Is Term Life Insurance the Best for You?
It is only natural that you want to be sure your loved ones will have a financial safety net should anything ever happen to you. But maybe you are in a tight spot with money and savings are slim. Term life insurance is a great alternative to its more common counterpart because it has significantly lower premiums that are set at a fixed rate for the term of your policy. These kinds of life insurance plans can range anywhere from 5 to 30 years depending on what length of time is most suitable for your needs. If you have grandchildren heading to college in a few years or a spouse with costly medical conditions, a term policy is a great and inexpensive alternative to a permanent life insurance plan.
Another advantage to term plans is that they usually have a fixed payout. That means the benefit of a policy will be the same amount on the first day of the contract as it would be on the last. If you are purchasing a plan with dependents in mind, you can calculate how many years it will be until they are able to financially support themselves. For instance, a father with 3 children in high school would most likely not need a contract lasting longer than 15 years. But what if the term expires and you want to still be insured? Many companies will extend the term but you will be subjected to markedly higher premiums. Alternatively, you may purchase a permanent life insurance policy at a discounted rate, though the premiums will again still be higher than a term policy.