Deciding whether to invest in life insurance is a massive choice to make considering the amount of money this type of insurance requires. There are two main types of life insurance out there called term life insurance and permanent life insurance. Each of these comes with their own requirements, payment plans, and benefits. Knowing the main difference between them is key for making a smart investment decision. If you have any questions about this or have financial concerns, feel free to contact a Tennessee bankruptcy attorney for advice.
Pros and Cons of Term Life Insurance
Term life insurance offers coverage, but only for a certain period of time. This coverage can be used by your beneficiaries in the event of your untimely death. Not only can this help your loved ones escape potential financial problems, but this can help secure their future. One good aspect of term life insurance is that this is your cheapest option.
When it comes to term life insurance, you end up paying less money for premiums each month compared to other types of life insurance. These premiums can build up to a larger cash value for your beneficiaries compared to permanent life insurance. This means you would be paying less money a month and building up more money for your loved ones in the event of your passing.
However, with almost every kind of benefit, there are cons. The main con with term life insurance is in the name itself. Term life insurance means you will only be covered for a brief period of time. This varies based on the term insurance plan. Depending on the plan you choose, you may be covered until the age of 65 or for five or 20 years. In other words, your beneficiaries will not be covered by life insurance if you pass away after this time period ends.
Costs and Benefits of Permanent Life Insurance
Permanent life insurance may be more expensive with less of a payout in the end, but your beneficiaries are guaranteed coverage upon your death. Unlike term life insurance, there is no time limit for this type of insurance plan. As long as you keep paying the monthly premiums, you will be covered for the rest of your life.
Your life policy can also grow with time as you continue to pay the premiums. The cost of choosing permanent life insurance is less of a return on investment compared to term life insurance, but the benefit is you know your loved ones will be covered.
Bankruptcy Attorneys in Chattanooga, TN
If you are still unsure about whether you should choose term life insurance or permanent life insurance, then consider asking one of our lawyers for guidance. We have worked with clients from Chattanooga, Tennessee, and North Georgia on financial challenges related to bankruptcy for several years.
All you have to do is call a Bankruptcy lawyer in Tennessee at (423) 424-3116 for a free consultation today. You can also leave us questions on our contact page. Our team of bankruptcy lawyers are located in Chattanooga, Kingsport, and Tullahoma.