What’s better: Term Insurance or Whole Life Insurance?
Posted by nc1978 on 03/27/09 in Health
Here’s an easy to understand explanation of the differences between whole life and term insurance.
I f you’re a new parent or just got married, you may not have given much thought to the kind of life insurance you’ll carry, but that’s a mistake. Anyone who’s married or has kids can’t afford to be so shortsighted. If you haven’t had a chance to make many investments or begin building your personal fortune, a life insurance policy may be the only legacy that you can leave to your family if something unfortunate befalls you. One of the first things that you need to understand is the difference between the different types of insurance. Two of the most common kinds are term life insurance and whole life insurance, so it’ vital to know the difference between the two kinds of insurance. To begin with, term life insurance is cheaper and has no cash value unless the insured person dies while covered by this insurance. It’s generally not expensive to obtain. Whole life insurance is more expensive, but the policy you buy has a cash value and can either pay a death benefit or be cashed in at the end of the specified time limit.
tag this
Derek | Apr 15, 2009 | Reply
Interesting! I never knew the difference between the two. So ostensibly, it would be reasonable for a person without a family to get a whole life insurance because it might be a valuable investment down the line, when they do have a family?
Cal | Apr 15, 2009 | Reply
When I first got married, I got life insurance because I knew my wife and child wouldn’t be ok if I died. But now my kids all have jobs, my wife has a nice nest-egg, and we’re debt free–should I still be paying life insurance premiums? I mean really, what’s the point?
Shawna | Apr 15, 2009 | Reply
So, if the difference is really so simple, why wouldn’t people get term life insurance? If its a cheap back up, that seems like an absolute no brainer. If you have extra money, it would be nice to have a cash value policy, but that’s not a luxury everyone can have.
Wynnie | Apr 15, 2009 | Reply
How bad are the premiums? I’ve heard horror stories about really expensive term life insurance and whole life insurance premiums that I’m kind of overwhelmed by. I don’t make much right now, but I’m still interested in protecting my daughter in the worst case scenario.
Mary | Apr 15, 2009 | Reply
As a parent, I think that life insurance is the responsible thing to do, and I made that choice for my family a long time ago. If anything happens to me, I want them to be able to deal and move on without their whole lives being ruined.
Carrie | Apr 15, 2009 | Reply
Why not build up other investments to pass on to your family if you die, like investing in high yield savings, bonds, and stocks? It’s a great time to start buying investments if you have the money; they’re dirt cheap. I think that’s a safer bet.
James | Apr 15, 2009 | Reply
Life insurance covers your bases. Yes, of course you want to reduce your debt, save for retirement, and put some money in smart investments like real estate and stocks, but in the event that something happens to you BEFORE you save everything you want to, you want to be covered.
Catherine | Apr 15, 2009 | Reply
As a 22 year old just out of college, I’m not really interested in buying any kind of life insurance right now, but I know that when I start a family, I definitely want myself and my husband covered so that a bad situation doesn’t become worse if something happens to us.