Cheap whole life insurance isn’t something that most folks on a tight budget look for. Why? Because term life insurance is significantly cheaper than whole in nearly all cases.

However, if you’re determined to get cheap whole life insurance quotes then you should be armed with a full understanding of the ins and outs of whole life insurance so that you can choose the best policy for you within your budget. I’ll also explain a few ways that you can save money on your policy if you decide to go with whole.

What Is It?

Whole life is a life insurance and investment one-two punch. While term only covers you when you pass on, whole life insurance takes some of your monthly premium and automatically invests it in assets. The typical asset class found in whole life insurance policies are relatively low-risk securities and government bonds. It’s very rare for a whole policy to put your money behind speculative blue chips or risky angel investments. However, like any investment, there is a risk of losing your money in a whole life insurance policy.

And because whole life invests some of your monthly payments and covers you with a thorough life insurance policy, it’s going to cost much more than cheap term life insurance.

On the plus side this extra money isn’t lining the pockets of your insurance company –it’s going towards your retirement plan. In that way the money you put into a whole life insurance policy is an investment in your future. Also, because the policy becomes a real asset, you can use it as collateral for a loan or mortgage. Finally, your premiums are usually “locked in” over the course of your policy, which makes whole them similar to term.

Issues With Cheap Whole Life Insurance

Unfortunately, these are the only positive things most investment experts have to say aboutwhole life insurance. Here are some of the issues with it:

Little Control: With the advent of online investing, an average Joe has the same tools that were once only available to full-time stock traders. With this knowledge, some amateur investors can even outperform professionals (although it is somewhat rare). With whole life you’re basically handing over the control of your portfolio to your insurance company, who may or may not know what they’re doing. And if you like having your hand on the dial, having your retirement plan controlled by a stranger may make you a bit uncomfortable, which is understandable considering your retirement nest egg is at stake.

With the advent of online investing, an average Joe has the same tools that were once only available to full-time stock traders. With this knowledge, some amateur investors can even outperform professionals (although it is somewhat rare). With whole life you’re basically handing over the control of your portfolio to your insurance company, who may or may not know what they’re doing. And if you like having your hand on the dial, having your retirement plan controlled by a stranger may make you a bit uncomfortable, which is understandable considering your retirement nest egg is at stake. Fees and Commissions : In general, you want your fees to be as low as possible so you can get the most of your positive returns. Low commissions are one reason that more and more people are turning away from expensive mutual funds and towards exchange traded funds. Being fee-conscious is very important as an investor as the returns on most retirement plans average out to about 8% per year. If you can decrease your fee from 2.3% to 1.3% you’ve just increased your return by 12% compared to if you stuck with the higher-fee plan. And when it comes to fees, whole life has some of the highest in the investment world. Oftentimes the plan takes almost all of your return in the first and/or second year and lops off 3% of your dividends over the life of your policy. This is significantly more expensive than most other retirement plans.

: In general, you want your fees to be as low as possible so you can get the most of your positive returns. Low commissions are one reason that more and more people are turning away from expensive mutual funds and towards exchange traded funds. Being fee-conscious is very important as an investor as the returns on most retirement plans average out to about 8% per year. If you can decrease your fee from 2.3% to 1.3% you’ve just increased your return by 12% compared to if you stuck with the higher-fee plan. And when it comes to fees, whole life has some of the highest in the investment world. Oftentimes the plan takes almost all of your return in the first and/or second year and lops off 3% of your dividends over the life of your policy. This is significantly more expensive than most other retirement plans. Difficult to Monitor: As already stated, with nearly all retirement plans shifting online, you can usually track how your investments are doing whenever you like. Unfortunately, this isn’t the case with whole life, even if you go with a trusted company like AARP life insurance. That’s because your investments are now married with your life insurance –making it difficult to track performance and make changes as needed.

How To Get Cheap Whole Life Insurance Rates

If you’ve read the issues with whole life and still want to pull the trigger, here are some ways to get find an affordable whole life insurance policy:

Get Tough On Fees: In terms of your expenses, commissions and fees are second only to your monthly payments. life settlement overview tells that when there is a great financial instability, there comes in a necessity of a quick income and there are people who take advantage of it through life settlement investment funds.  And because fees tend to be quite high for most whole life insurance policies, it’s critical that you find the lowest fees possible. This may mean tough negotiating or playing two insurance companies against one another. It may seem a bit mean but it’s just the name of the game with cheap life insurance!

Nora

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Nora Deanda is a freelance artist and loves to share her pictures with the world. She is also fascinated by art and literature which is why she is here to share her insights of all that she experience with her creative mind.