Whole life insurance is a type of policy that has no end date for coverage. It’s permanent and the payment of the death benefit won’t depend on the date of your passing. Whether you pass away at forty or seventy, your beneficiary will still have access to the death benefit.
Whole life insurance policies include an account where its cash value lies. This cash value will continue to increase throughout the duration of the policy. This money is tax-free, as long as the amount withdrawn isn’t attributed to investment gains. If you take out some money before then that was made through investments, that amount will be taxable.
If money is taken out, it’s possible for it to be put back. However, paying amounts back into a policy will require the addition of interest. This is typically not the best financial decision and can end up costing you more. It should be left for emergency situations and as a last resort.
Some of the premiums paid will go into the account, but not the entire portion. This is important to keep in mind, as it can determine the amount of money set aside and the sum to which it’ll grow. It’s typical for policies to have a guaranteed return rate. Being aware of this rate is incredibly important, as it’ll have a direct impact on the amount of money that’s in the account in the future.
If you have a family that relies on you financially, life insurance is the best way to insure they’ll be taken care of in the event of your passing. Even if your children are no longer dependents, take into account your spouse and any remaining costs you may leave behind.
If you’re looking to purchase life insurance, start researching the local insurance agencies in your area. Once you’ve found a few that you’re interested in, make an appointment to sit down and discuss your options. While you’re there, you can ask for a quote and get an idea of how much a whole life insurance policy could cost you.
Typical monthly premiums for whole life insurance vary greatly. They can range from $50-$250, but the actual price will depend on how long you’ll be paying and how much your policy is worth.
One of the best parts of whole life insurance premiums is that they won’t increase. When you purchase a policy and begin making premium payments, you’ll continue owing that same amount each month. A guarantee that your premiums won’t jump can provide reassurance that you’ll be able to afford your whole life insurance policy.
If you’re worried about the cost of a whole life insurance policy, we’re here to help. We can find you a policy that fits into your budget and works well for your situation.