Unlike term life insurance which is only valid for a specific period, whole life insurance lasts for your entire life – assuming you continue to pay the policy premium. One of the most valuable aspects of whole life insurance is that it generates a cash value with significant tax benefits. Each time you pay your premium, a portion is set aside and invested in increasing the policy’s cash value and offers an alternative to saving and a supplement to your retirement accounts. While whole life insurance is significantly more expensive than term life insurance, it offers a multitude of benefits that are outlined below:
The Benefit is Permanent
It may be impossible to qualify for a term life insurance policy as you age because you must participate in an exhaustive physical health screening. However, with a whole life insurance policy, that benefit is 100% guaranteed if the policy remains in good standing.
Generate Cash Value
Each time you make a premium payment, part of that payment is used to cover the insurance and associated fees, while the rest is used to build a tax-deferred cash component that can grow significantly with time. A loan can be taken against that cash value and used for any purchase if needed.
The younger you are, the better time it is to purchase whole life because your premiums will likely be lower and will never increase, plus you’ll have more time to grow the cash value of your account.
Contact the Brokers Insurance Agency in Lincoln, NE for more information on life insurance. Our knowledgeable and professional team will be happy to answer all your questions and help you choose the right life insurance policy for your needs.