Over the past few weeks I have been asked (and pitched) the idea of whether cash-value life insurance makes sense as a vehicle for saving and paying for college. By cash-value life insurance, I am including whole life, variable life, universal life and variable universal life policies.
First, in almost all cases, it does not. The very few cases where it may make sense will be covered shortly.
Here are some reasons why a 529 college savings plan is better than cash-value life insurance.
- 529 plans have very high contribution amounts. Depending on your state, the total amount you can