| Term life insurance is generally the cheapest form | | | | If you're not restricted to purchasing only the |
| of life insurance, but it's not the only option. Unlike | | | | cheapest life insurance, whole life is an option |
| term coverage, in which only the face value is | | | | worth considering. Universal life insurance, which is |
| paid out upon your death, a whole life policy | | | | a variation of whole life insurance, gives you more |
| accrues a cash value. | | | | flexibility in your premium, the term and death |
| In order for the cash value to increase, money | | | | benefits, but this flexibility does come with |
| over and above that which is necessary to cover | | | | increased risks. |
| the premium must be collected. Because of this, | | | | However, since universal life insurance premiums |
| whole life insurance rarely will be the cheaper of | | | | are flexible, it sometimes is the cheaper of the |
| the two. | | | | two. |
| With a whole life insurance policy, a portion of the | | | | The potential disadvantages |
| premium you pay will be used to invest in mutual | | | | Whole life insurance does have its downsides. One |
| funds, stocks, bonds or other type of interest | | | | is that it's not possible to guarantee a rate of |
| bearing investment. | | | | return on your investment so it may not pay the |
| Even though whole life is not as cheap as term | | | | dividends you expect. Another fact worth noting |
| life insurance, such a policy can make sense if it's | | | | is that a whole life policy probably won't have a |
| managed properly. | | | | cash value until a minimum of 3 or even 5 years |
| Benefits of Whole Life Insurance | | | | so if you surrender the policy during this time, |
| One of its best benefits is that it will cover a | | | | expect it to be costly. |
| person for his or her whole life. Once the policy is | | | | The debate rages on as to whether it makes |
| purchased, it will never have to be renewed. It will | | | | sense for anybody, regardless of age, gender or |
| remain in effect until you die provided you do not | | | | marital status, to purchase anything other than |
| allow it to lapse or be compromised in some | | | | the cheapest term life insurance policy. |
| other way. In addition, the amount you pay for | | | | Some critics believe that if you took the extra |
| the premium will never change which makes it | | | | money you'd pay in premiums and instead |
| easier when you're trying to budget. | | | | deposited it into a savings account or other |
| Another benefit is that you have access to the | | | | low-risk interest bearing account, you'd accrue |
| cash value the policy accrues. You can borrow | | | | more savings. True or not, whole life is an option |
| against the cash value just as you would another | | | | many people do take advantage of. |
| type of loan. No one has to approve a loan made | | | | And while it may not be the cheapest form of life |
| against your whole life insurance cash value. You | | | | insurance, it does seem to meet the needs of |
| are the one who gets to decide how you'll use | | | | those who purchase it. |
| the money. | | | | |