Term vs Whole Life Insurance: Which is Better?

Term vs Whole Life Insurance: Which is Better?

When it comes to life insurance, choosing between term life and whole life is one of the most important financial decisions you can make. Each has unique benefits depending on your needs, budget, and long-term goals.

1. What is Term Life Insurance?

Term life insurance provides coverage for a specific period—usually 10, 20, or 30 years. If the policyholder passes away during the term, the beneficiary receives the payout. It's often cheaper and ideal for those seeking temporary coverage at lower costs.

2. What is Whole Life Insurance?

Whole life insurance provides lifelong coverage. It also builds cash value over time, which you can borrow against or withdraw. Though premiums are higher, it offers long-term financial benefits and stability.

Infographic comparing term life and whole life insurance: coverage, cost, cash value
Side-by-side comparison of term life and whole life insurance features

3. Pros & Cons

Term Life Whole Life
Cost Lower premiums Higher premiums
Coverage Duration Fixed term (e.g., 20 years) Lifelong
Cash Value No Yes
Flexibility Great for temporary needs Better for long-term planning

Conclusion

Choose term life insurance if you want affordable protection during high-responsibility years (like raising kids or paying a mortgage). Choose whole life if you value long-term wealth building and guaranteed coverage. The right choice depends on your financial priorities.

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