October 14, 2014

What is the difference between whole life insurance and term insurance? If needed, what should you own and what should you avoid?

3 thoughts on “October 14, 2014”

  1. Garrett Haag says:

    The difference between the 2 is price for one main point. Whole life is sold as an investment and a very poor one at that. It can run $400 a month for half a million in coverage. While term life is much cheaper for the same coverage. Just over 13$ a month for the same half a million. You should never buy whole or any other life insurance product besides term. You only need life insurance when you have someone who depends on you financially. Always avoid annuities and cash value policies, if you want to invest buy a no load index fund. You can get good term policies from term4sale.com

  2. Mike Finley says:

    Well said, Garrett. Let’s review.

    Whole life is part insurance/part investment. Term life is just insurance. Whole life is much more expensive because of the investment part of it. As Garrett stated, whole life (sometimes called traditional) is very expensive because the insurance company pays the agents big fat commissions to “sell” you on the policy. Avoid whole life and all other cash value policies such as universal, variable, equity-index and whatever else they come up with. Buy term if needed.

    When buying term, consider annual renewable term (ART) or a level term policy that stays the same for 5, 10 or 20 years for example. Then you take the difference in money you would have spent and put it toward paying down debt, increasing savings and/or investing in your future with those very efficient no-load index mutual funds. Go to the insurance tab on this website to learn more. Arm yourself with a financial education!

  3. Rico Rumph says:

    Whole is for a life time, Term is for limited time periods 10 yr , 15 yr

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