Whole Life Insurance: Longest Term Limit
A whole life insurance policy is unlike any other type of life insurance. With a whole life insurance policy, the policy can be used as a way to build a substantial nest egg as after a couple of years of premium payments, the money contributed actually goes to funding the death benefit. The money for that death benefit accumulates and after a period of time, policyholders can access that money by borrowing against the principal. Until that time, the money that is stored away is invested by the whole life insurance company and the profit is tax-deferred until withdrawal.
From the day you first purchase the whole life insurance policy to the day you die, as long as you pay the premiums you will have this lifetime benefit. The longest whole life limit for this type of policy is based on a personal preferences of the policyholder in conjunction with the “paidup date ” they choose. The “paid up date” is when all the premium payments for the whole life insurance policy have been submitted and it becomes completely funded. Once funded, the policyholder may borrow against the investment or if they die, their beneficiaries will receive the money.
Whole term life insurance will be issued to anyone between the ages of 0-99, but of course the later in life you choose to invest in a policy, the more costly it will be. The longest whole life limit can stretch into multiple decades, just like mortgages. Both are extremely costly investments that may take decades to fully invest and fund, which is why thirty years may generally be common for the longest whole life policy.
Securing and understanding a whole life insurance policy is one of the most difficult investment strategies to fully understand. If you are interested in learning more, contact a life insurance specialist to help you out.