 TITLE: What Type of Life Insurance Should I Get? CONTENT: What Is Whole Life Insurance?\n-----------------------------\nThere are several types of permanent life insurance, of which _whole life insurance_ is the most common. Permanent life insurance differs from term life in two significant ways: It lasts as long as you live, and it has a cash value in addition to the death benefit (or face value). The cash value of a permanent life insurance policy grows tax-deferred over time. Once the cash value reaches a certain point, you have several options for using it.\n*   You can borrow against it without the need for a credit check, although any unpaid loan balance will reduce your death benefit. You can also use it to pay the premiums, eliminating any out-of-pocket spending on life insurance.\n*   You can withdraw some or all of it. The cash value of your permanent life insurance can be a source of income, and unlike most retirement savings vehicles, you can access it at any age. Withdrawing cash value will lower the amount of your death benefit; withdrawing all of it (called surrendering the policy) will cancel your insurance.\n*   You can trade it in to increase your death benefit. When you die, the cash value of permanent life insurance goes to the insurance company, not to your beneficiary. If you want that money to go to your heirs, you can usually exchange it for an equivalent increase in the death benefit.\nPermanent life insurance is significantly more expensive than term life insurance, and you risk losing the cash value if you don't access it before you die. For those who are maxing out other retirement investment vehicles, though, it can offer another way to grow their wealth and leave money to their heirs.\nWhole life insurance is the most conservative permanent life insurance option for those seeking both insurance and investment growth. The premium stays the same no matter how old you are, and the death benefit is guaranteed. The cash value comes from dividends paid by the insurer and is guaranteed to increase every year. However, you don't have a lot of flexibility with a whole life plan: You can't choose what you invest in or change the policy coverage once you've set up the plan.\n_Universal life insurance_, another type of permanent life insurance, offers a bit more flexibility. Cash value growth is guaranteed, but you may be able to modify your coverage or premiums.\nIf you're more comfortable with risk, you may be interested in _variable life insurance_. This type of permanent life insurance lets you choose where to invest your cash value—for example, in stocks, bonds or money market accounts—giving you the potential for greater returns. The tradeoff: Your cash value is not guaranteed.\nFinally, _variable universal life insurance_ combines aspects of universal and variable life insurance. You can select your investments, adjust your coverage and may be able to modify your premium payments. As you might expect, this is a riskier investment, with no guarantee your cash value will increase. END