Many people take out life insurance to ensure that children or family members aren’t left struggling to pay a mortgage or other bills after their passing. It’s a way of helping to prepare for the future.
Even if you don’t have children or relatives, life insurance can be given to charities of your choosing, or you might wish to set up a scholarship. You can specify in your will how you want the insurance money to be used.
There are different types of life insurance, two of the most common are: Whole Life Insurance and Term Life Insurance. Whole Life Insurance is also called ‘permanent life insurance’. It’s more far reaching than Term Life insurance as it lasts for the duration of your life.
Whole Life Insurance has an insurance component and an investment component. To help grow your fund, a portion of your premiums are invested and managed by the insurance company. This is set up so you can pay your premium at a certain time and then forget about it. It’s a policy for people who want minimum fuss, but maximum financial growth.
To get the most out of a Whole Life Insurance policy, it’s best to set it up when you’re young and in good health, as insurance premiums don’t change over time.