Dear Insurance Adviser,
What’s the recommended type of life insurance to have? Term life, whole life, universal or variable?

Thank you.
— Borrowing Blues

Dear Borrowing,
When it comes to life insurance, too much energy is devoted to which type is best. Yet it’s not the type of life insurance that will matter to your survivors. They won’t care whether your policy was inexpensive term life insurance or more expensive permanent or whole life insurance. What will matter to them is the amount of death benefit they receive. That’s all that they will care about.

When you buy life insurance on yourself, it’s different from buying any other type of insurance. It’s different because you won’t be there to collect it. So, in that way, buying life insurance — regardless of the type of life insurance — is a true act of love for those dependent on you. The best life insurance policy to buy is the one that will give your loved ones more than enough money on which to live comfortably. (For example, you’d want 10 times your income if you have a growing family.)

If you earn enough to afford permanent life insurance with cash values and other benefits, and those benefits are important to you, there’s no problem as long as the amount of life insurance payable to your family isn’t compromised. Just don’t make the mistake that many people make of buying permanent life insurance and forgoing death protection in favor of living benefits because you can’t afford to buy all the coverage you need right now.

Remember that losing you will be emotionally devastating for your family. Having plenty of life insurance, no matter what type of life insurance, will ensure that the loss won’t be financially devastating as well.

I hope that helps!

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