Insurance is never fun to talk about – especially life insurance – but that doesn’t mean the topic should be avoided altogether. It’s hard to think about what would happen to your loved ones and your financial affairs if you happened to pass away early, but doing so is one of the best ways to ensure your family’s stability if you were ever out of the picture especially if you have kids.
If God is willing, I want to have a long life and watch my son grow up, but I have to face reality that if that doesn’t happen, he deserves to have financial stability in his life and have the opportunity to go to college and pursue other aspirations. Term life insurance can help secure that.
Last year, I met with a representative of PolicyGenius who first introduced me to the ground-breaking platform that allows consumers to shop for the best term life insurance policy to meet their needs. Before I get into my review of PolicyGenius, I wanted to point out why I believe term life insurance is better than whole life insurance.
Term vs. Whole Life Insurance
Some of you may know what the noticeable differences are between the two, but I know there are a lot of people who don’t (I used to be one of them ) so I’ll explain.
Back when I was looking into life insurance policies, I favored whole life over term life for some reason. Since whole life insurance is for life, I figured why not just lock in a good price and never have to worry about a new life insurance policy again? While permanent life insurance may provide protection for your entire life, it accumulates a cash value over time that the policy owner can borrow against tax-free, or use for educational and retirement funding.
Whole life insurance is best for estate planning because part of your premium goes toward building cash value and the policy also pays dividends that make that cash grow as the years go by. In order to buy a suitable amount of actual insurance protection if you died, you’d have to pay a much higher premium than with term life.
With term life insurance, you choose a term between 10 and 30 years and pay a monthly premium based on how much you need to be able to provide income and assets for your children if one day you aren’t around to do it yourself. These plans don’t build cash value and are just in place if anything unfortunate happened. Therefore premiums are much lower and can start at $10 per month. In my opinion, if you:
- Are relatively healthy and expect you will live long
- Are not interested a tax-advantages and waiting around for the cash value whole life insurance plans offer
- Or, already have a solid saving and investment strategy in place
Stick with term life, pay a much lower monthly premium and invest the difference on your own instead.
A Life Insurance Mistake
I finally finished a pre-marital counseling course with my fiancé that we took with members of our church. When we got to the financial planning part of the course, I thought we had each other all figured out since we already talk openly about our finances regularly. One of our counselors just happened to have previously worked in the insurance industry and when my fiancé started telling him about his whole life insurance policy, the doubts I had about it were solidified.
Back in 2009, my fiance’s parents persuaded him to get whole life insurance and not knowing any better, he chose a policy that required him to pay a monthly premium for $25.00 that would only pay out $23,000, which is practically nothing if he kicked the can seeing as it wouldn’t even cover burial/funeral expenses and his debt.
Meanwhile, I was paying less than his monthly premium for a $250,000 term-life insurance policy. Needless to say, the counselor advised him to switch and I wholeheartedly supported the idea because that was not going to fly. He took the $300 cash value the policy built up over all those years and started looking at term life options.
We used PolicyGenius to weigh our term life insurance options. Here’s why I love them.
What PolicyGenius Does
Buying the right life insurance for you is a serious process that shouldn’t be taken lightly, but PolicyGenius smooths all that out and breaks down the technical terminology so you can find an ideal life insurance policy quickly and without all the hassle.
To begin, you simply answer a handful of questions about your needs, income, household, etc. and the platform automatically matches you with quotes from the top contenders so you can compare them side-by-side. If any policies interest you, you can fill out a quick and free 3-5 minute online application through PolicyGenius to learn more and set up a new policy.
- Pet Insurance
- Renter’s Insurance
- Long-Term Disability
Oh and did I mention all of this is free? PolicyGenius acts as the unbiased middle-man so you can obtain your quote, shop around, ask questions, and apply all for no charge. If you don’t currently have a life insurance policy through an employer or on your own it wouldn’t hurt to apply and see what you’re dealing with.
The Platform Educates you So you Can Make the Final Decision
When it comes to choosing the right type of insurance, the final decision will always be yours. After dealing with my fiance’s life insurance mishap, I now understand how important it is be aware about what you’re getting yourself into so you can make a conscious final decision that you are happy with.
PolicyGenius is not just in the business to help match you with the best insurance provider, they are also keen on educating you on the industry and the process. They have a helpful FAQ section on their site with answers to insurance questions you didn’t even know to ask, 101 guides, and free personalized insurance advice through their Insurance Checkup Portal that provides you with a customized to-do list after analyzing your financial safety net and your needs.
Whether you are 25 or 55, life insurance is a must is you have assets and loved ones to protect. If you choose term life, it’s a small price to pay for your peace-of-mind knowing that your loved ones will be stable and have the financial support they need no matter what.
Do you have life insurance? Do you favor term life or whole life?<?strong>
STOP Living Paycheck to Paycheck
You can't break free from the status quo when you're living like everyone else. Get one of the free spreadsheet tools I used to pay off $35,000 of debt quickly, build an emergency fund, and break the paycheck to paycheck cycle.