefit of $500, plus an additional spousal benefit of $1,000, bringing their total benefit to $1,500, which is 50 percent of yours. You can also choose to collect earlier if you wish—at a reduced rate—so long as you’re at least 62 years old, which is the youngest age for filing for a personal or spousal benefit.

But if your spouse has a personal benefit that is more than half of yours, no spousal benefit would apply. Also, note that your spouse does not become eligible for a spousal benefit until you yourself file. So, if you choose to max out your benefit by waiting until age 70, your spouse has to wait too, at least for the spousal portion.

What are the special regulations that affect divorced spousal benefits? First, it’s important to recognize the most basic rule: if you were married for at least 10 consecutive years before you got divorced, you are entitled to the same benefit you would have received if you were still married. So, you may be able to receive that spousal benefit even if you’re no longer married.

But there’s more. Aside from being married ten years, if you have also been divorced for at least two, you are considered “independently entitled” to benefits.[2] As we said, for a married couple, the lower-earning spouse cannot get a spousal benefit until the other spouse collects their own benefit. But this rule is waived for an independently entitled ex-spouse. This helps avoid the awkward situation of trying to coordinate things with your ex.

Finally, it’s important to recognize that if you decide to re-marry at some point, the spousal benefit disappears. At that point, it’s as if the first marriage never happened. But perhaps you can still qualify for a spousal benefit with your new spouse. The ten-year rule only applies to divorced spouses. A current spouse can receive a spousal benefit once they’ve been married for at least one year.

Now let’s cover survivor benefits, which are probably even more important for most married and divorced spouses.

Note that survivor benefits are not 50 percent, they’re 100 percent of the higher-earning spouse’s benefit. And in most cases, they’re pretty straightforward. Once you get past FRA, the surviving spouse’s benefit is simply the higher of the two.

So, let’s continue with our previous example. You’re collecting $3,000 a month, and your spouse is collecting $1,500, which includes a $1,000 spousal benefit. If you die, your spouse moves up to your benefit of $3,000 per month. If your spouse dies before you do, you simply go on collecting your $3,000.

If you’re still married, that’s at least one piece of good news: your spouse gets a raise. But there’s also some bad news (aside from the fact that you’re not there anymore!). As a household, you were collecting a total of $4,500 while both of you were still alive. Now that’s down to $3,000 for the surviving spouse alone.

What happens if the higher-earning spouse dies before reaching FRA? Basically, the surviving spouse can receive reduced survivor benefits beginning at age 60 (or 50 if disabled) or 100% of the deceased spouse’s calculated benefit if they wait until their own FRA. The survivor receives the higher of their own retirement benefit or the deceased spouse’s, with payments potentially reduced if taken early. There’s not one single answer and it’s recommended to consult with a Social Security expert if you fall into this particular situation.

In a divorce situation, what happens when the higher earning spouse dies? When it comes to survivor benefits for a divorced spouse, the 2- and 10-year rules apply. Other than that, the rules are a little bit less restrictive than with spousal benefits. For one thing, you have the option of re-marrying without giving up your right to a survivor benefit on your ex, so long as that second marriage occurs after you reach age 60.

So many divorcing spouses fail to think about Social Security when they’re going through the divorce. And even fewer truly understand how spousal and survivor benefits work for a divorced spouse. The important thing to remember is that you may be entitled to benefits from Social Security that you hadn’t even thought of. But you may also need help figuring it all out.

The rules for Social Security are far more complicated than we can explain here. That’s why the assistance of a qualified professional is always recommended. Your Security Mutual Life insurance agent can help assemble your team and coordinate with your attorney and tax professional to review your unique situation and to determine the insurance plan that best suits your needs and objectives.

[1] Sergeant, Jacqueline. “Gray Divorce Surge Leaves Women In Need Of Advisors, Experts Say.” Financial Advisor. https://www.fa-mag.com/news/women-want-financial-education-as-they-end-marriage-82256.html?section=43&utm_source=FA+Magazine&utm_campaign=FAN_FA+News_042525&utm_medium=email (accessed May 15, 2025).

[2] Hager, Thomas. “Ex-Spousal Benefits: What ‘Independently Entitled’ Means.” Forbes.com. https://www.forbes.com/sites/tomhager/2024/11/20/ex-spousal-benefits-what-independently-entitled-means/ (accessed March 26, 2026).

This podcast is brought to you by Security Mutual Life Insurance Company of New York, The Company That Cares®. The content provided is intended for educational and informational purposes only. Information is provided in good faith. However, the Company makes no representation or warranty of any kind regarding the accuracy, reliability, or completeness of the information.

The information presented is designed to provide general information regarding the subject matter covered. It is not to serve as legal, tax or other financial advice related to individual situations, because each individual’s legal, tax and financial situation is different. Specific advice needs to be tailored to your situation. Therefore, please consult with your own attorney, tax professional and/or other advisors regarding your specific situation.

To help reach your goals, you need a skilled professional by your side. Contact your local Security Mutual life insurance advisor today. As part of the planning process, he or she will coordinate with your other advisors as needed to help you achieve your financial goals and objectives. For more information, visit us at SMLNY.com/SMLPodcast. If you’ve enjoyed this podcast, tell your friends about it. And be sure to give us a five-star review. And check us out on LinkedIn, YouTube and Twitter. Thanks for listening, and we’ll talk to you next time.

Tax laws are complex and subject to change. The information presented is based on current interpretation of the laws. Neither Security Mutual nor its agents are permitted to provide tax or legal advice.

The applicability of any strategy discussed is dependent upon the particular facts and circumstances. Results may vary, and products and services discussed may not be appropriate for all situations. Each person’s needs, objectives and financial circumstances are different, and must be reviewed and analyzed independently. We encourage individuals to seek personalized advice from a qualified Security Mutual life insurance advisor regarding their personal needs, objectives, and financial circumstances. Insurance products are issued by Security Mutual Life Insurance Company of New York, Binghamton, New York. Product availability and features may vary by state.​

According to a survey by LIMRA, a life insurance trade organization, and Life Happens, an industry nonprofit, younger Americans tend to overestimate the cost of life insurance to a startling extent. Surveyors asked people aged 18 to 30 how much they thought a 20-year term life insurance policy would cost. The estimates were off-base. They averaged between 10 and 12 times the actual cost.[1]

This is a common misconception. A surprising number of people, particularly younger Americans, believe that life insurance is more expensive than it actually is. The perceived cost was cited as a reason why many Gen Z and Millennial adults, who generally recognize the need for life insurance, do not have it.[2]

Why do people get the numbers so wrong? According to author Dan Kraft at Life Insurance News, the answer might be found by studying behavioral economics and the concept of “anchoring.” “When consumers think of life insurance, they anchor the idea to big, long-term expenses—mortgages, car payments or medical bills. The assumption becomes: If it’s long-term, it must be expensive.”[3]

According to NerdWallet, if you’re a 30-year-old in good health, the average cost for a $500,000 20-year term life insurance policy is $215 per year for males, and $194 per year for females.[4] In other words, less than $20 per month. Keep in mind that these are average rates for non-smokers. If you smoke, the rates are likely going to be considerably higher.

Compare that to the cost of a cup of coffee, which averages $3 to $4 at Starbucks, depending on the location, size and type.[5] So if you’re getting coffee more than 6 or 7 times a month, a life insurance policy could be cheaper.

Streaming services are another example of something that can be more expensive than life insurance. The average cost is $70 per month, per household.[6] What this means is that even though many don’t realize it, a small adjustment in your discretionary spending could help provide you with peace of mind and a more secure future for you and your family.

But of course, we’re talking here about a term life insurance policy, and term policies expire. How much does a permanent life insurance policy cost? When it comes to whole life insurance, the average annual cost is $3,662 for men age 30, and $3,292 for women.[7] That’s considerably more, but not as much as some might expect.

And in the long run, buying life insurance younger may, in fact, be less expensive. By the time your first term life insurance policy expires, the next one is going to cost more, simply because you’re older. And that assumes you can even qualify medically for a new policy. Any adverse health development over that initial 20-year period could make it much more expensive—or even impossible—to buy a new policy.

Also, whole life insurance policies can accrue a cash value, which a term life insurance policy doesn’t. In certain circumstances, you may be able to access the cash value in the policy if you need to, by taking withdrawals or policy loans. The net cost, or difference between premiums paid and cash value, could be considered as the true out of pocket cost of the policy. In some cases that is less than a term policy, and for permanent coverage.

But remember that with all types of life insurance—whether term or permanent—the rates go up as you get older. Your second term life insurance policy is very likely to cost a lot more than the first one, even if your health stays the same. But whole life insurance gives you the chance to lock in those lower rates for life. It may cost more now, but with most policies the premium stays the same for life. If you choose a whole life insurance policy, someday you may be glad you did.

These are broad guidelines and policy contracts can have different characteristics, even if they’re the same basic type of policy. So be sure to compare your options carefully.

Your Security Mutual Life insurance agent can help. Your Security Mutual Life insurance agent can augment or assemble your team and coordinate with your attorney and tax professional to review your situation and to determine the insurance plan that will best suit your needs and objectives.

Regardless of which type of policy you choose, perhaps the most important decision you can make is to simply get started. As with so many other things, the longer you wait, the more it could end up costing you.

[1]LIMRA. “Adults Age 30 and Younger Overestimate Life Insurance Cost by 10–12 Times.” LIMRA.com.  https://www.limra.com/en/newsroom/news-releases/2025/adults-age-30-and-younger-overestimate-life-insurance-cost-by-1012-times/ (accessed March 18, 2026).

[2] Id.

[3] Kraft, Dan. “Is life insurance cheaper than coffee?” Insurancenewsnet.com. https://insurancenewsnet.com/innarticle/is-life-insurance-cheaper-than-coffee (accessed March 20, 2026).

 [4] Iervasi, Katia. “Average Life Insurance Rates for March 2026.” Nerdwallet.com. https://www.nerdwallet.com/insurance/life/learn/average-life-insurance-rates (accessed March 19, 2026).

[5] HackTheMenu. “Starbucks Menu Prices (2026).” Hackthemenu.com. https://hackthemenu.com/starbucks/menu-prices/ (accessed March 20, 2026).

[6] Lee, Wendy. “Consumers are spending $22 more a month on average for streaming services. Why do prices keep rising?” The Los Angeles Times. https://www.latimes.com/entertainment-arts/business/story/2025-11-21/why-do-streaming-prices-keep-rising-disney-netflix-paramount-what-to-know (accessed March 20, 2026).

[7] Iervasi, Katia. “Average Life Insurance Rates for March 2026.” Nerdwallet.com. https://www.nerdwallet.com/insurance/life/learn/average-life-insurance-rates (accessed March 19, 2026).

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