In this video I will breakdown Term Life Insurance vs. Whole Life Insurance, to give you an idea of which is best for you.
Life insurance is one of those necessary things in life, because life happens! It's better to have life insurance and not need it, than need it and not have it.
The fact is, we all eventually need life insurance and this video will hopefully help you decide which is best for you.
Term life insurance provides coverage for a specific amount of time (usually 20-30 yrs). If you or your spouse passes away during this time, your beneficiaries will receive a payout from the policy.
Term life is much more affordable than whole life. Typically this works out to be $7 per month in 20 yr term, vs $100 with whole life cash value.
Term life has no cash value until the death occurs, so it’s not worth anything until you need it, which is fine.
Whole life is a form of permanent life insurance with 3 components:
1. Premiums
2. Death Benefits
3. Cash Value Accumulation (savings aspect)
When you pay your premium a portion is applied to the death benefit and cash value.
The first 5-10 years a majority is applied to the death benefits (cost of insurance) along with fees and commissions.
After this, the cash value will receive a great portion of the premium
Beneficiaries are only entitled to receive the death benefit portion of the policy when you die!!
You have no choice in how the life insurance company applies the premium you pay.
You can cash in or surrender your policy at any time to get your money out, but you lose the insurance!
