One of the most important decisions you will ever make for your family is choosing to get life insurance. With life insurance, your loved ones are covered in the event of your passing.
If they are dependent on your income, your life insurance will provide for them in the event of your death. However, the life insurance market, much like any other market, is filled with competing products.
The main choice you will be confronted with when shopping for life insurance is whether to purchase term life insurance or whole life insurance. But what are the benefits of whole life insurance? Read this guide to find out.
1. Whole Life Insurance Never Expires
One of the most obvious whole life policy benefits is that, as the name suggests, it does not expire.
Other life insurance products have a term limit, often ten, twenty, or thirty years. After this period, your insurance policy expires and will have to negotiate a new one, often at a much higher cost.
A single whole life insurance policy will last a lifetime. As long as you pay your premiums, it will never expire.
2. Whole Life Insurance Has Tax Perks
When discussing what is whole life insurance good for, the first place you should look is your tax returns.
Not only are some premiums tax-deductible, but the death benefits received are non-taxable.
This is not the case with all life insurance death benefits. However, with whole life insurance, you and your loved ones do not have to pay a penny of the payouts to the IRS.
That means more of the money that your family needs and deserves.
3. Whole Life Insurance Builds Cash Value
One of the most attractive aspects of whole life insurance is that it constantly builds cash value.
As this guide to the cash value of whole life insurance explains, every premium payment you make is split up by the insurer.
Some of it goes towards the death payment, while the rest goes to the cash value of the policy.
This can be cashed in at any time, allowing you to build on your financial security and accumulate accessible cash.
4. Whole Life Insurance Policies Do Not Change
Another one of the major whole life insurance benefits is that your policy and your premiums will never change as long as you hold that policy.
That means that the insurers can never change the terms and conditions of your policy.
If you’re wondering “what does whole life insurance cover?”, you can have the peace of mind knowing that whatever coverage you pay for will always remain the same, no matter what.
5. Whole Life Insurance Offers Fixed Payments
Finally, another one of the key advantages of whole life insurance is that it offers fixed premiums and benefits.
Your premiums will stay the same throughout the lifetime of the policy, meaning you don’t need to worry about unexpected rate hikes.
In addition, you can rest assured that benefits will remain constant. This means that your loved ones will always receive a guaranteed amount of money as a result of your whole life insurance policy.
The Benefits of Whole Life Insurance and Your Personal Finances…
Overall, the main benefits of whole life insurance concern stability, which is crucial in personal finance.
To learn more about building a rock-solid financial future for you and your loved ones, make sure to consult our Finance guides today for expert advice and information.