If you’re planning on buying life insurance, you probably want to know what kind of policy you should buy, and why that specific type of policy is best for you. Whole life insurance policies can be a great option if you want to make sure your family will be taken care of in the event of your death or if you want to maximize the amount of money your premiums payout in the long run. To learn more about whole life insurance policies in Dallas TX, take a look at the five reasons below!
Insurance For Your Family
Although your life insurance policy is just an investment tool, one reason you might want to consider purchasing your whole life is for what it could do for your family. For example, if you died without a will or without any other money in savings to leave behind, your whole life policy would act as an estate-management tool that helps ensure that your surviving family members are taken care of. With guaranteed lifetime income, your loved ones wouldn’t have to worry about losing their home or their car payments if you weren’t around anymore. In short, having a solid estate plan with life insurance makes sure that both you and your loved ones can rest easy at night knowing that things will be taken care of—no matter what happens.
Tax Advantages
When you take out a policy, your premiums go into an account and earn interest. That interest is part of your cash value, which grows tax-deferred until it’s withdrawn upon death or maturity of your policy (at age 95). As long as you use those funds to pay for qualified medical expenses or to purchase another whole life insurance policy, you won’t have to pay taxes on that money. Once your money is used to buy more coverage, it’s even protected from estate taxes! If there’s any money left over when you die, it goes back to your beneficiaries and doesn’t require federal estate taxes. Most other kinds of life insurance get taxed at death.
Retirement Planning
If you’re working with an advisor and haven’t looked at your entire financial picture, it’s time to get serious about retirement planning. Whether you have $5,000 or $500,000 saved for retirement, you need to take a close look at what you have and what you’ll need down the road. Often advisors recommend cash-flow analysis for clients and here’s why: If someone comes into their office and says they have $10,000 but that they owe $15,000 on credit cards with 17% interest rates—it’s not going to be easy to come up with a solid financial plan. Cash-flow analysis factors everything into account when looking at how much money is coming in vs.
Risk Management
Protecting your family is priority number one for many people, and having insurance is an important part of that goal. If you want to make sure your family will be taken care of if you’re not around, get whole life insurance. It’s often called permanent insurance because it lasts forever and provides benefits to beneficiaries even after your death. The coverage lasts as long as premiums are paid and can cover anything from funeral costs to outstanding debts—even college tuition. In addition, whole-life policies offer tax advantages that other policies don’t: Cash value can increase tax-deferred over time; withdrawals are tax-free when used for qualified purposes; additional cash value growth is also tax-deferred on most contracts, and a loan may be possible against policy values.
Flexibility
A whole life insurance policy provides you with complete flexibility. This is because of its cash value accumulation feature. If you face an unexpected accident, you can access your money immediately without having to wait for approval from an insurance company representative or invest time into filing paperwork and explaining your situation. This gives you financial freedom, which is something everyone desires. When it comes to insuring a loved one, purchasing a whole life policy guarantees that your loved ones will be financially secure even if something unexpected happens to you. No one expects such events to occur, but they do more often than we think, so it’s important to be prepared.
