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If you have extra cash, time, and an open mind, whole life insurance is worth it. Over the long term, you can expect to earn returns similar to bonds and secure lifetime death benefit coverage that your beneficiaries will receive tax-free.
On the other hand, if you're young, just getting started in your career, and only have a couple of thousand bucks a year to make premium payments, you should buy term insurance for now while you still have excellent health.
The best life insurance companies will allow you to convert your term insurance policy to whole life later when you have a larger budget without a medical exam. Locking in the premiums for an affordable term life insurance policy is a good move. When you do that, you are also locking in a guarantee that you have some life insurance coverage that can later be converted to permanent coverage.
If you've been doing a lot of research about the different types of life insurance products (universal life insurance policy, term insurance, variable universal life) and whole life insurance policies, in particular, you're wrestling with a lot of conflicting information.
Whether or not whole life is worth it for you, will depend on your circumstances and where it may fit into your portfolio as part of your future financial plans. It depends on what you want to accomplish.
But if you choose to purchase a whole life policy or any type of permanent life insurance, remember that there is a “right way” to set up your policy if your primary goal is to buy a policy that builds cash value.
We help our clients maximize the policy's cash value accumulation with whole life insurance and occasionally an indexed universal life policy as well. We help hundreds of people do this every year and coach life insurance agents, financial advisors, and other financial professionals to do the same.
But at least a few times a week we're faced with questions like, “does it really work?”, “is it worth it?”, or our all-time favorite “can you send m
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