The Financial Planning Workbook (2025)

What is the difference between term and whole life insurance?

Term life covers you for a specific period (10, 20, or 30 years) and is 5-15x cheaper than whole life. Whole life covers you permanently and builds cash value over time. Most financial advisors recommend term life for the majority of families — the savings can be invested elsewhere for better returns.

When is the best time to buy life insurance?

The younger and healthier you are, the lower your premiums. Rates increase roughly 8-10% per year of age. Key trigger events: getting married, having a child, buying a home, or taking on significant debt. Even healthy 30-year-olds can lock in a 20-year $500K term policy for $25-35 per month.

Are life insurance riders worth the extra cost?

It depends on the rider. Waiver of premium (covers your payments if disabled) and accelerated death benefit (access funds if terminally ill) are worth considering. Child riders provide affordable coverage for kids. Return of premium riders are rarely worth it — the extra cost often exceeds what you'd earn investing the difference.

What is the difference between an insurance agent and broker?

An agent represents one company and can only sell that company products. An independent broker works with multiple insurers and can shop the market to find the best coverage and rates.