What does Clark Howard think about term and whole life insurance?


Kelsey Cruz

Kelsey Cruz

Blog author Kelsey Cruz

Kelsey Cruz is a feminist blogger from the city of brotherly love who is obsessed with bourbon, black blazers, and blow-out bars. She loves to cook and is always up to swap smoothie recipes. Mostly, though, she likes long walks on the Philly streets with her pit-boxer Henry of whom she will definitely show you pictures. Follow her on Twitter @kelsey_cruz.

Published June 29, 2016|2 min read

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In articles, the words that are slightly bolder and larger—the title and headers—are takeaways. They’re the tweets, the 140 character synopsis of the story. And if you don’t feel like reading the whole thing and instead want to jump to a specific part, the title and headers are where your eyes go. They’re the things, the info that we as writers want you to learn and remember.

So when Clark Howard writes an article entitled, "How To Shop for Term Life Insurance" and heads one of the sections with "Term life insurance is the way to go," you know he feels a certain type of way about the subject.

But why? What is it about term life insurance that makes Howard (and Suze Orman and Dave Ramsey) favor it over whole life insurance?

It's cheap

According to Howard’s video, 38 percent of people who don’t have life insurance say it’s because they don’t know how much they need or what type to buy. 65 percent of people who don’t have it say it’s because they think it’s too expensive. Fortunately, it’s cheaper than people think.

According to one study, 80% of people overestimated a life insurance policy's price by over $200.

It's simple

Buying life insurance — specifically term life insurance — isn’t complicated. Howard says, "You buy a premium that’s the same all through the years, only pays in the event you die, and you buy it for a ten to thirty year period. Simple, simple, simple!" What’s more, you can buy it yourself online instead of having to go to a brick and mortar shop.

It's consumer-friendly

For Howard and his team, the best life insurance to have is term, specifically portable level term life insurance. Portable allows you to continue the policy after you leave a job as long as you pay the premiums in full, level means your premiums do not increase, and term refers to the insurance being a death benefit only with no investment vehicle. (He also believes each spouse should have term life insurance, regardless of whether you’re a stay-at-home parent or in the workforce.)Clark Howard wants you to buy portable level term life insurance. Here's why that's the most consumer-friendly version of life insurance available:

  • Portable means that it's not connected to your job – most employer-offered life insurance isn't enough.

  • Level means that your premiums stay the same for the entire length of the policy. They won't increase as you get older and they won't increase if your medical condition changes.

  • Term means that your life insurance ends after a certain period of time. There are a lot of reasons that we and Clark Howard both believe that term life insurance is the best; check out our CEO Jennifer Fitzgerald's article in Huffington Post or watch the video below for more info.

Now, of course, you can do what you want when it comes to buying life insurance. You don’t have to listen to Suze Orman, Dave Ramsey, or Clark Howard. And you sure as heck don’t have to listen to me! But when three financial experts all believe the same thing — and practice what they preach — I think they may be onto something.