According to some financial planning experts, buying whole life insurance isn’t worth the price. The reason? This type of life insurance has higher premiums and low returns on cash value.
On the other hand, term life insurance is typically less expensive. As such, with these savings, you can build wealth during your lifetime. Typically, this is accomplished by investing the savings in traditional means, such as a 401(k), IRA, or bonds.
What’s more, term life insurance policies may be better suited for those who;
- Need to replace income over a specified period of time.
- Are looking for a more affordable coverage option.
- Want a straightforward process.
However, individuals who require lifelong coverage and are also looking for safety and guarantees may find whole life insurance to be the better insurance product. Additionally, this type can be a useful estate planning tool for high-income individuals who have already exhausted their other tax-deferred accounts. It’s also possible to leave an inheritance to your heirs by adding whole life insurance to your will.
Also, for those over the age of 60, and want to shield their loved ones from financial burdens, whole life insurance is worth exploring. Specifically, a guaranteed issue for those who;
- Have been previously declined for life insurance.
- Believed that age or health has prevented you from obtaining life insurance.
- Do not want your family to worry about final expenses, such as the cost of your funeral.
