Which is Best Term or Whole Life Insurance?

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Which is Best Term or Whole Life Insurance?

Best Term or Whole Life Insurance: What is best, Term or Whole Life insurance? Let’s compare which is better. At the age of 20 or 30, it is too common for young professionals that their friends or colleagues to push them to buy whole life insurance policies. According to one report, an average American changes 11 jobs in his whole life.

In the financial services industry, the salesman has to sell their product, insurance policies, investments, brokerage services, etc. because their most of the income comes from commissions on sales. In staring of the job, they do not have contacts or a market to sell their products so they turned to friends and family members.

Difference between Whole Life and Term policy

Whole life insurance and term policy are two different types of policies. Whole life insurance builds cash value in the end. After payments of premium for many years, cash value provides many options. Depending on the type of policy, policyholders may get paid dividends also. Whole life insurance is not only insurance but an investment. This is the main reason for the costliness of whole life insurance.

Term life insurance covers only the period of the policy and remains as long as a person makes the payments. When the term is over or a person stops paying a premium, there is nothing like a policy. Many people do not buy this policy because they believe that it is a poor investment.

Many Americans prefer to buy term policy because it has a relatively low cost. The policy amount depends on expenses that will be incurred in the future and suppose to cover it. For many families, 20 or 30-year term life insurance is a better option and cheaper also.

A whole life policy of $100,000 for a 20 or 30-year person may cost about $150 per month. The same person can get a term life insurance policy of $500,000 for 30 year period, by just paying $20 per month.

One another reason to buy a policy, people often say, we don’t want to disappoint our friends. They say, “Most of our friends are trying hard in life and to succeed. We want them to succeed in their new professions.” Some believe that selling whole life insurance or life insurance is like a multilevel marketing pyramid scheme where the brokers and top executives are making money by pushing the salesman to sell more.

Be honest and frank about saying ‘NO’ if you really don’t want to buy. Kindly explain the reasons for not buying to the salesman or friend who is selling whole life insurance. Read more articles on rozyjos.

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