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Whole Life / Cash Value Life Insurance

Investing In Your Family's Financial Protection

There are basically two types of life insurance – term life and whole life.

Which one is right for you depends on your unique situation and individual goals. You can get a lot of information on the internet and even free quotes, but what you really need to do is talk to somebody about your specific situation. A good life insurance advisor will sit down and ask you questions about your specific situation before he or she makes any recommendations. That way you can know for yourself what’s better: whole life or term life insurance?

Below is some basic information to get you started or click the button to get expert guidance.

What is Whole Life / Cash Value Life Insurance?

Are you renting or owning your life insurance?

Life insurance is designed to provide financial security to your beneficiaries (the people you specify who will inherit your money) when you pass away. Whole life is a little more complicated and has two key differences from term life insurance.

What is Whole Life / Cash Value Life Insurance?

Are you renting or owning your life insurance?

Investing a little now pays off big down the road.

Life insurance is designed to provide financial security to your beneficiaries (the people you specify who will inherit your money) when you pass away. Whole life is a little more complicated and has two key differences from term life insurance.

Whole Life Insurance is Permanent

First, whole life does not go only for a certain period of time but is permanent. It is designed to last the rest of your life, no matter how long you live. As long as you’re current on your premium payments, your whole life policy will pay out in the event of your death. These policies are sometimes referred to as “traditional” or “permanent” life insurance.

A good analogy is renting. Most people understand the value of owning something over renting. For example, if you rent a home for 20 years, the home is 100% never yours. However, if you make payments for 20 years toward owning that home, you can pay it off and own it outright.

Whole Life Insurance has Value Now

The second key difference is that whole life policies also build a cash value. That is because part of your premium goes into a savings component. This money then accumulates with interest. The cash value portion of your life insurance policy is your money to withdraw or borrow from should you ever need it for any reason. People commonly use their life insurance cash value for college, investing, down payment on a home or even for retirement income. This is the reason many people prefer whole life / cash value insurance- they want more than “just in case” coverage. They like that they not only have a death benefit which pays out in full from day one, but also a liquid asset they can build and grow over the years.

Some cash value policies grow with the rates of a market index and can turn into a very healthy tax-free, lifetime payout. It is like building your own pension plan. The earlier you secure coverage, the smaller the premium needed to make a huge difference in retirement years.

Whole Life Insurance Is Not For Everyone

Man visiting with his doctor about life insurance.

Whole Life plans tend to be more expensive than Term Life plans (can sometimes be 3-4 times more expensive). This is because they offer guaranteed coverage for your entire lifetime with a locked rate and premium.

While many carriers do not require you to have perfect health, both term and whole life policies have underwriting requirements that must be met in order to qualify for coverage. A good agent can help you navigate the underwriting process and make recommendations that will help you meet these requirements. If you have health conditions or are overweight, you may be surprised at what options we are still able to find.

Man visiting with his doctor about life insurance.
Coverage that protects your children and grandchildren..

Are Your Children and Grandchildren Covered?

Have you considered getting coverage on your children or grandchildren? Whole life insurance sets them up early in life with an asset they keep their whole lives. Having coverage at an early age protects their insurability and locks in rates for pennies on the dollar. Many policies allow the kids to grow their death benefit at different stages of their lives without having to go through underwriting or qualification.