Term vs. whole life insurance

Almost every life insurance decision comes down to one question: term or whole life? They protect your family in very different ways, and the right answer depends on your goals and budget.

Term life

Term covers you for a set period — typically 10, 20 or 30 years — and pays a death benefit if you pass during that term. It's straightforward and inexpensive because it's temporary and builds no cash value. It's ideal for covering the years you have the biggest obligations: a mortgage, young kids, income to replace.

Whole life

Whole life is permanent — it lasts your entire life as long as premiums are paid — and it builds cash value you can borrow against. That permanence and cash value make it considerably more expensive than term for the same death benefit.

Side by side

• Cost: term is much cheaper; whole life can be 5–15× the premium for the same coverage.
• Duration: term expires; whole life is lifelong.
• Cash value: term has none; whole life builds it slowly.
• Best for: term = income replacement and temporary needs; whole life = lifelong dependents, estate planning, or guaranteed final-expense coverage.

Which should you choose?

For most families, term life provides the most protection per dollar during the years it's needed most. Whole life makes sense for specific goals — a lifelong dependent, estate planning, or guaranteed coverage that never expires. Many people use a large term policy for the core need and add permanent coverage only if a goal calls for it.