What is whole life insurance, and what are some of the benefits of this type of policy? I shared some insights with Ronda Lee and Paul Kim of Business Insider — here are a few of the main points.
- The cash value of a whole life insurance policy earns interest over time, and when you’re older you can use the money in your policy to offset the cost of insurance when you’re older — an alternative source of income, a way to pay off your premiums, and more.
- You can add riders to your policy when you first buy it — they will make your premiums more expensive, but it’s preferable to having multiple policies. Different insurance companies may have different rider offerings.
- Whole life policies are more expensive than term — consider a mix-and-match strategy where you buy both a term and a whole life policy to cover your needs. At the end of the term period, you’ll lose the value of the term policy but you’ll still have the value of your whole life coverage in place.
If you’re interested in learning more about what whole life insurance is and whether it’s right for you, I highly recommend you read the whole article from Lee and Kim — and speak with a financial professional.