How To Know If Universal Life Insurance Is Right For You
A universal life insurance policy is one that includes a life policy along with an interest-bearing savings account. The account allows the insured to pay money above the monthly premium to go toward the savings account. If the insured elects not to pay a premium in a given month, the payment is taken from the savings account.
How A Universal Policy Works
You might think of having a universal policy as the same as having a term policy with an added savings account. The universal life insurance policy is good for a set number of years, opposed to a whole life insurance policy that is good for the duration of your life. When the insured makes a premium payment, he pays an additional amount to go into his savings account. This savings account can act as a payment vehicle for the insurance policy itself in that when the insured does not make a premium payment in a month, the money for the payment is taken from the savings account to be paid toward the policy itself.
One key point to keep in mind about a universal policy is that this type of policy typically is not valid for payout until it is in place for at least 15 years. Any money that remains in the interest-bearing account upon death is paid to the beneficiary.
Benefits Of A Universal Policy
One primary benefit to a universal policy is that if you make enough payments during the beginning months and years of your policy, you may not have to make any other payments to keep your policy valid. The interest-bearing account plays a critical role in helping you pay for your policy. You can in essence pay off your universal policy early and not have to worry about making payments later in life.
Is A Universal Life Insurance Policy Right For You?
This type of policy is great for the individual who plans on paying off the life insurance premiums early in life. You may make greater premium payments each month and earn interest on these payments, while you wait for your need to use them. This is ideal for the individual who are not as effective as most at having stable income. You may make larger payments when you can afford them and not make payments when you can not, as long as money remains in your interest-bearing portion of your policy.
Most investment advisors suggest that a universal policy may be right for you, if you are expecting to need life insurance coverage into your 70s. This type of policy can help you pay for your premium early and provide you with the coverage you need. If you expect that you will not need coverage into your 70s, many advisors recommend that you have a term life insurance policy and then invest your money in a different retirement account like a 401k.
In all, a universal policy is terrific for those who want to plan for the future and expect to be married with families later in life than most other families. You should speak with a qualified agent to discuss the different types of policies available to fit your needs.
How A Universal Policy Works
You might think of having a universal policy as the same as having a term policy with an added savings account. The universal life insurance policy is good for a set number of years, opposed to a whole life insurance policy that is good for the duration of your life. When the insured makes a premium payment, he pays an additional amount to go into his savings account. This savings account can act as a payment vehicle for the insurance policy itself in that when the insured does not make a premium payment in a month, the money for the payment is taken from the savings account to be paid toward the policy itself.
One key point to keep in mind about a universal policy is that this type of policy typically is not valid for payout until it is in place for at least 15 years. Any money that remains in the interest-bearing account upon death is paid to the beneficiary.
Benefits Of A Universal Policy
One primary benefit to a universal policy is that if you make enough payments during the beginning months and years of your policy, you may not have to make any other payments to keep your policy valid. The interest-bearing account plays a critical role in helping you pay for your policy. You can in essence pay off your universal policy early and not have to worry about making payments later in life.
Is A Universal Life Insurance Policy Right For You?
This type of policy is great for the individual who plans on paying off the life insurance premiums early in life. You may make greater premium payments each month and earn interest on these payments, while you wait for your need to use them. This is ideal for the individual who are not as effective as most at having stable income. You may make larger payments when you can afford them and not make payments when you can not, as long as money remains in your interest-bearing portion of your policy.
Most investment advisors suggest that a universal policy may be right for you, if you are expecting to need life insurance coverage into your 70s. This type of policy can help you pay for your premium early and provide you with the coverage you need. If you expect that you will not need coverage into your 70s, many advisors recommend that you have a term life insurance policy and then invest your money in a different retirement account like a 401k.
In all, a universal policy is terrific for those who want to plan for the future and expect to be married with families later in life than most other families. You should speak with a qualified agent to discuss the different types of policies available to fit your needs.