Oh, perm (whole) you can use as an asset when taking out a loan, etc. It gains in value over your life. Term is more expensive the older you get and usually resets in price every year to every 5 years. If you talk to a good financial adviser, they will do a whole survey for you and let you know how much you may need (make sure they go though this with you or you might be oversold by some) and give you options based on the amount per month you can afford to pay.
Good financial decision depends on who you talk to. If you get a $500,000 policy, it costs you over 2X as much to have whole life vs term. When you die, your beneficiaries get the $500,000 regardless of what you paid in......Advantage term
They say you build cash value in your whole life policy so you can borrow against it when you get a certain value in the policy and then pay yourself interest on the loan. What's the difference if you get the same amount if you die. It doesn't matter how much cash value you have, you will never get more then what the policy says it's going to pay you......Advantage term EDIT: add in the fact that, if you decide to take out a loan against your cash value and you die, your family gets the death benefit minus the unpaid loan balance minus interest.....
Of course a financial planner is going to tell you that whole life is better. They get a bigger percentage of the premiums when they sell whole life.
I had whole life for a few years until I sat down and looked at what you get with whole life vs term and it suddenly becomes a no-brainer. Since a whole life policy will easily cost you over 2 times the rate of term for the same death benefit, why would you pay over 2 times as much in premium to get the same amount of insurance???????
The only advantage to whole life is, in certain instances after you build so much cash value you don't have to pay anymore premium because your cash value interest will pay the premium. I say who cares since you have to pay over 2x as much premium for 15-20 yrs to get that deal anyway and how much more did you spend to get to that point??????/
Unless I understand whole life wrong vs term, the only benefit of whole life vs term is to the person selling the policy...:yes: