The couple went from never considering life insurance to firmly choosing term life insurance. A few simple reasons may also help you who are struggling.

Before having children, Maurie Backman had no intention of buying life insurance. Although she and her husband share the mortgage and other living expenses, Maurie believes that her husband is capable of taking care of himself, so why buy a policy that only protects him? But after having children, the couple actually began to seriously consider life insurance.

After consulting a professional, they were told the difference between term life insurance and whole life insurance. In the end, they chose to purchase a term life insurance policy and they don’t plan to change it. Why?

1. Too expensive

According to Policygenius, a 30-year-old nonsmoking male who wants a 20-year, $500,000 term life insurance policy will only cost $26 per month, or $312 per year. Whole life insurance? $451 per month, or $5,412 per year.

“The reason I will never buy whole life insurance is that it’s too expensive! When I applied for life insurance, I don’t even remember how much the quote for whole life insurance differed from the term life insurance I ultimately chose, just that it was expensive.”

Although whole life insurance has some benefits that term life insurance does not, such as the life of the insured and the accumulation of cash value, Maurie cannot find a suitable reason for its high cost, so it is better to save money in other ways.

2. Lack of appeal

While the idea of ​​receiving a lump sum from a life insurance policy is appealing, and that’s one of the great advantages of whole life insurance, Maurie believes that rather than being locked into a high whole life insurance premium, the money saved could be invested in stocks or other assets.

“Assuming I save $400 a month by choosing term life insurance, and invest that money in stocks for 30 years, generating an average annual return of 10%, I’ll end up with around $790,000.”

“So, in this case, why should I pay more to a life insurance company instead of handling the savings myself? If I’m good at picking stocks, my portfolio might be better than a 10% return.”

“Also, if I don’t have an extra $400 to invest for a while, that’s OK. But with whole life insurance, not paying premiums for a few months could mean losing coverage, which is a risk I don’t want to take.”

Do you only want to buy term life insurance for a few dozen dollars a month?

Most life insurance companies in the United States provide free online quotes. After filling in basic information, health status (such as whether you smoke or exercise) and expected insurance amount, you can prepare a personal insurance policy and provide a personal rate quote based on your personal situation. However, due to the different background conditions of each insurance company’s policyholders, the rate setting rules are different. The actual cost is related to the policyholder’s personal health status and awareness, so the specific amount should be quoted in person for the most accurate inquiry.