What's the point of buying an increase in whole life insurance?

Extending life is like saving more and more piggy banks in insurance companies and taking them out when you need money. You can take some or all at once. Therefore, the increase in life expectancy brings us an increase in total cash.

So what's the significance of insuring the whole life insurance increase and who is suitable for it? Dad thinks.

If you meet the following conditions, you can consider taking out life increment insurance:

① Worried that the interest rate will continue to decline, and the income of bank savings and wealth management products will be lower and lower;

2 I have some spare money in my hand and have long-term financial planning, but I can't accept the loss of principal;

3 migrant workers and moonlight families want to urge themselves to save money;

4 social security pensions are not paid much, and I intend to prepare pensions for myself or my parents;

5 I want to prepare education funds, venture funds and marriage funds for my children in advance to prevent marriage risks;

⑥ If you want to realize the directional inheritance of wealth, you need a low-risk asset in the asset allocation scheme.

The whole life insurance program focuses on the rate of return. The yield of life extension is a place where misleading sales are easy to occur.

Whole life insurance has three "rates": the predetermined interest rate, the growth rate of insurance coverage (also called the rate of increase) and the actual rate of return.

We are concerned with the actual rate of return.

But the actual rate of return of different products is not small;

The same product, different insurance plans, different time to hold the policy, the yield is also different. The following is a direct conclusion: the predetermined interest rate:

Both are 3.5%, which is the highest interest rate that can be achieved by increasing life expectancy. The real rate of return will only be infinitely close, but lower than this value. Insurance coverage growth rate:

Individual products may exceed 3.5%, usually 3.5%. It's useless, just don't look;

Actual rate of return:

Also called IRR (internal rate of return), it is the final income we can get after insurance. It can be calculated by the cash value of the policy.

The actual rate of return is less than 3.5%. Note that compound interest is used here, not simple interest.

Getting a good income performance may be the significance of many people's insurance to increase their life. If you don't understand, please consult your father!