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 have access to a wide range of benefits to support those priorities?
Benefits
Guaranteed death benefit protection for life – ensuring a legacy[1]
Guaranteed cash value that can be applied toward things such as a new home, education, retirement, charitable giving, or funding a business[2]
Guaranteed premiums once the policy is in force
Potential dividend payments and additional growth[3]
Built-in tax advantages on both the cash value and death benefit.[4]
Protection from disability or illness through optional riders[5]
Protection from creditors, depending on your state[6]
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
Are you aware that whole life is considered an asset class that can help diversify your portfolio?
The cash value in a whole life policy can help you manage risk when combined with a mix of fixed assets (like bonds) and equity assets (like stocks). What’s more, it’s insulated from market fluctuations, potentially increasing reward, 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 your own life, who depends on you, and your earning power. In general, the younger you are, the more years of your income you need to take into account when deciding on the right policy protection 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 do we mean by protection first? While saving for retirement and paying down debt is important, it should not come at the expense of adequate protection and coverage for you and your family. The most financially confident Americans prioritize protection and own the right tools for the job.[7]
Start Building Your Whole Story
There’s so much more to whole life than you may already know. Check out our whole life resources page and find out more about how it can help you live with greater financial and emotional confidence.
There’s so much more to whole life than you may already know. Check out our whole life resources page and find out more about how it can help you live with greater financial and emotional confidence.
Strategic alliance is at the core of mutuality. A focus on the long term prioritizes policyholders, one key benefit of owning insurance with a mutual company. Learn more about what drives our long term vision.
Strategic alliance is at the core of mutuality. A focus on the long term prioritizes policyholders, one key benefit of owning insurance with a mutual company. Learn more about what drives our long term vision.
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.
3Dividends 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.
4Guardian, its subsidiaries, agents, and employees do not provide tax, legal, or accounting advice. Consult your tax, legal, or accounting professional regarding your individual situation.
5Riders may incur an additional cost or premium. Rider benefits may not be available in all states.
6State creditor protection for life insurance policies varies by state. Contact your state’s insurance department or consult your legal advisor regarding your individual situation.
7The Guardian Study of Financial and Emotional ConfidenceTM, 2016.
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.
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