• Posted January 25, 2023

Costs That Whole Life Insurance Helps Cover

There are two types of life insurance: whole life insurance and term life insurance. Whole life insurance differs from term life insurance in that it doesn’t expire. This means that whole life insurance is often more reliable and can better help your loved ones when you die according to our certified financial planners in Hartford, CT.

Estate Taxes

Whole life insurance can help cover estate taxes. When you die, your family will probably have to pay taxes on the things you leave them. Paying these taxes can cut into the actual value they are getting from what you leave them.

Estate taxes on extremely valuable things (like real estate) can also be difficult to pay if your loved ones don’t have sufficient cash on hand. So, having whole life insurance can help cover the expenses of estate taxes. Your loved ones will be able to enjoy the things you leave them without the burden of having to pay additional fees.  Our certified financial planners in Hartford, CT can provide financial and estate tax planning services.

Burial Costs

Burial costs can be deceptively expensive because of how many things need to be coordinated and paid for. You can choose between either a funeral or a memorial service as your end-of-life celebration.

Memorial services tend to be simpler as they don’t include the casket. Regardless of what type of service you choose, whole life insurance will help pay for burial costs. This will help your family from going into debt immediately following your death. It will also take a great burden off their shoulders and allow them to mourn properly. 

Future Financial Needs

Another big difference between whole and term life insurance is that whole life insurance accrues a cash value that you can access while you are alive. This means that you can liquidate and use any of this value during your life once it becomes accessible. Having this cash value can help you out with future financial needs like mortgaging a new house, paying for further education, or providing for future children. You never know what you might need help financing in the future, so having the cash value from whole life insurance helps you build greater financial stability. 

Whole life insurance is typically more expensive than term life insurance. As you can see, though, this is because it covers a myriad of costs. These benefits can not only help your loved ones if you pass away; they can also help you and your family pay for things while you are still alive. 

Did you enjoy reading this article? Here’s more to read: The Biggest Mistakes Retirees Make With Their Finances

Contact Tenpath Financial Group for certified financial planning services in Hartford, CT.