Life Insurance

The Second type is called a permanent life insurance and to explain Permanent life insurance, (I use the analogy of purchasing a house).  When you purchase a house you get a whole list of benefits that renting an apartment doesn’t have. The house is yours. You own it. If you want to paint it in a zebra pattern, you have that ability. If you want to put bars on the windows, go for it. As long as you make the payments, that house belongs to you and the price won’t change. The house will build cash value, you can borrow against it (like a second mortgage) and the house is listed as an asset on any ledger sheet.  Here’s the thing, typically, buying a house is more expensive than renting an apartment. The house is more expensive and there are other financial consideration to keep in mind such as lawn up-keep, trash pick-up, not to mention big ticket expenses like replacing the roof or purchasing homeowners insurance etc.  Purchasing a house is the best option for some people, even though the cost is considerably higher, in most cases, than renting an apartment.  The Benefits are worth the cost to them.  Note: of course there are different types of permanent policies such as Whole life, Flexible universal life, Variable life, and Index universal life. They are all permanent however, different in many ways in regards to their “bells and Whistles”.  As in the book:”Juror number one” (that goes into this more) long and short of it the benefits can be tax free growth (such as a Roth IRA), lock in gains every year (so you don’t loose your gains), allows for access of your money for any reason, at any time and at any age without penalty; Allow you to keep your money invested for as long as you like without penalty; provide a large, income-tax free, payment to the person of your choosing if you died prematurely and can help you retire tax free (More below on this if interested).