Whole life insurance
Updated for plan year 2026
In plain terms
Whole life insurance is a type of permanent coverage that lasts your entire life, has a level premium, and builds a cash value you can borrow against. It costs roughly ten times as much as comparable term coverage, and it fits narrow situations (estate-tax planning, a lifelong dependent, business succession) far more often than it is sold.
A plain example
A $500,000 whole life policy might cost several hundred dollars a month versus a few dozen for the same term coverage. The extra premium funds the cash value and lifelong guarantee.
Why it matters
Whole life is heavily marketed as an investment, but its returns are modest and fees high; most families are better served buying term and investing the difference. It's the right tool only for specific, less-common needs.