Buying life insurance is one of the most important financial decisions you can make for your family’s future. If you should die, life insurance pays money (called a “death benefit”) your loved ones could use to cover your funeral expenses, pay bills, and even possibly afford the things you want them to have. Whole life insurance is one of two major types of life insurance you could buy. (The other is called “term life.”) Like nearly every kind of life insurance, the purpose of whole life is to help protect your family when you aren’t around. So how is whole life different from other types of life insurance? Whole life insurance is permanent life insurance designed to last your whole life (...
Continue reading...
Premiums The premiums paid for a whole life insurance policy are usually higher than those paid for term insurance, especially during the early years of the policy. A whole life policy, however, particularly one acquired at a young age, is usually quite more cost effective. Unlike term life insurance policies, several whole life insurance polices provide for level premiums. Many people find it much easier to budget their insurance costs when their premiums remain level and fixed for the life of the policy. What does change over time is the amount of the premium that is applied to the insurance portion of the contract and the portion that is applied to the investment portion. As the insured...
Continue reading...
How does whole life insurance work? Whole life insurance provides coverage for your entire life. With most whole life plans, your premiums (monthly or annual fees) remain the same, regardless of changes to your health. And, your beneficiaries get a tax-free death benefit after you die. The death benefit refers to the amount of money your beneficiaries get when you die. You can name your family or anyone you want as your beneficiaries. Beneficiaries are the people or person you want to financially protect. The exact amount of money they get after you die depends on: how much life insurance coverage you buy and the type of policy you have. How does cash value work in a whole life...
Continue reading...
Whole life insurance is a great way to protect your family’s future while also accumulating cash value, which can help you throughout your life. Whole life insurance is a type of permanent life insurance, which means it doesn’t have an end date — it covers you for your entire life. In contrast, term life insurance expires after a certain number of years and does not accrue cash value. With whole life insurance, as you pay premiums, your policy builds equity, which is your accumulated cash value. This money can be used any time, and for any reason — be it to pay for a child’s wedding, to remodel your home, to start a business or to help supplement retirement income. How does whole life...
Continue reading...
Permanent Coverage Whole life insurance is just what its name suggests – it lasts for the “whole life” of the policyholder, unlike term life policies which expire after 10, 20 or 30 years (depending on the policy). While term life policies are often best for short-term financial planning – providing for the care of young children, paying off student loans, or paying off a mortgage – whole life insurance is designed for longer-range financial plans, such as estate planning, final expenses and charitable donations after the policyholder’s death. Level Premiums: The Whole Life Advantage Premiums on a whole life insurance policy stay the same for the duration of the policy – policyholders pay...
Continue reading...
What Is Whole Life Insurance? Most people are familiar with whole life insurance. For many years, whole life policies were the predominant type of life insurance sold in America. When you purchase a whole life policy, you traditionally pay a fixed premium for as long as you live or for as long as you keep the policy in force. In exchange for this fixed premium, the insurance company promises to pay a set benefit upon your death. In addition to providing a death benefit, a whole life policy can build cash value, which accumulates tax deferred. Part of the premium pays for the protection element of your policy, while the remainder is invested in the company’s general portfolio. The...
Continue reading...
Whole life insurance is just what it sounds like: a policy you buy into for the duration of your lifetime. And if the year 2020 was anything, it was a lesson in expecting the unexpected. (Seriously, who could have predicted that a masked trip to the grocery store would be the highlight of your social calendar?) While we all hope the years to come will be better, nothing says foresight like knowing your options when it comes to life insurance. Here’s what you need to know about whole life insurance. What is whole life insurance? Whole life insurance provides coverage for life at a fixed premium, meaning the cost of your individual payments never changes. This is a big advantage over term...
Continue reading...
A Look at Whole Life Insurance Whole life insurance is designed to remain in force for your whole life, as long as you remain current with your premiums. In exchange for fixed premiums, the insurance company promises to pay a set benefit when the policyholder dies. Whole life insurance policies can build up cash value — effectively a cash reserve that pays a modest rate of return. This growth is tax deferred. Guarantees are based on the claims-paying ability of the issuing company. Most whole life insurance policies allow policyholders borrow a portion of their policy’s cash value. Interest payments on policy loans go directly back into the policy’s cash value. When the...
Continue reading...
A Look at Whole Life Insurance Whole life insurance is designed to remain in force for your whole life, as long as you remain current with your premiums. In exchange for fixed premiums, the insurance company promises to pay a set benefit when the policyholder dies. Whole life insurance policies can build up cash value — effectively a cash reserve that pays a modest rate of return. This growth is tax deferred. Guarantees are based on the claims-paying ability of the issuing company. Most whole life insurance policies allow policyholders borrow a portion of their policy’s cash value. Interest payments on policy loans go directly back into the policy’s cash value. When the...
Continue reading...
A Look at Whole Life Insurance Whole life insurance is designed to remain in force for your whole life, as long as you remain current with your premiums. In exchange for fixed premiums, the insurance company promises to pay a set benefit when the policyholder dies. Whole life insurance policies can build up cash value — effectively a cash reserve that pays a modest rate of return. This growth is tax deferred. Guarantees are based on the claims-paying ability of the issuing company. Most whole life insurance policies allow policyholders borrow a portion of their policy’s cash value. Interest payments on policy loans go directly back into the policy’s cash value. When the...
Continue reading...
