Today, it is generally a well-accepted principle that term life insurance is always the cheapest route to go for everyone wanting or needing life insurance. And, it may be true if you’re only looking for very basic coverage and you only need life insurance for a short period of time, or if you can’t afford to do anything else right now. However, as is most often the case, there are many other factors to consider when deciding which type of life insurance to purchase. In the end term life insurance may not be, the best type of life insurance for everyone.
Consider, term life insurance is very similar to what it was like purchasing an automobile many years ago, when the automobile manufacturers offered a basic vehicle with virtually none of the options as we know of today. I can remember a friend purchasing such a vehicle built by Ford Motor Company in 1968, and the pickup truck not only didn’t have a radio, it didn’t even have a factory-installed heater. (It was used of course, and therefore it was very old when purchased.)
While most of the vehicles built in 1968 did have factory-installed heaters, most did not have anything like air conditioning, power brakes, power steering or an automatic transmission. When purchasing a car today, it’s rarely if ever the choice between a basic car and one with several options. In most cases it’s finding a car with all the options you want to fit your needs and unique situation. Consider, today there are the safety features such as Air Bags, Anti-lock brakes, and driver’s assist.
And, then there are the comfort features such as Bluetooth, maps, Cd players, remote start, heated seats, automatic trunk or tailgate openers, sunroofs, electric seats that remember the drivers’ specific settings, and also DVD players to entertain the children. Term life insurance is just like those older basic cars that offer excellent transportation, at the lowest possible price. And, for some customers where price is the primary consideration, term life insurance is exactly what best suits their needs, basic life insurance with no extras.
Obviously, for many customers, the other forms of life insurance – just like the new automobiles loaded with options – are the best choice, to fit their needs exactly.
Considerations when buying life insurance:
·How long will you need your life insurance?
·How will inflation affect your need for life insurance long term?
·Do you need a tax deferred savings plan to fund a child’s college education?
·Would you like to retire 5 to 10 years early, with a tax-free retirement income?
·Would you like to be able to pay off your home mortgage 5 to 10 years early?
·Would you like to reap the upside potential of the stock market, without the downside risk?
And, the list goes on and on… Today, there is much more to life insurance than just the protection. You should discuss the various options with your insurance advisor to determine which life insurance plan best fits your needs.