Thrivent's Whole Life Insurance: Is It Worth The Investment?

Thrivent offers whole life insurance as a permanent life insurance option. Whole life insurance is a type of insurance that provides coverage for an individual's whole life, as long as they continue to pay the premiums. Thrivent's whole life insurance combines a death benefit for beneficiaries with a cash value component that the policyholder can access during their lifetime. The death benefit can help beneficiaries with everyday expenses, paying off loans, funeral costs, etc. The cash value component allows the policyholder to borrow against the policy tax-free. Thrivent's whole life insurance is also customizable with various riders and options.

Whole life insurance cost

Thrivent does offer whole life insurance. Whole life insurance is a permanent life policy that provides coverage for your entire life, meaning it never expires as long as you pay your premiums. It has a death benefit for your beneficiaries and a cash value component for you. Whole life insurance typically has a higher price tag than term life insurance because of the lifelong coverage and cash value component.

The cost of whole life insurance depends on a number of factors, including the total coverage amount, premium payment frequency (monthly, quarterly, or annually), and relevant health information such as chronic illness or smoking habits. For example, a $500,000 whole life insurance policy costs an average of $451 per month for a 30-year-old non-smoker in good health. The same person might pay $308 per year for a 20-year, $500,000 term life policy. Whole life insurance policies usually have higher premiums than term life policies because the coverage lasts a lifetime and the policy typically includes a cash value component.

When deciding on a whole life insurance policy, it is important to consider the company's financial strength rating, the number of complaints to state regulators, and the availability of online purchases. Additionally, the policy's eligibility age range, minimum and maximum coverage amounts, and potential to earn dividends should be taken into account.

Thrivent's whole life insurance offers fixed premiums, a guaranteed death benefit, and cash value. Their financial advisors can help determine the best type of life insurance and coverage amount based on individual needs and budgets. Thrivent was named one of America's Best Insurance Companies of 2024 by Forbes, recognizing their financial security and peace of mind offered to clients.

Whole life insurance features

Thrivent offers whole life insurance with a range of features. Here is a detailed overview of the key features:

Guaranteed Lifetime Coverage

Thrivent's whole life insurance provides coverage for the entirety of the policyholder's life, as long as premiums are paid. This means that beneficiaries will receive a payout, and the policyholder can have peace of mind knowing their loved ones will be financially protected.

Fixed Premiums

Premiums for this type of insurance never increase, even as the policyholder ages or their health changes. This provides an advantage over term insurance, where premiums are typically based on the age of the policyholder when they apply. Fixed premiums can make whole life insurance more affordable in the long run.

Guaranteed Death Benefit

The death benefit is guaranteed and tax-free for beneficiaries. This benefit can help cover funeral costs, sustain the lifestyle of dependents, or be donated to charity.

Tax-Deferred Cash Value

Whole life insurance accumulates a cash value that can be accessed during the lifetime of the policyholder. This cash value grows tax-deferred, and the policyholder can borrow against it or use it for large purchases or emergencies. The cash value can be a useful safety net and allows the policy to function as an investment-like asset.

Potential Dividends

Whole life insurance policies may earn dividends, which are distributed by the insurance company based on its financial performance. Dividends can be used to reduce premium payments, increase the policy's cash value and death benefit, or be paid directly to the policyholder.

Customizable Options

Thrivent's whole life insurance can be tailored to the policyholder's needs and budget. The death benefit amount and payment lengths can be adjusted, and optional add-ons, or riders, can be purchased to suit specific requirements.

Wealth Transfer

Whole life insurance can be used as a tool for transferring wealth to the next generation. By creating an irrevocable life insurance trust (ILIT), death benefit proceeds may pass to heirs outside of the taxable estate, helping them avoid estate taxes and preserve generational wealth.

Business Continuity

For business owners, whole life insurance can be vital to ensuring the long-term success of the organization. The payout from a whole life insurance policy can provide financial support and stability for a business after the death of the policyholder, who may be a key employee or the business owner themselves.

Investment Strategy

Whole life insurance offers a stable, lower-risk investment strategy compared to traditional investments like stocks and bonds. The cash value of the policy is guaranteed to increase, providing a steady accumulation of wealth over time.

Peace of Mind

Ultimately, Thrivent's whole life insurance provides financial security and peace of mind. Policyholders can rest assured that their loved ones will be protected and provided for, no matter what the future holds.

Who benefits from whole life insurance?

Thrivent is a holistic financial services organization that offers whole life insurance. Whole life insurance is a type of permanent life insurance that provides coverage for the entirety of the insured person's life. It is distinct from term life insurance, which only covers the insured person for a specific number of years.

Whole life insurance is beneficial to those who wish to secure their family's financial future. It provides a guaranteed death benefit, which means that the insured person's beneficiaries will receive a payout upon their death. This payout is typically tax-free, and can help to ensure that the insured person's family can maintain their standard of living, even after the insured person is gone. Additionally, the death benefit can be used to leave a legacy for heirs or be donated to a charity.

Another advantage of whole life insurance is that it offers a cash value component. This means that the policy has a savings element, which allows the policyholder to withdraw funds or borrow against the coverage, potentially tax-free. The cash value typically earns a fixed rate of interest, and the policyholder can access these funds at any time for any reason. This can be useful for large purchases, such as a home, or to supplement income during retirement.

Whole life insurance also provides peace of mind, as it guarantees coverage for the entirety of the insured person's life, regardless of their health status. The premiums for whole life insurance are typically fixed and do not increase with age or changing health conditions. This can make the rates feel more affordable as the policyholder ages and can even be fully paid off before retirement.

Whole life insurance as an investment

Thrivent does offer whole life insurance. Whole life insurance is a type of permanent life insurance that provides coverage for your whole life as long as you continue to pay your premiums. The premium amount remains the same for the life of the policy, regardless of your age or health. It also accumulates tax-deferred cash value each year, which can be used as an investment tool and savings account.

Benefits of Whole Life Insurance

• Lifetime coverage and guaranteed death benefit: Whole life insurance provides coverage for your entire life, as long as premiums are paid. This means your loved ones will receive a financial payout if you pass away, giving them security and helping them maintain their standard of living.
• Premium stability: Premiums for whole life insurance are locked in and never increase, even as you age or your health changes. This can provide peace of mind and make the policy more affordable over time.
• Tax-deferred cash value: Whole life insurance allows you to build cash value over time, which can be accessed for emergencies or large purchases. This cash value grows tax-deferred, and withdrawals may be tax-free if the policy is not a modified endowment contract.
• Potential for tax benefits: Withdrawals from the cash value of whole life insurance policies may be tax-free, and the death benefit paid to beneficiaries is typically tax-free as well.
• Investment growth: The cash value of whole life insurance policies is guaranteed to grow over time, providing a stable investment option.

Considerations and Drawbacks

• Higher premiums: Whole life insurance premiums are generally more expensive than term life insurance due to the built-in cash value component.
• Less flexibility: Whole life insurance offers less flexibility in modifying coverage and choosing investment options compared to other types of life insurance.
• Slower cash value growth: The cash value in whole life insurance policies can take a significant amount of time (10-15 years or more) to grow to a substantial amount.
• Limited investment control: The insurance company chooses how to invest the cash value portion of the policy, so you may have less control over the investment strategy compared to other investment options.

In conclusion, whole life insurance can be a valuable investment and financial protection tool, particularly for those who want stable, long-term coverage and are comfortable with the slower growth and limited investment control. However, it's important to carefully consider your personal financial goals, risk tolerance, and budget before deciding if whole life insurance is the right investment for you.

Whole life insurance vs term life insurance

Thrivent offers both whole life insurance and term life insurance.

Whole Life Insurance vs. Term Life Insurance:

Whole life insurance and term life insurance are two types of life insurance policies that offer financial protection for individuals and their loved ones. While both types provide a death benefit, there are several key differences between the two.

Coverage Period:

Whole life insurance provides coverage for the entire life of the insured, as long as premiums are paid. On the other hand, term life insurance offers coverage for a specific period, typically ranging from 10 to 30 years, or until a certain age. If the insured outlives the term, the coverage ends, and no benefits are paid out.

Premiums:

Whole life insurance premiums remain fixed throughout the policy, providing predictability. In contrast, term life insurance premiums may change over time, with level term policies offering fixed rates and other policies having variable premiums. Term life insurance premiums are generally more affordable, especially for younger and healthier individuals.

Cash Value:

Whole life insurance has a cash value component that grows over time, tax-free, and can be borrowed against or withdrawn. This feature makes whole life insurance a more complex and expensive option. Term life insurance, on the other hand, does not accumulate cash value, making it a purely protection-focused policy.

Flexibility:

Term life insurance offers flexibility in choosing the policy length to match an individual's specific needs, such as covering a mortgage or raising children. Whole life insurance does not require choosing a term length, as it provides coverage for the entire life.

Conversion Options:

Some term life insurance policies can be converted into whole life insurance at a later date, providing the option to extend coverage. However, whole life insurance policies typically do not offer the ability to switch to term life coverage.

Dividends:

Whole life insurance policies may pay dividends, depending on the insurance company's financial performance. These dividends can be used to boost the policy's cash value or provide other benefits. Term life insurance does not offer dividends.

Complexity:

Term life insurance is generally easier to understand and apply for, with straightforward coverage and benefits. Whole life insurance, due to its permanent nature and cash value component, is more complex and may require a more thorough evaluation of its features and potential returns.

In summary, whole life insurance offers lifelong coverage, fixed premiums, guaranteed cash value growth, and potential dividends but tends to be more expensive. Term life insurance, on the other hand, provides temporary coverage, flexible term lengths, affordable premiums, and a simple structure but lacks the cash value component and long-term guarantees of whole life insurance. The choice between the two depends on an individual's financial goals, budget, and specific coverage needs.

Frequently asked questions