“Different strokes for different folks.”
When it comes to life insurance, it’s important
that you keep that saying in mind.
Most people are familiar with “whole” life insurance.
This is the kind of insurance where you will get back a certain amount of money when it
“matures” at the end of the insured period.
What you may not know is that there is another
form of life insurance called “term” life insurance.
Similar to whole life insurance, when
you get a term life policy, you pay a sum of money (the “premium”) to the insurance
company, and in exchange the company promises to pay out a certain amount of money should
you die during the period for which you are covered under the policy.
In other words, you
are buying insurance coverage for a certain period of time.
But unlike whole life insurance,
you will not get back any money at the end of the insured period when you buy term
insurance.
You may be saying to yourself, “But won’t I be throwing money down the drain?
After all, I won’t get back a single penny after the insured period!”
Hey, I understand how
you feel. But rest assured that term insurance is still a very idea, and I highly
recommend that you use it to your advantage.
So, why should you still consider term
insurance?
Well, one advantage of term insurance is that it’s cheap. In fact, for the same
amount of insurance coverage, the premium for a term policy is only a small fraction of the
whole life policy’s premium.
And this is why term policies are a great way for you to make
sure you are sufficiently covered. If you’ve never checked out the premiums of a term life
insurance, I highly suggest that you go do it soon. You’ll be surprised at how cheap it is
to bump up the insurance coverage for yourself!
Plus, you can use the money you save from
the lower premiums to invest in some other areas that can potentially generate higher
returns for you. This strategy is generally known as “buy term and invest the difference”,
and it’s something I recommend that you take into consideration as you do your financial