If you're in the process of buying life insurance you might be wondering what type of life insurance you should buy? Today with so many different types from whole life, term life, universal life, to variable life it can be hard to choose which is best for you. In this article you will learn which type is right for you.
First off, forget everything about the different types of life insurance I just mentioned because their are only really two different types, term life, which protects you for a specific amount of time, typically 10 to 30 years and then you have permanent life which will protect you for your entire life.
However the difference between these two types of policies is huge. The reason for this has to deal with how each one is set up. A permanent policy contains a cash value account. The purpose of this account is to help bring down the cost of insurance over time. For example, if you have a $150,000 universal life insurance policy and over the course of 30 years you save up a total of $100,000 in the cash value account you will only be really paying for $50,000 worth of coverage because the other $100,000 will be paid in full.
On the other hand with term life insurance it has no cash value account. In fact with a term policy you are only paying for the cost of insurance which is why these polices tend to be so much cheaper than whole life and universal life.
So which type of policy is right for you? If your a younger person or someone looking for childrens life insurance I suggest you go with a permanent policy because you will have the time to save up an cut the cost of insurance down over time.
If your someone who is older I suggest going with term life as a good elderly life insurance policy since it will be far cheaper than a permanent life insurance policy. On top of that as an older person you won't have the time unnecessary to build up decent cash value account to help lower the cost of insurance.
In the end follow my advice and you'll more than likely end up buying the right life insurance policy.
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