Should I pick Whole Life or Term?

The truth is that neither one is "better." They were designed to solve different problems, and each can be an excellent choice depending on your stage of life and what you're trying to accomplish.

The questions are: “Who are you” and “who do you need to protect?”

When Term Life Makes Sense

Term life insurance is designed to provide a large amount of protection during the years when your family would suffer the greatest financial impact if you passed away.

For many people, those are the years when they have:

Children living at home

A mortgage

Car loans or other significant debt

A family relying on their income

If you pass away or get sick during those years your family is going to have to move, give up on the mortgage, change schools, give up on college, etc.... Because term insurance only lasts for a specific number of years, often 10, 20, or 30 years, it can provide a much larger death benefit for a lower monthly premium than permanent insurance. It doesn't work long term because the price goes up drastically at older ages and you can easily outlive it.

If your goal is replacing your income while your family depends on it, term life insurance is often an excellent solution. It also frequently provides living benefits that will cover you if you become sick or disabled and mean that again...your family is protected when they need it.

When Whole Life Makes Sense

Whole life insurance is different. Instead of protecting your income for a limited period of time, whole life insurance is designed to remain in force for your entire life, as long as the premiums are paid. Many people purchase whole life insurance later in life when their mortgage is paid off and their children are grown.

At that point, their biggest concern is often making sure that:

Funeral expenses are covered

Final medical bills are paid

Small debts don't become someone else's responsibility

Their family receives money quickly when it's needed

Since these needs don't disappear with time, permanent coverage often makes sense. This way the policy is in effect all the way to the end of your life and you don't gamble on whether you will outlive it.

Many Families Need Both. Some people assume they have to choose one or the other.

For example, someone with young children may purchase a large term policy to protect their income while the children are growing up, while also keeping a smaller whole life policy that will always be there regardless of when they pass away.

The two policies aren't competing with one another.

They're solving different problems.

Which One Do You Need?

That depends on your situation.

If your family depends on your income, term life insurance often provides the greatest amount of protection for the lowest monthly cost.

If your primary goal is making sure your family doesn't have to pay final expenses or handle unexpected bills later in life, whole life insurance may be the better choice.

Sometimes the right answer is one.

Sometimes it's both.

The important thing is understanding what you're trying to accomplish before choosing a policy.

Our Approach

As an independent agency, we work with many different insurance companies. That allows us to recommend the type of coverage we believe best fits your needs rather than trying to fit everyone into the same solution.

If you're not sure which type of insurance makes sense for your family, our Free Family Protection Planner can help you estimate how much protection you may need and identify where each type of policy may fit into your overall plan.