What is better term life insurance or whole life insurance?
LIKE OR DISLIKE:
The purpose of term life insurance is to protect your family for a specific time period. If you buy the right term life insurance, it does the job beautifully well.On the other hand, whole life insurance has two purposes. The first is to protect your family. (And if you face estate taxes, whole life insurance does protect you against that problem while term life doesn’t.) The second purpose of whole life insurance is to make insurance companies and agents lots of money.
Both the insurance policies have their own pros and cons. Term insurance will cover you to a certain time limit whereas whole life insurance will cover you till you live. You should consult with a financial planner and go for a best insurance plan.
Term is much cheaper, but, if you live long enough is no longer available. (Confusing but too complicated to explain all the "ins and outs")No wife? No kids? Buy term for about 3 times your annual income. Mother or sibling as beneficiary.Married? Kids? Situation is totally different. More life insurance needed.Talk, face to face, with 2 or 3 life insurance agents. Ask questions. Get understandable answers. Buy from the one that has the best program for you.
Just go sit down w a Financial Planner. Most FP's don't charge a fee to discuss w you. They are the only xperts, not the people here on YA. I work for FA's, so I know this. A lot of people are intimidated to talk to one because they frequently deal w very wealthy people, but frequently, their favorite clients are those w modest means. Go figure.
Better for what?A) You're a fireman, so you might not be able to buy life insurance outside of what's available at work.B) There are more than just two types of insurance.C) Even still one doesn't necessarily make the other one useless.Having a cash value policy (not necessarily a whole life policy) with a term insurance policy is a very good strategy. Also, a return of premium term policy is also a good hybrid strategy. Anyone that has a one product, one answer, one size fits all answer for a general question doesn't really get it. People have different reasons to do things, and if one was always better, then the other would cease to exist.
Whole life policies have a living benefit, and a tax-sheltered cash account that builds up inside. Clients don’t pay taxes on the gain each year, and that money can be used in retirement to supplement retirement planning. No such benefit is available with term insurance. Term insurance only has the actual life insurance coverage; there is nothing but a death benefit. In order for the benefit to be paid, somebody has to pass.
discuss this with your insurance agent, the conditions of each may apply to you one way or another betterif you have no one who will rely on your life insurance for their future, you might consider other forms of investment
Whole.Because term only lasts until you are 85, if not younger. So, if you die at 86, you will have nothing to bury yourself with, even though you went your entire life paying for it to do just that. That's why they call it "term." They cover you for a "term."Whole lasts as long as you live. So, even if you die at 120, it will still pay to bury you.
In truth, it depends on your specific situation.A lot of insurance salespersons will try to talk you into whole life policies as an "investment" although the truth is they result in fatter sales commissions. Life insurance is not an "investment" - it's protection for those who are financially dependent on you.Term life gives you the most "bang for your buck" but the critical factor is how long you expect to need that protection. Start by determining your insurance NEEDS before you even worry about type of policy. If you need advice, seek out a certified financial advisor - NOT an insurance salesman.
Whole. If you start dumping money into term you'll probably never see it again.
Term pays nothing unless you die….whole life does have options for getting money out later on if you so desire. Whole life policies often have a "pay back" clause where it pays you at a certain age.
What do you want life insurance for? If you don't have income that others are relying on for support, there is better ways to invest your money.
You may have life insurance connected through your job.Life insurance is not for you to use. It is to be able to provide for family, or possibly your burial.Although whole life builds value, it is generally about giving your own money back, and term life is cheaper and only needed to handle as stated.If you need insurance, generally the cheapest available rate in an amount necessary to take care of your own demise or for family you leave behind.
Whole life is more expensive but has cash value and you can keep it for life. Term is cheaper but it has a limited "term" so when your term is up, you have to get re-certified as being medically sound and by the time you hit your 50's, you may either no longer qualify due to health issues or your rates may skyrocket. But you really only need it to protect your loved ones and if you're a fireman, you'll probably leave a pension.
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