10 Pay Whole Life - Is this the right life insurance plan for you?
Have you considered how a life insurance policy that only requires 10 years of premium payments and maintains a death benefit that continues beyond age 100 can benefit you? So what is a 10 Pay Whole Life policy anyway? 10 Pay Whole Life is a variation of a whole life policy that typically requires premium payments to age 100 or beyond to make the policy, fully paid up. What does fully paid up mean? Fully paid up refers to the time when the whole life policy no longer requires premium payments to maintain the original death benefit. So, let’s discuss the many benefits of 10 Pay Whole Life to determine if it is the right plan for you.
Whole life insurance is a permanent plan of life insurance that provides a guaranteed cash value. Some carriers that offer whole life insurance also offer dividends in addition to the guaranteed cash value. The life insurance carriers offering them on their plans of life insurance do not guarantee dividends. The guaranteed cash value grows at a more rapid rate when the premium payments are shorter, such as the 10 Pay Whole Life plan.
Why would you choose to pay premiums in a 10 Pay Whole Life policy rather than pay the premiums over their lifetime? That’s a very good question! Some individuals in their peak income earning years may be in a more comfortable position to pay the significantly higher premiums of a 10 Pay Whole Life policy rather than pay lower premiums throughout their retirement until age 100 or beyond for a traditional whole life policy.
As mentioned earlier, the 10 Pay Whole Life policies will build substantially higher guaranteed cash value due to the type of policy that can be accessed by either cash surrender or policy loan to supplement retirement, pay off a mortgage or use for educational expenses. The guaranteed cash value will continue to grow after the policy is fully paid up. Dividends may continue to be paid by the carrier after the policy is fully paid up.
Grandparents and parents like the attractiveness of 10 Pay Whole Life because they can purchase a policy on their grandchildren or children and have the policy fully paid up in 10 years. The grandchild or child will have a fully paid up policy that will grow in cash value and can ultimately have ownership changed to the insured. When you consider purchasing your next life insurance plan, consider if the 10 Pay Whole Life plan is the right life insurance plan for you. It has many benefits that could be the right plan to meet your specific financial needs.
About the author: Ken Buccico holds a LUTC designation and has been in the life insurance business for 39 years. His wealth of experience empowers clients to make best possible decision regarding a life insurance policy. To explore the best life insurance option, contact Ken at 1-800-651-1953 or KBuccico@Pivot.com.