Which Life Insurance is the Right Fit?

Life insurance is vital if someone depends on you to support them.  If your income were to go away because you pass away, your loved ones need the financial security of continuing income.  A life insurance beneficiary doesn’t just have to be your spouse.  It can be a child, a business partner, or anybody else who relies on your financial support.

If you’ve ever looked into life insurance, you know that there are many different types and the choices can be overwhelming!  The two main types of insurance are term life insurance and whole life insurance.  Here are some characteristics of term life insurance and whole life insurance that can help you to make an informed decision.

Term Life Insurance

With term life insurance, you pick the number of years (or “term”) you want the policy to last.  If you pass away prior to the end of the term, your beneficiaries will receive the death benefit.  A death benefit is something you choose when you are opening a life insurance contract.  The higher the death benefit, the more expensive the premiums (or “payments”) will be.  Term life insurance is generally considered to be the cheapest form of life insurance. 

Whole Life Insurance

Whole life insurance lasts for – you guessed it – your whole life.  You do not have to keep re-upping after your term has run out.  Therefore, it is more expensive than term life insurance.  Another main difference is how the policy functions.  Like term life insurance, you have the death benefit.  However, you also have what’s called a cash value within the contract.  The cash value will grow at a rate determined by the insurance company and can be withdrawn (please be sure to consult your tax advisor so you are aware of any tax consequences when withdrawing cash value).

Getting life insurance is an important step to take in your financial journey.  It’s something that you may not usually think about when you’re looking over your finances, but it is one of the most important components of a complete financial plan.

I encourage you to complete the contact form at the bottom of the page if you need help deciding which type of life insurance coverage is the right fit for you or your family.

Content in this material is for general information only and not intended to provide specific advice or recommendations for any individual.