What type of life insurance should I get?

Hi Korbin,

I suggest an Indexed Universal permanent life insurance policy.

Here is a fragment of an article that can give you the reason why:
Guarantees

FIUL policies have built-in safety features -- guaranteed up front in writing -- that protect the accumulating cash value of the policy by automatically eliminating exposure to any losses during downturns in the economy and financial markets. The following guarantees are backed by major financial institutions with long-standing, top-rated, verifiable track records of responsibility and dependability:
- Safety of Principal
- Locked-In Gains

Growth With Safety

The cash value of a FIUL policy grows using a combination of the "indexing method" and competitive fixed rates of return that are declared annually. When using the index method, growth of the account value is tied for crediting purposes only to a major stock market index like the S&P 500. The cash value of the account is never directly invested in or exposed to the market.
Financial markets and the economies they reflect will move in cycles -- both positive and negative. The power of the indexing method is that it works in your favor when the cycles are positive, while, again, automatically eliminating the possibility of the cycles working against you when they take their turn on the negative side, particularly at the wrong time in life -- a major lesson learned from the Financial Crisis.
Compound gain over time works to great advantage -- provided it is not interrupted by compound loss. This means having reliable safeguards in place at all times that will automatically eliminate the disruptive and debilitating effects of compound loss.
Yes, your rate of return when the cycles are positive will be less because of the safety features you have opted for. However, based on The Core Operating Principle of Financial Conservation, by eliminating the negative growth impact of compound loss from the financial equation, your child will be ahead and have financial stability in the long run.

Major Tax Advantages

Given the record levels of current government spending and mounting deficits, minimizing taxpayer costs within the letter of the law are increasingly important planning priorities. At some point, the government spending bill will arrive. We can count on that. And the estimated time of arrival as "the can gets kicked down the road" is particularly not looking good for our new and future generations.
FIUL provides the following:
- Tax-Deferred Growth of Cash Value
- Tax-Free Income (see explanation below)
- Tax-Free Death Benefit
Sections 7702, 72e and 101a of the Internal Revenue Code allow the cash value inside life insurance contracts to: 1) accumulate tax-free, 2) be accessed (including the gains) in the form of withdrawals and policy loans for retirement or other income purposes tax-free, and 3) be transferred income tax-free at death, when properly structured under tax citations TEFRA/DEFRA and TAMRA.

Liquidity

The cash value accumulating in a FIUL policy over the course of your child's lifetime has liquidity that would be there for unanticipated life events that would cause a short-term need for immediately available cash to protect and maintain fixed assets such as the equity in a home.

Greater Flexibility

Unlike 401ks, IRAs, Roths and other savings plans, FIUL policies are not subject to:
- Dollar Amount Restrictions on Funding of the Policy
- IRS Penalty Fees for Early Withdrawals Prior to Age 59 1/2
- Required Minimum Distributions

Choice & Expertise Matters
All professions have their areas of specialization. Please note that in order to maximize the Living Benefits of this type of plan, it should be properly structured by an insurance professional who has the right training and expertise. This is a plan for life and one size does not fit all.

This is the era of Financial Conservation!

You are headed in the right direction. It's a good decision to choose a term life insurance policy at your age. It’s true that rates vary per your age and health and the younger you are, the lower will be your annual premium. The main reason people choose term life insurance is to provide financial support to their families in case of death, pay off any debts or mortgages, and buy a sense of security and peace of mind. A professional, unbiased online insurance provider may be your best option. You can check out AccuQuote.com for more information.

Denise at AccuQuote
Disclaimer: I work for AccuQuote and this is my personal opinion.