Buy Term Insurance Instead of Life Insurance – Insurance Magazine

It’s typical to purchase life insurance from an insurance provider. But, there could be an alternative. The following video will provide the reasons how term insurance might be an ideal choice.

In this segment of the Ramsey Show, Dave talks about life insurance as compared to the term insurance. Dave says life insurance is among the most expensive policies available. Whole life insurance can cost twenty times more costly than normal term insurance. As a substantial portion of life insurance money is utilized to finance savings accounts as part of the policy is described. This may seem appealing initially. However, this cash value only earns 1 to 1.5 per year. It’s a poor return. If you put this money into a mutual fund, you would be making about 5-10% annually. It is better to purchase the term life insurance first, and then put the remaining money into mutual funds that will return the highest rate of returns. Every person is different and has specific needs. In some instances, life insurance may be the best option.