Whole vs. Term Life Insurance
If you’re in the market for a new life insurance policy, you’re probably well aware that there are two basic types available to you, whole and term life insurance. You could spend hours debating which one is better, but we can probably all agree that each has their advantages and disadvantages. In the end, it really comes down to which one fits your current circumstances better. Here’s an unbiased look at the two types:
Term Life Insurance
A term life insurance policy lasts for a specified limit of time or its “term.” During that term, you’re covered under your insurer’s policy as long as you continue to make payments. When the term is up, you typically have the option to renew for another term, however it is often more expensive since you’ve now gotten older. For many people, term life insurance makes a lot of sense - it gives them the flexibility to get a new plan later in life and is almost always less expensive than whole life insurance.
Whole Life Insurance
As you might have expected, a whole life insurance policy gives you insurance coverage for your whole life and does not expire as long as you continue to pay for it. Unlike term life insurance, some whole life policies build up cash over time and earn interest. Most of the people who take out a whole life insurance policy have the financial ability to pay for it and don’t expect to ever need a new policy.
Which is Best for Me?
So which type of life insurance is best suited for you? Well, it ultimately comes down to your decision, but there are some important things to consider, such as will you be financially stable for a long period of time? If you are then whole life might be best for you, but if you’re likely to experience financial changes or need less insurance than you might consider a term policy. Do you only want a short term policy to protect your children until they’re out on their own? A term life insurance policy would probably make sense in that situation. Remember too that most term life policies have the option of being converted into a whole life policy at a certain time. Either way, you can’t go wrong as both forms of life insurance offer great protection for your and your family’s future.