FRIDAY, MAY 21, 2021
Why Life Insurance Is Better Than Putting Money Into a Savings Account
Saving money is always an important step in creating financial security. Most people should have some money in their savings account. It can provide financial protection if you lose your job or face an emergency situation.
Yet, you also need to think long-term. Once you establish a savings fund and have money to pay your bills and live comfortably, consider investing in life insurance. Life insurance can be an affordable way to save money well beyond what a basic savings account can offer.
A Whole Life Insurance Policy Offers Long-Term Benefits
Whole life insurance remains in place from the time you buy it until the day you die. You will make premium payments on an ongoing basis. As long as you continue to pay, the policy remains in place.
Some of these policies offer cash value accounts, which allow you to borrow against them throughout your lifetime. This can be a very affordable way to pay for investments, debts, medical bills or purchases. Moreover, these policies often pay you a dividend when they perform well.
Benefits of using life insurance as a savings opportunity may include the following:
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There are usually no taxes on the amount of money you earn through this type of investment until you withdraw funds. You should connect with a tax professional to learn more about this. Tax laws do change.
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You can earn money from the investment over the lifetime of your policy ownership. This type of earning tends to be higher than what is typical of a savings account.
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You can borrow from the policy over time. This tends to be more affordable than using the funds from a personal loan or credit line.
Keep in mind that every policy is a bit different. Learn more about the options for you.
Of course, you do need to have some level of standard savings available to you, and you should not consider a life insurance policy as an alternative to a savings account. You cannot take money out of a life insurance policy immediately. Nor do you want to simply rely on life insurance for savings. For that, you need money in the bank.
However, a life insurance policy can be an important part of your overall financial portfolio. It can help you to build your wealth. It also provides a security blanket should something happen or if you die unexpectedly. You do not have to worry about how your family will survive in this. That can be worth the investment in this policy on its own.
For more information on life insurance, contact one of our agents today.
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It is not be used as a substitute for competent insurance, legal, or tax advice from a licensed professional
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