If you’re searching for life insurance, you have to make one crucial decisions, term life insurance or whole life insurance.
To do this, you have to look at a couple different factors.
You need to first decide where you are at in life, and what your long-term goals with the insurance are.
If it is something you want to keep for a long period of time, whole life insurance will probably be the way you want to go.
With whole life insurance, it goes for the remainder of your life, whereas term insurance only goes for a set amount of time, and you have to renew it after that period ends if you wish to continue having life insurance.
We are going to look at the advantages of a whole life insurance policy and help you decide if one of these plans will work for you.
Whole Life Vs. Term Life
Although whole life insurance has higher premiums than term insurance, the premiums do not go up over time like the premiums in term insurance do. Plus, part of the money you are paying goes to a cash account, and if you were to cancel the whole term insurance for some reason, you would receive the cash value of it. Otherwise, your family members would receive the cash value upon your death.
Also, most of these policies automatically stop at age 100, so if you do live to 100, the insurance policy closes and you receive the cash value of it. It is a good idea to keep an eye on the cash value of your whole life insurance to see how quickly it is going up and how much is there.
With a whole life insurance plan, you can also borrow money against the cash value of the policy. If you do not have the money and interest paid back before you die, whatever you still owe will be taken out of the cash value before it is given to your family members. With a participating whole life insurance policy, you could get paid dividends if the return on the investment is good enough.
These are used many times to reduce the premium. Non-participating policies have premiums that do not change throughout the life of the entire policy, so choosing the participating policy is something that is worth looking into when researching different whole life insurance policies.
Buying Whole Life Insurance
Before buying into whole life insurance, make sure you really assess where you are at in life and what you really need in an insurance policy. Because of the larger premiums, it could take ten years before you see a return on this policy, and although it is meant to be a lifetime policy, this may not meet your financial needs for the immediate or the future. This type of policy might be best for high earners who have saved as much as they can in other tax-deferred savings, since the cash on this type of policy isn’t taxed until it’s withdrawn.
Whole life can also work for older people who have things like small businesses who want to leave something to relatives because the cash value of the policy could wind up being more than they could save on their own.
Getting Affordable Life Insurance Coverage
If you want to secure better rates from the insurance company, you need to do some work before you apply. Whole life plans are not going to be the most affordable option, but you don’t have to have an expensive plan.
To start, let’s finally quit the smokes. You can’t smoke and get cheap coverage. Period. Smoking equals double the rates.
The medical exam is going to determine how much you pay for insurance coverage. If you want to get better rates, then you’ll need to improve your health. Better grades from the exam mean cheaper premiums.
To get better results is to stick to a healthy diet. Cutting out the junk food and switching it out for healthier options is a great way to improve your health.
Working With an Independent Insurance Agent
All of these ways are long-term changes you need to make. Improving your health and quitting smoking are things you can do overnight. If you want a quick way to save money, it’s simple. Give us a call.
What makes us stand out? Why are we different? We are independent brokers.
We aren’t restricted to sell you a plan from one company. We represent over 50 companies. Teaming up with our agents is both time efficient and cost efficient. It doesn’t cost you a dime to work with us. We are a free resource you can use to compare all of those carriers head-to-head.
We recommend finding life insurance as quickly as possible. There is no reason you should wait another day to get insurance.
If you’re ready, go ahead and call us. We can show you which company is the most affordable and offer you our expert advice.