Knowing what whole life VS term insurance is can be critical before you get to the senior years. It’s always a good idea to make money go as far as you possibly
can. But you have to be sure to plan ahead too.
The truth is though that life insurance is not for you… It’s for your loved ones.
And since a loved one indicates someone we love, then it’s
a decent idea to make sure they will be taken care of if we cease to exist.
That in its simplest form is what life insurance does.
Whole life insurance covers you for your whole life. Term
life insurance covers you only for a specific term or period of time. That
amount of time varies and is known when you buy the policy. A 20 year term is
going to cover you for 20 years.
The advantage of whole life insurance is that you don’t have
to worry about living past the term length. As long as you keep paying the
premiums, you will keep the insurance. Term insurance doesn’t do this, it terminates
at the end of the term regardless of whether you want to keep it or not. At the
end of the term if you are still alive and still have a need for life insurance
you would need to get another policy of some kind.
Here is where a problem can be presented; when you still
need some life insurance but you are still alive and well. Maybe you were in
your early twenties when you first bought a policy. You had purchased a policy
that was a 30 year term thinking that you would have the house paid off and be
out of debt. If that didn’t happen you may now be in your 50’s and still have a
mortgage and bills you don’t wish to leave as a burden on your loved ones. So
now you need another life insurance policy.
The problem is now; life insurance is not very affordable for
someone in their 50’s. Now you may wish that you had gotten a whole life
The best course of
action with Whole life VS term insurance?
The best thing to do when making a decision about whether
whole life vs term insurance is best for you is to look at your life insurance
needs every five to ten years. Determine how much has changed. Are your needs
different? Are you on course to meet your financial goals so that life
insurance will not be needed after the term policy expires?
If you can think ahead and plan then a whole life policy may
not be the best fit for you. The problem is that life has a way of surprising
us. Here is where a whole life policy really makes sense. When you aren’t sure
what would or could happen. And who knows anything for sure?
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