julia92•14d agoOG Member

Whole life insurance vs term life - which side are you on?

I ran the numbers for my family and term life at $500k coverage costs me $30 a month while whole life quoted $220 for the same amount. Is the cash value buildup really worth that extra $190 a month for anyone here, or is it just a trap for people who want an investment wrapped in insurance?

2 comments

2 Comments

simonmoore14d ago

My 57-year-old back gave out last year and I spent more on chiropractor visits than the difference between those two policies, so I might not be the best example. I looked into whole life too and the numbers just didn't add up for me. The cash value grows so slowly that you'd need to keep the policy for 20+ years just to break even on those higher premiums. I put that extra $190 into a simple index fund instead, and now I have both the insurance and an actual investment I can touch. Whole life feels like it tries to be two things at once and does neither one great.

haydenp9512d ago

Hold on, you spent MORE on chiropractor visits than the difference between two insurance policies? That's insane. Like I knew back problems were expensive but that puts it in perspective. My dad messed up his back last year just bending over to tie his shoe and it cost him a fortune too. Whole life is a scam for most people though, you're right. I did the math once and realized you'd have to keep that thing for 25 years before you even saw a dollar of real growth. Index funds all the way, at least you can actually touch that money without jumping through hoops.