Guest Post: 7 Reasons For Buying Term Life Insurance
The world economy is in the toilet. It doesn’t take a financial planner to figure that out. One of the best ways to protect your family if you die is to buy life insurance. Now more than ever, people are purchasing life insurance to protect those they love in case they kick the bucket before their golden years. Yes, it’s true. Life insurance. It’s not just for busty blondes wedded to billionaires anymore. If you’re considering taking the plunge, you need to decide whether you’ll go for a term life policy or a different kind of plan. Here are seven reasons you should go for term life all the way.
1. Your Agent Can Shove The Commissions. If you find yourself in the ridiculously uncomfortable position of having life insurance quotes hurled at you by a sales agent while sipping tea in your living room, my condolences. If that insurance agent manages to convince you to opt for whole life instead of term, I urge you to bash your head against a wall repeatedly. Take your time, I’ll wait. Done? Great. On average, insurance agents get a few thousand in commission from selling you a whole life plan – compared to only a few hundred scored by signing you up for a term policy.
2. Universal Life Is Scary. The really scary thing about universal life is that no one really understands how it works. So let me try to break it down for you. Your premium goes into what’s known as the “bucket,” then the insurance company adds interest, the company takes out the insurance cost, which includes a mortality charge which increases the monthly expense and the administrative costs are taken out and divide by the profit and speculative… umm… did I lose you? Good, because I’m kind of confused myself. Let’s move on.
3. Whole Life Insurance Sucks. When you buy a whole life policy, you are responsible for paying a set premium – for the rest of your life. In return, you are handsomely rewarded with a paltry cash value. Guess what the company gets to do? Invest your money however they’d like and furnish you with almost no interest in return. Let’s hear it for getting your money’s worth!*
4. Term Life Insurance With No Exam Rocks. Let’s break it down to the morbid fundamentals. Life insurance companies like to place bets on when you’re gonna croak. They gather information about your health, well-being, your likelihood of jumping off a tall building, things like that. They take this information and plug it into a formula with average life expectancy information and the magic machine spits out the amount you’re going to have to cough up for coverage. If you buy term life coverage with no exam, then you cut out one more way they can up the price.
5. You Won’t Be Tempted To Pay Your Mortgage With Your Cash Value. With the crappy economy, many people are turning to the money accumulated in their whole life plan to pay the bills. While this may seem like an excellent solution in the short term, in the long run, it can equal financial meltdown. Term life plans don’t have a cash value you can borrow against, which effectively removes the temptation for the weaker among you. You know who you are.
6. You Never Have To Worry About Getting Hit By A Bus Again. Term life is great because you don’t have to stay up at night wondering what will happen if you die before you get old. Are you scared of getting into a plane wreck? Worry no more, you’re covered. Are you scared you might get hit by a taxicab while crossing the street on the way to work? How about being involved in a hot air balloon accident wearing nothing but your socks? I know, me too. Think about it all the time. If you have a term life plan, you can put those fears to bed once and for all.
7. Your Spouse Will Be Set If She Can Get Away With Poisoning You. Trouble in paradise? Well, with term life, you needn’t sweat it. Your wife will be well taken care of after she spikes your pancakes with antifreeze. That receptionist isn’t looking so hot now, is she?
* If your irony detector isn’t that sharp, let me translate: you’re getting screwed.
