The details involved in planning for your financial future can be dizzying for some people, and one subject that often seems impossibly complicated is life insurance.
Add to that the struggle Americans feel in dealing with a still-uncertain economy, and too often the result is that people take what seems– at first glance — the easy route: They buy one simple policy, if they buy life insurance at all.
Veteran insurance experts say it doesn’t have to be so complicated, and that people do not have to sacrifice their financial health just because they feel that they’re facing incomprehensible choices.
“The easy thing to do is to get help from an expert. “There are lots of options out there, and we can break down the choices and the benefits, which range from protecting your family and your assets to providing tax relief and even an income stream. The key is understanding all of the possibilities you have, and that’s what the experts are for. We can make the choices clear and provide life insurance quotes to help you evaluate all your options.”
Research shows, however, that many Americans are going for the simple approach. A recent study by the Life Insurance andMarket Research Associationthat revealed that only one person in 10 who has life insurance, has more than one kind. That’s half the number from 2004.
To understand what that means, it’s helpful to know the difference between the two fundamental life insurance approaches: Term and Whole Life.
Term life insurance is generally the most affordable when you first purchase the policy, and it provides coverage for a designated period – say five to 20 years. It’s often used to be sure there’s money to cover a specific debt or expense, like a mortgage or a child’s college education.
Whole Life, which is also called Permanent or Ordinary insurance, provides coverage for your entire life and comes with an array of nuances. It can also create a tax-deferred build-up of cash, which can be withdrawn or converted to an annuity. It generally costs more in the early years of coverage.