What’s the Deal with Cash Value in Life Insurance?

Hey everyone,

I’ve recently been looking into permanent life insurance and came across the concept of cash value. At first, it sounded a bit confusing, so I figured I’d share what I’ve learned and see if anyone else has insights or personal experience.

So, here’s the basic idea:
With certain types of life insurance, like whole life, universal life, or variable life, a portion of your premium goes toward building a cash value. This acts like a savings or investment component within the policy that grows tax-deferred over time.

What can you do with it?

• Borrow against it

• Use it to pay premiums

• Withdraw from it (with some tax considerations)

• Let it grow and pass it on

It seems like a great feature, but there are some downsides too, like slower growth in the early years and potential tax implications if not managed properly.

I’d love to know:

• Have any of you tapped into the cash value from your life insurance?

• Was it worth it?

• Any lessons or tips to share?

Looking forward to hearing your thoughts and learning from your experiences!