Many working Americans identify their top life priorities as protecting their family, having enough money in retirement, and educating their children.
Did you know that owners of whole life insurance have access to a wide range of benefits to support those priorities?
Benefits
Guaranteed death benefit protection to help ensure a legacy[1]
Guaranteed living benefits such as cash value that can be applied toward things like the purchase of a new home, funding education or a business, supplementing retirement income, and charitable giving[2]
Guaranteed premiums that won’t change, once the policy is in force[3]
Potential dividend payments and additional growth[4]
Built-in tax advantages on both the cash value and death benefit[5]
Protection from disability or illness through the election of optional riders[6]
Protection from creditors, depending on your state[7]
Whole Life Myths vs. Facts
Take the mystery out of whole life.
Myth:
The whole life policy you own can increase in cost as you age or become ill and the premiums will go on forever.
Fact: Whole life premiums are guaranteed to never increase once the policy is purchased. There are various policy designs that can avoid “forever” premium payments.
Myth: Whole life is expensive.
Fact: While whole life costs more than term life, it includes many additional living benefits, such as cash value. Plus, it has a permanent death benefit, while you may outlive a term life death benefit.
Myth: Term life is a better option for most people.
Fact: Whole life offers permanent lifetime protection, while term offers only temporary protection. Consequently, people may use both for optimal protection and benefits.
Myth: People rarely use the living benefits of whole life when they’re alive.
Fact: Many people use the living benefits of whole life as a source for cash.
Myth:
The whole life policy you own can increase in cost as you age or become ill and the premiums will go on forever.
Fact: Whole life premiums are guaranteed to never increase once the policy is purchased. There are various policy designs that can avoid “forever” premium payments.
Myth: Whole life is expensive.
Fact: While whole life costs more than term life, it includes many additional living benefits, such as cash value. Plus, it has a permanent death benefit, while you may outlive a term life death benefit.
Myth: Term life is a better option for most people.
Fact: Whole life offers permanent lifetime protection, while term offers only temporary protection. Consequently, people may use both for optimal protection and benefits.
Myth: People rarely use the living benefits of whole life when they’re alive.
Fact: Many people use the living benefits of whole life as a source for cash.
An Alternative Asset Class
Did you know that whole life is considered an asset class that can help diversify your portfolio?
The cash value in a whole life insurance policy can help you manage risk when combined with a mix of fixed assets (like bonds) and equity assets (like stocks). Additionally, it’s insulated from market volatility, potentially increasing rewards. So, it’s there when you need it — now, or in the future.
Find out how whole life insurance can help reduce overall portfolio risk and protect portfolio performance, potentially increasing reward.
While term insurance can protect you in the short-term, the right amount of whole life protection you may want depends on where you are in life, who depends on you, and your earning potential. Generally speaking, the younger you are, the more years of income you may need to take into account when deciding on the right policy amount for you.
30x Income
30x Income
20x Income
20x Income
15x Income
15x Income
10x Income
10x Income
5x Income
5x Income
The Importance of Protection First
What does protection first mean? While saving for retirement and paying down debt is important, it shouldn’t come at the expense of adequate protection and coverage for you and your family. The most financially confident Americans are more likely to prioritize protection and own the right tools to help get the job done.[8]
Start Building Your Whole Story
There’s more to whole life insurance than you may already know. Check out our whole life resources page to find out more about the ways it can help you live with greater financial and emotional confidence.
If you choose life insurance from a mutual versus a stock company, you’ll know that the company’s long-term interests are aligned with yours as a policyholder.
There’s more to whole life insurance than you may already know. Check out our whole life resources page to find out more about the ways it can help you live with greater financial and emotional confidence.
If you choose life insurance from a mutual versus a stock company, you’ll know that the company’s long-term interests are aligned with yours as a policyholder.
1All whole life insurance policy guarantees are subject to the timely payment of all required premiums and the claims paying ability of the issuing insurance company. Policy loans and withdrawals affect the guarantees by reducing the policy’s death benefit and cash values.
2Policy benefits are reduced by any outstanding loan or loan interest and/or withdrawals. Dividends, if any, are affected by policy loans and loan interest. Withdrawals above the cost basis may result in taxable ordinary income. If the policy lapses, or is surrendered, any outstanding loans considered gain in the policy may be subject to ordinary income taxes. If the policy is a Modified Endowment Contract (MEC), loans are treated like withdrawals, but as gain first, subject to ordinary income taxes. If the policy owner is under 59 ½, any taxable withdrawal may also be subject to a 10% federal tax penalty.
3Guaranteed premium payments are required to be paid EACH year of the policy to lock in the guaranteed benefits and if not paid, the policy may lapse.
4Dividends are not guaranteed. They are declared annually by Guardian’s Board of Directors. The total dividend calculation includes mortality experience and expense management as well as investment results.
5Guardian, its subsidiaries, agents, and employees do not provide tax, legal, or accounting advice. Consult your tax, legal, or accounting professional regarding your individual situation.
6Riders may incur an additional cost or premium. Rider benefits may not be available in all states.
7State creditor protection for life insurance policies varies by state. Contact your state’s insurance department or consult your legal advisor regarding your individual situation.
8The Guardian Study of Financial and Emotional Confidence™, 2021.
Disclaimer
The total dividend calculation includes mortality experience and expense management as well as investment results. For a whole life policy that is not a Modified Endowment Contract (MEC), if the amount of dividend payments used to repay the loan principal or interest exceeds the cost basis (cumulative premiums) of the policy, the excess dividend payments may be subject to income taxes.
1.5X
