Whole vs Term Life Insurance: Cash Value

Whole vs Term Life Insurance is one of the most commonly debated topics in the minds of those first looking at buying life insurance coverage. It's a very common question that agents hear all the time. I'll address the differences between the two types of policies and also discuss cash values and how they benefit you in the future.
Whole life can best be defined as "permanent life insurance coverage". Some call it "Straight Life" or "Continuous Premium". There are three main benefits to Whole Life...
Guaranteed Premiums
With Whole Life, your monthly, quarterly or annual premiums NEVER go up. They stay the same for as long as you are living.
Guaranteed Death Benefit
The amount of money paid to your beneficiaries NEVER decreases, for as long as you live.
Guaranteed Cash Value
Whole life policies build cash value that can later be withdrawn, loaned against or left to simply build with compound interest. The interest rate is guaranteed and varies from company to company.
The above benefits of Whole life differ from Term insurance...
Term insurance is temporary insurance coverage that is only for the specified length of time that the policy is in force. This is commonly 1 year (Annual Renewable Term) or 5RT, 10RT, 20RT and 30RT. These policies are good if you need extra coverage for a specified period of time. They are not however, a low cost permanent solution. They provide only a guaranteed death benefit and builds no cash value whatsoever. Term insurance is good for adding extra death benefits to a permanent (whole life) insurance policy.