When you want to keep things simple, easy term life insurance is often the best route to take. Choosing life insurance depends on several factors, most notably your needs. Often, people opt for cheap life insurance without considering these factors and relying only on premium cost to judge the policies. However, the best life insurance for you might be a whole life policy, a universal life policy, or a term life policy. It is different for everyone.
Term life insurance is often considered simple or easy; term life insurance provides coverage for a specific term. So if, for example, you only need coverage until your mortgage is paid off or the children finish college, this could be the right option for your family. Whole life, which accrues a cash value, is better for long-term needs such as planning for the financial welfare of your spouse after you die, or planning for paying estate taxes. Certain term policies only run until you reach age 65 and therefore would not be the most affordable term insurance in the long run.
When you consider cost, easy term life insurance is often the most affordable option for people. It is especially so for younger people, because their premium costs are lower than those of older people. When cheap life insurance is your goal, term is usually the right option. Another idea is to start out with easy term life insurance and purchase it with a combination of whole life, and gradually change over to whole life. You could also purchase an affordable term insurance policy and use what you save on premiums to invest for the future. Investments such as 401(k) plans are tax-deferred until retirement. If you invest in taxable products, be sure to take taxes into consideration when planning.
Evaluating Long-term Needs
On the other hand, whole life insurance can be a good investment option for the long term. The cash value will potentially grow, tax-deferred, and you can borrow against it. If you later decide you no longer want life insurance, you could cash it in for its accumulated value. You could then purchase easy term life insurance instead, and use the cash for something else.
As you can see, whole life insurance and easy term life insurance both have their advantages. The best policy for you is the one that meets your needs in terms of budget, savings goals, and coverage needs. Contact Spectrum Direct today for advice and a free rate quote. If cheap insurance is your goal, purchase affordable term insurance. If you are more concerned with the policy's potential for growth in value and higher benefits, then choose whole insurance. We would be happy to discuss your options with you.
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