Life insurance can be complex and overwhelming, especially with the countless insurance policies out there. It\u2019s important to know the differences between them since each type has unique characteristics that may or may not be right for you. But more often than not, shopping for policies can get confusing. When it comes to life insurance policies, they can commonly be broken down into term vs permanent life insurance. \r\n\r\nIn honor of September being National Life Insurance Awareness Month, let's dive into some of the main things to be aware of when deciding between term and permanent life insurance.\r\n\r\nTerm Life Insurance\r\nAs the name might suggest, term life insurance provides coverage for a specified amount of time \u2013 usually from 10 to 30 years, with 20 being the most common. Once the term period ends, your coverage ends. If you pass away before the term period ends, then your beneficiaries get the face value of your policy. It's important you consider the length of the term carefully, and be sure it covers your dependents until they no longer need support. It can be very expensive \u2014 or impossible to renew term insurance later if your health situation changes.\r\n\r\nTerm insurance generally costs less than other - more permanent insurance \u2013 and carries a predetermined premium. You will want to compare rates and coverage to ensure you\u2019re getting the best policy for your needs.\r\n\r\nPermanent Life Insurance\r\nPermanent life insurance provides lifelong protection for the insured. This type of policy usually comprises an insurance product coupled with a savings or investment component. Your insurance company invests part of your premium and your cash value is then built up by the accrued interest. The growth is generally tax deferred and can be accessed over the life of the policy, with some constraints.\r\n\r\nThese types of policies tend to have larger upfront costs with higher premiums due to the extended coverage period and investment component. Investment choices offered through the policy tend to be high cost and inefficient, which may offset the potential tax benefit. Permanent life insurance is generally not necessary for most people\u2019s financial planning needs; however if you\u2019re interested in estate tax mitigation, financial legacy enhancement, or have pre-existing health issues, permanent life insurance may make sense for you.\r\n\r\nPersonal Capital Strategy\r\nWe generally recommend that if you are in normal health, term life insurance is preferable to permanent life insurance. Your circumstances, however, are unique to your own life, and you should speak with your advisor to determine what kind of life insurance is right for you.\r\n\r\nWhen you use our free tools to input your financial information, we can recommend a level of insurance coverage to help keep you and your family protected and on track for your long-term goals.\r\n\r\nRead More: How Much Life Insurance Do You Need?\r\n\r\nAll insurance analysis and insight provided is extended to you as a courtesy for educational purposes only. You should not rely on this information as the primary basis of your insurance planning decisions. We are not licensed insurance professionals. You should consult a qualified licensed insurance professional regarding your specific situation.