Life Insurance - Is A Whole Life Insurance Policy A Good Value?
\"The safest way to double your money is to fold it over once and put it in your pocket.\" -- Frank McKinney Hubbard
Whole life insurance is a type of life insurance policy that is marketed as an investment or \"forced savings\" plan. The claimed benefit of a whole life policy is that it builds cash value, which is the investment or savings part of the policy. When compared to other ways you could invest your money, a whole life insurance policy is simply not a good investment.
Some people falsely believe that their beneficiary will receive both the cash value and the death benefit if they die. However, when you die, your beneficiary will receive whichever is greater, either the policy death benefit or the accrued cash value. As an example, let\'s assume you purchased a $50,000 whole life policy and at the time of your death the cash value had grown to $30,000. Your beneficiary would receive only $50,000 upon your death, not $80,000. In that example, at least $30,000 of the death benefit paid came out of your pocket, more if you factor in the portion of the premiums that did not accrue as cash value. Sound like a good deal? It is for the insurance company because it only had to pay $20,000 or less to your beneficiary.
\"But you can borrow the cash value,\" the life insurance salesman will tell you. Most people never do that, and when they do, they have the privilege of paying interest on their own money. Further, whatever has been borrowed and not repaid when the insured dies is deducted from the death benefit that\'s paid out. Using our example above, if you had borrowed the $30,000 in cash value from your whole life policy, and had not repaid it before your death, your beneficiary would only receive $20,000.
What about the interest rate you can earn? You can get a better interest rate elsewhere. And as for the life insurance sales pitch that you can borrow the cash value tax-free, you can borrow any money from any source tax-free. Before you throw thousands of dollars away on whole life insurance premiums, consider the many other ways you could better save or invest that are not connected to a life insurance policy.
Steven Teichner is a former life insurance agent turned consumer advocate. His life insurance blog provides consumers with useful information, tips and tricks for getting the lowest rates and best values for their life insurance policies. You can get an expert life insurance quote from his trusted agent network, or read his latest blog posts at: http://lifeinsurancenow.com
While Buying The Right Insurance Quotes
Why do we need life insurance? It is rather an obvious question. Life insurance gives a financial security to your family. Ta...
Term Life Insurance Rates
A term life insurance covers a person for a substantial period of life, such as ten, twenty or thirty years. A person has to ...
Life Insurance
Life insurance is the policy you take out to protect your family and loved ones when you are gone.How would you feel if the p...
Term Life Insurance - What To Do When It’s The Best For You?
Term Life Insurance has some disadvantages and advantages. However, there are times in your life when it's not just your best...
Is Yonkers Term Life Insurance Right for You?
Life insurance, we all should have it, unfortunately, not all of us do. Many Americans are provided with life insurance thro...
Cheap Term Life Insurance - This May Be Your Best Option
Are you in need of life insurance protection but don't know what your best option is and don't have a lot of money to spend? ...
This Is By Far Your Best Cheap Life Insurance Option
If you are in need of a cheap life insurance policy then I'll tell you something right up front and I'm going to be brutally ...
Why Buy Life Insurance?
When thinking of buying life insurance, you need to bear in mind that cheaper is not always better. For you to get quality li...
What Is Group Term Life Insurance? What Is The Benefit Of Group Term Life Insurance?
Group term life insurance is the term used when term life insurance is taken in a group. Mostly employers usually take the gr...
Is a Life Insurance Comparison Really Necessary?
When you want to purchase a life insurance policy, you really do need to do a proper life insurance comparison. This is to en...
Life Insurance Policies
Life insurance is a kind of insurance policy that covers the costs after the death of the insured person. These costs include...
Know Term Life Insurance and Permanent Life Insurance
There are two basic types of life insurance: term and permanent. Term insurance is purely life insurance while permanent (aka...
Life Insurance Rates - These Policies Offer The Best Life Insurance Rates
Life insurance rates are different for each type of policy. There are basically two different types of life insurance that mo...
Term Life Insurance and Permanent Life Insurance
Term insurance and permanent insurance are two basic types of life insurance. Term life insurance is temporary, and it covers...
A Free Term Life Insurance Quote Is Very Easy To Obtain
By searching online for life insurance, you can get a free term life insurance quote with no obligation to buy. In order to g...
Whole and Term Life Insurance Online Quote - Things You Should Know Before You Commit
When investigating life insurance you will surely come across the terms whole life and term life. Knowing what these life ins...
Universal Life Insurance
Life is so uncertain and so many things can happen -- even the things you least expect, such as a sudden death. You could be...
Where to Compare Life Insurance to Get the Best Rate
Whether or not you are the main bread-winner for your family, your death can leave them in financial trouble. Its easy to com...
Finding Your Best Life Insurance Company
Purchasing life insurance is a big decision, and we all want the best coverage for the least cost. However, money is not the...
Life Insurance
The life insurance helps you to be sure of your future. The life insurance has the responsibility to help people decide about...