Definitely, despite what some misinformed advisers may tell you. Whole Life first of all was never designed as an investment. While it is true you can accumulate more cash by buying term and investing the difference, my experience has shown that in most cases the average person, no matter how well intentioned, fails to keep up with the investment part. Investments are taxable as well whereas Whole Life is very tax friendly. I have seen many people in their 70's and 80's lose their life savings because of the high cost of long term care. Without life insurance they would have had nothing to help pay for the final expenses, leaving their families in a financial bind. For some people the cash value in their life insurance is the only savings they really have. I always recommend at least enough whole life to pay final expenses, allowing for inflation. If purchased at a young age it is not that expensive. After forming your insurance foundation, then you can begin accumulating cash using a combination of term and investments. Whole life insurance provides an excellent safety net for the average individual.
Agent Owner, Gilmore Insurance Services, Marysville, Washington State
Whole life insurance makes perfect sense as part of a finanical portfolio. It represents a safe, consistent choice that provides stability to a portfolio. It is very important that when reviewing choices at you consider RISK. It is just downright silly to compare a conservative product like life insurance with a hypothethical 12% return stock that actually doesn't exist. Doing so, amplifies a lack of understanding of RISK and RETURN on financial products. Certainty comes with lower returns, uncertainty offers possible higher returns. Should a portion of your portfolio have some certainty to it?
Whole Life Insurance makes a lot of sense for people that want to have life insurance for their whole life (hence the name). One of the benefits of whole life insurance over term life is that the policy never ends as long as the premium is paid. Whole life can also act as a savings account of sorts, building cash value that can be borrowed against in much the same way as a 401(k) retirement account.
I recommend reviewing your options with a licensed insurance professional, and seeing what life insurance options make sense for you.
Business Development Officer, T.D. McNeil Insurance Services, Fresno, California
This is really simple. If you love those who will survive you and want to make sure your passing doesn’t result in financial collapse, then buy life insurance. If that need is not going to go away, buy permanent insurance. If you want the company to guarantee that money will go to those you love, then buy a whole life policy. There are obvious differences in situations and other forms of life insurance may be more appropriate but for those who want their beneficiaries to get a check when the die, whole life is going to do that.
There are a lot of answers here which are all correct so I will take a little different approach. Asking the question When does Whole Life make sense is really talking about your situation. If you are looking to protect your family while the children are at home, then Whole Life may not be the best solution or if you have a loan such as your mortgage, Whole Life may not makes sense.
However, if you are looking for Lifetime Coverage with not only a death benefit guarantee, because I can give you a death benefit guarantee for a lot less, but a guaranteed cash value to use as necessary in the future years. Whole Life is also used in some type of plans for businesses which is required to be fully guaranteed as well.
This is a really good question! I am glad that you asked it, because it tells me that you've looked at the alternatives. Here's what I tell my clients: If you have the money set aside to cover your funeral expenses, pay your debts, and leave a comfortable income for your spouse or children that you know you won't have to dip into, then it doesn't. If you only need to cover a specific, ending debt like a college expense or mortgage, then it doesn't. However, if you are looking for a way to provide protection no matter how long you will live, ( You cannot outlive this coverage, unlike a term policy) this is your policy. If there is a chance that you may need to borrow money at some point, and your credit rating or history makes it unlikely that you will be able to secure a loan, this may be your policy. If you have a desire to move money to loved ones, or a charity in a way that is tax free to them, and not counted as income, this may be your policy. This kind of policy also makes sense if purchased when you are young, as the premiums are locked in at a low rate, and you are guaranteed coverage at that rate regardless of what health issues you may develop. I hope that helps, feel free to contact me with any questions or concerns that you may have, okay? Thanks for asking!
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I recommend reviewing your options with a licensed insurance professional, and seeing what life insurance options make sense for you.
However, if you are looking for Lifetime Coverage with not only a death benefit guarantee, because I can give you a death benefit guarantee for a lot less, but a guaranteed cash value to use as necessary in the future years. Whole Life is also used in some type of plans for businesses which is required to be fully guaranteed as well.