I've had several people ask me what the real difference is between Whole & Term Life Insurance and which is the best option



for them. As much as I enjoy helping, the best that I can really do is explain the difference between the two and the pro's and con's of each type of policy. This will help you, the consumer, to know what you're getting into before you buy.

Whole life insurance provides insurance throughout your lifetime, as long as you maintain the premium payments. The policy will cover you up until your death or age 100, whichever occurs first. Some of the pro's of a Whole Life Insurance policy are that you will also build an account that has actual cash value. It works just like this. Some of your premium goes to buy life

insurance, while the rest is placed in safekeeping for the future. You may borrow against this account if you need to, but it must be paid back. This gives you a bit of piece of mind in case of expenses at college, auto repairs or any other of lifes little emergencies.

Some of the cons of Whole Life Insurance is that it can be expensive. The premium payments for whole life will be much higher than a Term Life policy would be. Another con is that as you get older the savings account feature becomes less attractive.

For someone just starting out, this makes more sense because they have their entire lives ahead of them, but for someone middle aged or above, I'd buy Term and invest elsewhere.

Term Life Insurance is just like it sound "Term". This means that you are covered for a certain time frame or a Term. You could buy a "10 Year Term", a "20 Year Term", "Recurring Term", Guaranteed Term", ect. Do you understand?

A Term Life Policy is also known as "pure life insurance" because that's all you're purchasing. Some differences between the two policies are, unlike Whole Life policies, there's no savings account that accumulates or to borrow against. You are simply paying for insurance. Another con is that, as stated above, some Term policies are only for that specific "Term" or time frame, not your entire life. Some Term policies, such as Guaranteed Term, can be rolled over, but that's another story. You need to visit my website below and I explain it there.

Most Term policies only last a specified period of time. An example of how this can be used would be for the "breadwinner" of

the household who is middle aged, the kids are grown, but still in college, he or she has been paying on their major assets, like their home, ect. for several years and they need some security to make certain that if anything happened, everything would be taken care of so that the family could go on without any issues, other than the loss of their loved one. A 10 or 20 Year Term Policy might be a good option for the fictional example above, depending on their individual living circumstances.

I hope that you understand now why it's difficult to give counseling to people without knowing their specific circumstances. Just learning the differences between these two more popular types of insurance policies should help you immensely in the future. Good luck!