Whole Life Insurance
Whole life insurance is a type of permanent insurance, which provides coverage for a lifetime.
Whole life insurance is a type of life insurance which provides coverage for an entire lifetime. The length of your policy depends on how long you live; coverage never expires as long as you pay your premium.
Whole life also allows for competitive cash value growth, which is not subject to market risks.
There are many different types of whole life insurance such as: 20-pay, 10-pay, single premium whole life, and paid-up at 65. All of which allow you to pay your policy in full at different points in time.
Additional reasons to purchase whole life insurance
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A major benefit of whole life insurance from a mutual company (i.e. Mass Mutual or New York Life) is that you will be eligible to receive dividends (subject to company performance). As a policy owner, you get to choose how you want those dividends “reinvested”, such as: paid-up additions, more cash value accumulation, or take the cash!
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If you reach a point where you no longer need coverage, you can turn in the policy and receive the cash value to add to your retirement savings or to use in any other manner you see fit. Current tax laws allow you to receive cash surrender value, up to the total amount of the premiums you paid, tax-free.
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You can apply your cash value to purchase reduced paid-up insurance. This allows you to maintain some of the death benefits to cover final expenses or provide a legacy for your heirs with no further premium required.