Moreover, term insurance is only cheap at the start when you are young. As you age, the premiums go up too! When you reach your 50′s, the premiums will be quite high compared to a whole-life plan that you started out with when you were in your 20′s or 30′s.

On the investment side, “if you know a better-yielding investment” comes with big IF’s. IF you know how to read stock charts, understand Relative Strength Indicators, Moving Average Convergence-Divergence, Bollinger Bands, Resistance-and-Support levels, Fibonacci retracements, fundamental versus technical analysis. IF you can DEVOTE time and effort to to track your investment every day when the market opens until it closes.

IF you are a semi-professional trader, then you MIGHT just have a chance at generating a better-yielding investment. But then again, why risk it? Why not leave the decision making to professional fund managers who do such analysis and investing decisions for a living?

Speaking of professional managers, you can opt for Mutual Funds or UITF, but why should you when you get the same fund management services PLUS income protection PLUS critical illness coverage PLUS total and permanent disability benefits with your Variable Life Insurance plan?

This is why I’m a firm believer that most people should get a Variable Life Plan instead of buying term insurance and investing the rest.

Similarly, if you get into an accident that leaves you totally and permanently disabled, your life insurance policy can give you a lump sum that can be used to pay for your day-to-day expenses and medical expenses.

If nothing happens to you, you get to retire on the funds that were accumulated via the investment portion of your variable life insurance plan.

Traditional whole life and variable life covers til the age of 100.

If not, you can get a variable plan where the insurance co. protects your life and you can also get better yields than just parking your money ‘safely’ in the bank.

Different plans for different people.

You can always invest the premium you are paying in a better yielding investment.

The insurance company makes money by profiting from the spread. For instance, they might offer you an ROI of 3% but that they invest your premium that has an ROI of 7%. The difference of 4% yield is their profit, risk-free.

Invest in Term-Life and use the premium to pay off debt. The avg. ROI on debt is 15%, which is far superior to the Variable Life insurance ROI.

If you are debt-free, you are doing something wrong. You are not leveraging your money.

a. lock-in period is 10y
b. one time payment but can do top-up.

I recently got a variable life insurance not just for protection in case of demise or disability but for critical illness as well. It’s great if I don’t die or get sick soon and even more wonderful because there’s money for me with the plan also acting as an investment.

Yes, initially, only a certain percentage of the premium is allocated to buy units of investments, but after about 2 years of paying, 100% of my premiums will be allocated to buy investment units. I can also specify the percentage of premiums that will go to bond funds, managed, growth, or equity funds. I chose equity funds (stocks) because of greater potential rewards and am in it for the long term. I can also redirect premiums from equity to bond fund, for example, or vice versa. It IS variable, lots of flexibility, unlike traditional plans and without the minimum investment amounts as with UITFs. Premiums can be as low as 1,000 pesos a month.

Yes, you can ask your insurance agent about it. Just make sure he or she is licensed to sell and familiar with variable plans, not just traditional life.

Dying young or living to old age, we need money in both cases. I think life insurance is the only product that you should buy when you don’t need it because you can’t buy it when you already need it.

I would suggest that “YES”, it is advisable for you to avail it. Just be sure you are buying it from a reputable and financially strong insurance company.

The insurance form will protect your dependents (wife and kid) and the savings form can be used for future like education of your kid, etc.

I would advise just in case you availed to ask the insurance agent as to what’s the percentage of the premium that goes to the “insurance” and “savings” form of the product. I think for you, since you are young, the better choice would be higher on savings than on insurance. I hope this helps.