Whole Life Insurance

What Is Whole Life Insurance?

Whole life insurance is a permanent plan that never expires, unlike a term life insurance plan. With a whole life insurance plan, your premiums are fixed and will never increase.

At the start of opening your whole life insurance plan, a fixed interest rate will be given to you. This allows the cash value to multiply year after year. Every month, a portion of the premium you pay will go to the cash value of the policy along with the cost of insurance. This guarantees a fixed rate of return that depends on the exact amount of money that goes into your savings. This allows the policy’s cash value to grow exponentially over time.

To review, here are some of the staples of a whole life insurance plan:

Fixed premiums that never increase
Cash value is accrued over time
Interest is paid on the cash value of the policy
Can act as a tax-free investment vehicle
You can borrow against the cash value of your policy
Eventually, the policy is paid up and premiums are no longer due

If you are interested in learning more about the benefits of a Whole Life Insurance policy, give Hercules Financial Services Group a call today.  We are standing by to answer any questions you might have and to help determine if a Whole Life policy is something that makes financial sense for you and your loved ones.

Pros and Cons of a Whole Life Insurance Plan

Benefits of a Whole Life Insurance Plan

Unlike term life insurance, a whole life plan has cash value. You can take out the cash as a loan or leave it in the plan to grow tax-deferred. For a whole life insurance plan, your responsibility is in paying your premiums. If you are able to do this, your beneficiaries will receive the full benefit along with the cash value regardless of when you die. 

Cons of a Whole Life Insurance Plan

With the many benefits of whole life insurance there of course is a few cons you should be aware of. For one, the premium on a whole life insurance plan is a bit more expensive than a term life insurance plan. 

With this, terminating the policy can be expensive, so if you decide to go with whole life insurance, it’s best to stick with it to the end. This plan also can take about 15 years to build up a substantial cash value. This means you should get started with this plan earlier in your life for it to have the best payoff. 

Who is Whole Life Insurance for?

While anyone can choose whole life insurance, it’s particularly helpful for certain people. Since whole life insurance has added cash value, this can be good if you have a spouse/ partner or dependents, like children, that rely on your finances. It’s better to be covered fully in this case. Also, if you have an estate or endowment, a whole life insurance plan can be great for covering this cost even after you’ve passed away. Hercules Financial helps lay out your life insurance options and aids you in choosing the best policy for you and your loved ones.  If you are interested in a whole life insurance policy, get in touch with us today!