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How Whole Life Insurance Works in 2021.

When you buy a whole life policy, you are buying both life insurance and a tax-free savings vehicle. Each year a growing part of your premium goes into the savings vehicle. The cash balance in it grows tax-free at an interest rate guaranteed by the insurer.

How whole life insurance works?

Most whole life insurance is sold by mutual companies such as Illinois Mutual.  They have a long history of paying dividends to policyholders on top of the guarantees. The dividends end up increasing both your cash balance and your death benefit.

You can tap the cash value by taking loans out against it. The loans are tax-free and don’t have to be repaid but reduce the death benefit your heirs will receive.

Don’t wait too long to buy whole life: The sweet spot for buying whole life is from age 30 to 45. That gives of time for the cash value to build up before retirement. In addition, people that age are unlikely to rejected by the insurer because of health issues, and premiums are cheaper because insurers expect them to be around for a long time.

If you are looking for a free quote on Whole Life Insurance or Any Type of Life Insurance click here


Daniel Rodriguez

Daniel is a Licensed Agent dedicated to helping his clients get the best solution. From Life Insurance, Health Insurance, and Supplemental Retirement. Licensed in over 20+ States.

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