Why buy whole life insurance

When Is Whole Life Insurance a Good Investment Strategy? - NerdWallet

On the surface, life insurance sounds like an easy concept to grasp — you pay an insurance company a monthly or annual premium, and upon your death, the company pays out a sum to your beneficiaries. But permanent life insurance policies such as whole life insurance also contain an investment component, and that’s where things can get confusing. Some of the money paid into your whole life policy accumulates “cash value” in the form of a tax-sheltered investment account that the policyholder can borrow against. Insurance companies tout these policies as not only a way to leave a financial legacy to your heirs, but also as a good investment tool. Critics of this strategy point out that returns...

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