What’s the best cash value life insurance policy? That depends – what’s your budget? What are your financial goals? There’s no single answer that will be right for everyone. As frustrating as it may be to hear, we can’t just name a single insurer or policy and recommend it to everyone. And anyone who does that probably doesn’t have your best interest at heart. We’ll explain why – and how to choose the policy that’s right for you.
Here’s what we’ll cover:
Best Cash Value Life Insurance for Flexibility
Best Cash Value Life Insurance to Grow Wealth
Best Cash Value Life Insurance for Investors
Next Steps
➡️ Rather talk to a real person about life insurance? It can be easier that way – we get it. Call us at (800) 823-4852 and let us talk you through it all. Or click the button below to request a free cash value quote.
Request a Free QuoteBest Cash Value Life Insurance for Flexibility
If you’re looking for a policy with a few bells and whistles, universal life may be a good fit. Like any cash value policy, it covers you for your whole life. Technically, it covers you until the policy matures, at an age you select (90, 100, or even 120, for example). If you are still alive when it matures, the insurer will pay you instead of your beneficiary(ies).
But here’s what universal life offers that may be different from other policy types you’ve seen:
- Variable interest rate for your cash value growth. The insurer will periodically update the amount of interest you earn on your cash value. Contrast this with whole life, where the interest rate stays locked in for the duration of the policy. This is a handy feature when interest rates are rising, but may result in less interest if the prevailing rates decrease.
- No payment due dates. Universal life is all about flexibility. Instead of a required payment every month or year, you have the freedom to pay when you want. If you want to pay every other month, cool. If you want pay three times a year, cool. If you want to make one big payment every year, cool. If you want to do it differently every year, that’s also cool. As long as you keep the policy funded with the required minimum needed to cover the cost of your coverage, you can arrange those payments as you see fit.
- Variable payment amounts. Not only can you pay when you want, you can pay what you want. If you have extra cash, pay it forward. The next time you make a payment, if you’re short, it’s okay. It’s up to you decide how much you want to pay and when.
- Variable death benefit amount. Because the amount you pay in can vary, that means your death benefit may vary slightly, too, based on how much your policy currently contains. It also depends if you’ve pulled out any cash value through policy loans or withdrawals. We mentioned universal life’s flexibility – and that continues right on into the death benefit amount. If you’re ever unsure, your agent or insurer can give you current details and account status.
Good insurers to look for when it comes to universal life policies include Nationwide, MassMutual, Lincoln, New York Life, and lots more. We can give you quotes for policies from these carriers and more, since we work with over 40 of the country’s top insurers!
➡️ Rather talk to a real person about life insurance? It can be easier that way – we get it. Call us at (800) 823-4852 and let us talk you through it all. Or click the button below to request a free cash value quote.
Request a Free QuoteBest Cash Value Life Insurance to Grow Wealth
You may have seen financial strategies referred to online, like “be your own banker” or “use life insurance to grow wealth.” These strategies all use whole life policies.
Why?
Whole life policies are the only form of cash value coverage that offer a guaranteed, locked-in rate of interest.
That interest rate is set by the insurer when you buy your policy, and it will never change. That makes it easy to calculate how much and how fast your cash value is going to grow.
But making your minimum required payments isn’t how the “be your own banker” strategy works. For the first seven years you own your policy, you are not allowed to pay extra into your policy. If you do, the IRS will apply new rules that take away the benefit of tax-deferred growth for your cash value. But after those seven years, you are allowed to pay more into your policy than the minimum required monthly payments.
Financial strategists use this allowance to sock away large amounts of money in their life insurance and grow their cash value. Then, they borrow against that cash value with policy loans to buy real estate, make other investments, or start businesses. Yes, the policy loan comes with interest – which is partially offset by the interest the insurer will continue to pay on your cash value. That’s the feature of most interest to people who want to use whole life to grow wealth: the ability to continue to earn interest on large amounts of cash value while pulling money from that cash value via policy loans.
Why wouldn’t another type of cash value insurance work for this? Well, with universal life, your interest rate is variable. You’re not guaranteed to keep a certain rate. And with variable universal life, there’s the risk of loss through investment. Only whole life offers the stable, guaranteed growth that these clients want.
Good insurers to look for when it comes to whole life policies are carriers with “mutual” in the name.
With a mutual company, policyholders are part owners of the company and can be paid dividends when the company is profitable.
Mutual companies mean include MassMutual, Northwestern Mutual, Mutual of Omaha, and many more. We can give you quotes for policies from these carriers and more, since we work with over 40 of the country’s top insurers!
➡️ Rather talk to a real person about life insurance? It can be easier that way – we get it. Call us at (800) 823-4852 and let us talk you through it all. Or click the button below to request a free cash value quote.
Request a Free QuoteBest Cash Value Life Insurance for Investors
If you successfully manage and grow a portfolio of investments, you might prefer indexed universal life (IUL) or variable universal life (VUL). Both have the potential to grow your cash value faster than either whole or universal life.
- IUL. With IUL, you have the option to tie your cash value growth to market index gains. You aren’t actually purchasing any stocks – you’re simply choosing an index (NASDAQ or the S&P 500, for example). If the index gains points, the insurer will pay you more interest. If the index loses points, the insurer will pay you less interest (or maybe no interest – it all depends on the insurer). This policy type lets you take advantages of market upswings without the risk of losing any cash value on the downswings.
- VUL. With VUL, you have the option to invest your cash value in stocks or other securities offered by your insurer. Unlike the other policy types we mentioned above, this time, you ARE actually invested in the market. That means there’s the potential for losses. But there’s also the potential to grow your cash value faster than with a flat or variable interest rate. It’s not for everyone – but if you’re an active, informed investor, it may be a good fit.
Good insurers to look for when it comes to IUL and VUL policies include Guardian Life, John Hancock, Lincoln, MassMutual, Minnesota Life, Mutual of Omaha, and more. We can give you quotes for policies from these carriers and more, since we work with 40+ of the nation’s top-rated insurers!
➡️ Rather talk to a real person about life insurance? It can be easier that way – we get it. Call us at (800) 823-4852 and let us talk you through it all. Or click the button below to request a free cash value quote.
Request a Free QuoteNext Steps
So…what’s the best cash value life insurance for you? It depends! We can’t make a recommendation until we know more about your finances, goals, and needs.
Remember, the number one reason to buy life insurance is for the death benefit to protect your loved ones.
➡️ To get personalized help, call us at (800) 823-4852! We’ll help you estimate your needs, give you a quote, and help you apply for the policy that fits your life! Or click the button below to request a free cash value quote.
Request a Free QuoteActual results subject to change. Always consult your accounting, legal, and tax advisors about your circumstances before implementing any recommendations.