Life Insurance Vs. Savings Plan?

Mike Siegal

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Hi Friends,

Ok, go easy on me as I am newly licensed and trying to educate myself on Different types of insurance and top selling points.

A friend of mine said "a whole life policy" is better than a savings account??? Since i was studying MA, lately, his statement threw me for a loop.?

I tried doing some research on google but come up with Dave Ramsey (who i don't trust) and various other sites like bankrate.com, etc.

I thought i would asks the pros for a general synopsis of how a whole life policy is better than a savings plan.

I know you have to make payments to maintain your whole life policy, so, if you miss a payment, i'm pretty sure the plan is cancelled (after a period of time).

  • Can someone share with me, the basic bullet points on why a whole life policy is better than a savings plan?

Anyway, i sure appreciate it and
Thanks for your input!
 
I guess on how your defining "savings plan". I could make an argument that life insurance should be part of everyone's plan for the future.

I could even see an argument for using a whole life policy instead of a traditional bank savings acct. However there are much better options than that.
 
I think what your friend is really trying to say is if someone uses a savings account and they die earlier than expected, they won't have enough in that savings account to cover everything. In other words, if they save $50 per month it will be quite some time before they would save the same face amount that $50 per month in an insurance policy would get them.

You really can't compare them because they should be used in different ways, for different reasons. A client should really have both.
 
Life insurance is better and worse than a savings plan. It just all depends on what aspect you are comparing and what matters to you.
 
Different means for different purposes.
I know DHK has some good posts about it on the forums.

BNTRS also has a blog (I believe its a blog) that also has some good information on the working/concepts of what youre looking for. His blog has helped me greatly when I first started out. Podcasts are pretty informative as well and something good to listen/have in the background if the situation permits.

The Insurance Pro Blog

Then again the video DHK posted may answer majority of your questions already.
 
It is better... but its not either/or...you need both. Saving much of your money only in a savings account is not a great idea. Having an adequate amount in a savings account (emergency fund) is a good idea, but beyond that you should be saving in other vehicles. Life insurance would be (and is) my first choice.
 
Life insurance, savings plan

Depends on what life circumstances allow the saver/policy holder to retain.
 
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