Asked by Harish Ravalla on May 31, 2024
Verified
_______ is a life insurance policy that provides a death benefit and a fixed-rate tax-deferred savings plan.
A) Term life
B) Whole life
C) Variable life
D) Universal life
Whole Life
A type of life insurance policy that offers lifetime coverage, with consistent premiums and a savings component.
Fixed-Rate Tax-Deferred
Describes investment accounts or financial products that accumulate earnings taxed at a later date instead of when they are earned, with a fixed interest rate.
Savings Plan
A program that allows individuals to allocate a portion of their income for long-term savings or investments.
- Identify how risk tolerance affects investment choices at various life phases.
Verified Answer
MA
Mahmoud AljohaniMay 31, 2024
Final Answer :
B
Explanation :
Whole life insurance policies provide both a death benefit and a fixed-rate tax-deferred savings plan. This means that a portion of the premiums paid is invested and grows over time, providing a source of cash value that can be used for things like retirement income or loans. While whole life policies tend to be more expensive than term life or universal life policies, they offer the added benefit of lifetime coverage and the potential for long-term investment growth.
Learning Objectives
- Identify how risk tolerance affects investment choices at various life phases.