How Much Does Universal Life Insurance Cost?

 How Much Does Universal Life Insurance Cost?

The cost of a universal life insurance policy depends largely on individual factors like:

  • Your age
  • Your health 
  • Your lifestyle and the risks it presents
  • Your coverage amount

Because universal life insurance includes a cash value component, these policies have significantly higher premiums than standard term policies. According to Lewis, the cost of a universal life policy will be many times the cost of a term policy.

Because of this, most experts don’t recommend universal life insurance. Instead of buying universal life insurance, you’ll be better off buying term life insurance for the period that you need it, and then invest the money you save on premiums into mutual funds, index funds, or ETFs, says Schneider. That way, your beneficiaries will still get a death benefit if you die, but while you’re living, your money will grow much more quickly than the money market rates offered by a universal life insurance policy.

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