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Oct 4 2010 9:36 AM

I'm not sure if I should buy term life insurance or a whole life policy--what's the difference?

Term life insurance is the traditional life insurance policy. As its name suggests, term life insurance covers a specific period of time. For instance, new parents may buy a policy to protect their growing family. A 30-year term policy would provide coverage until after their children have graduated from college, and they have been able to stash away some money for the surviving spouse's retirement.

Term life insurance is the most affordable life insurance policy, if you are young and healthy. It is also the easiest to buy. All you have to do is figure out how much coverage you need to provide for your spouse and your children, and the length of the term. Once you have determined your family’s needs, you are ready to apply for life insurance quotes.

On the other hand, whole life insurance provides coverage until your death. However, whole life insurance policies are more expensive than term. They include insurance in addition to an account that allows you to build cash in a tax-deferred account.

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Laura Adams is a personal finance expert and award-winning author who is Senior Insurance Analyst for InsuranceQuotes.com. She represents Bankrate Insurance’s web properties in the media and works as an advocate to make sure consumers protect their financial futures by having the right kinds of insurance.

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