Life Insurance: Term Life vs. Whole Life

Life insurance can be one of the most critical financial investments you make. The decision between choosing term or whole life insurance may not be an easy one; both have their own benefits and drawbacks. It’s important to consult with a financial advisor to determine which policy can be most beneficial for you.

What is Term Life Insurance?

Term life insurance is a policy designed to provide coverage for a set period of time, typically 10, 20 or 30 years. If you pass away during this period, your beneficiaries may apply for the determined death benefit, which is typically a lump sum used to cover funeral expenses, debts, or other financial obligations.

A tTerm life insurance is generally more affordable than a whole life policy. Individuals may choose this type of life insurance for a specific period in life, such as while paying a mortgage or covering a child’s college tuition.

What is Whole Life Insurance?

On the other hand, a whole life insurance policy covers the policyholder’s entire life instead of a set period. While premiums are typically significantly higher than those of a term life policy, your beneficiaries may receive the death benefit no matter when you pass.

Another important aspect of whole life insurance is the cash value component. This means that part of your premium goes into a savings account that grows over time. Some policies may allow you to borrow against it after a certain period has passed or a specific amount has accrued.

Which Policy is Right for Me?

Selecting a life insurance policy is a significant financial decision that requires many considerations. Contact the professionals at Swift Kennedy & Associates, Inc. today for more information and help choosing the best policy for your needs.

This blog is intended for informational and educational use only. It is not exhaustive and should not be construed as legal advice. Please contact your insurance professional for further information.