Revealing the Truth About Term Life Insurance and Permanent Life Insurance
The insurance industry has a little secret they don't want you to know: historical data shows that less than 1 percent of term life insurance policies ever purchased will pay out a TAX-FREE death benefit annually. But before you start thinking insurers are scamming people or refusing to pay, there's a simple reason behind it - most people outlive their term policies.
Holding All Things Equal
Let's face it, there's a very low chance (99%) that you'll receive a Death Benefit for a Term Life Insurance Policy. It's just the way the numbers work.
Now, consider this: there is a 100% chance of life concluding at some point, but here's the catch - there's a very HIGH (100%) chance of receiving a Death Benefit for a Permanent Life Insurance Policy. It offers a more secure approach.
You might have heard some aggressive claims about a 9% interest rate gain for certain investments. However, it's essential to keep things in perspective. Click here to see historical dividend rates for Mass Mutual Life - a company that has maintained consistent dividends since the late 1800s, averaging 7+ percent dividends for the last 20 years.
Cash Value Life Insurance can bring some noteworthy advantages, including 5-7% dividend averages and significant tax benefits (Infinite Self-Banking). On the other hand, Term Life Insurance might seem like a budget-friendly option, but it often turns out to be a straight loss of money for the sense of security it provides. Remember, "You get what you pay for," and "cheap is cheap."
Considering the slim 1% chance of death for all Term Life Insurance Policy Owners out there, it's worth pondering whether a better strategy would be to split the difference. Here's a thought: Instead of putting all your resources into unpredictable markets or investing solely in a Term policy with low chances of a payout, consider allocating some funds to the smallest Cash Value Life Insurance Policy you can afford. This policy should lock in your health status and offer the flexibility to add more coverage as your financial situation evolves. It's a smart move that ensures you're protected and ready for whatever life brings.
Buy an Insurance plan that you are going to use. Learn more about hybrid mortgage insurance plans. Less expensive whole life and term condo plans that have a cash back option.