Should I Get Term or Whole Life Insurance

Life insurance is a subject that comes up for those starting new families to others who already have kids in college. Regardless of which category you fit in, the question that may have brought you here is, what will happen to my loved ones if I happen to die today or tomorrow? The first step to understanding which life insurance policy is best for you is to first understand the difference between Term and Whole life insurance.

Term Life Insurance

A term life policy is only active during a limited time frame which you have to select. Rates on a Term policy are generally very low compared to that of a whole life policy. These policies do not carry any “cash surrender value”. This policy pays only if the insured dies within the term period. The younger and healthier you are, the lower your life premium will be. As you get older or develop health conditions, these rates can increase. If you happen to live longer than the term you’ve selected then the policy will need to be renewed yet the premium will likely increase. Term life policies may last anywhere between 5 years and 20 years. The premium will also increase with the length of the term.

Whole Life Insurance

The nice thing about a whole life policy is it’s intended to protect you and your family for your entire life span. This type of policy will also build monetary (cash) value which may be withdrawn. The younger you are when put a policy in place, the better off you will be regarding your monthly premium. A payment will be guaranteed to the family upon the death of the insured.

Where a half million term policy may cost $30 a month, a half million whole life policy may cost around $150 a month. This is just a rough estimate of the cost difference between a term life insurance policy and a whole life policy. Many factors come into play. It is recommended that you speak with a local agent who can assist you with which policy is best fit for you. You can get in touch with a local Agent simply by requesting a life insurance quote for the type of policy you orignally had in mind. Once you receive a quoted premium then the Agent will have most of the information needed to go ahead and run quotes on any other life policies that you may have an interest in after discussing other options or ideas with the Agent.

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