For many people, variable life is an excellent product because it combines flexibility and bigger returns. But it also adds in considerably higher costs. The premiums are much higher than universal life, in part because the expense charges are much higher. Remember, your investments are paying not only for the cost of your term life insurance but also for the cost of the company’s investment managers. The purpose of life insurance is to protect your survivors.
Although you want to choose the right kind of policy for your needs, you’re not insuring yourself to make a killing on the market. So make sure that any policy you buy, especially a variable life policy, has a guaranteed death benefit. If you’re looking for a good return on your money and want to invest, particularly in a tax-deferred vehicle, you’re probably better off doing so through an IRA or 401(k).
Although you want to choose the right kind of policy for your needs, you’re not insuring yourself to make a killing on the market. So make sure that any policy you buy, especially a variable life policy, has a guaranteed death benefit. If you’re looking for a good return on your money and want to invest, particularly in a tax-deferred vehicle, you’re probably better off doing so through an IRA or 401(k).
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