Term life insurance is the best type of life insurance to purchase. The rates are generally lower, which will allows to purchase more life insurance for less money and frees up room in your budget for other things.
You purchase term life insurance for a set number of years ranging from ten up to thirty or forty years. The rate should stay the same the entire length of the term, but once the term is over you will no longer have life insurance. This is why the rate is lower. Additionally you do not receive money at the end of term policy. The only way that the policy will pay out is if the person the policy is for passes away.
Many people mistakenly think that whole life insurance is a better option, because you can get money out of the policy later on, by cashing it in. The rates are much higher and the return on your money is much lower than if you were to invest the difference in cost in a good mutual fund. It is a better option to go with a term life policy.
You should purchase enough life insurance to pay off your current debts and still have enough left over for your spouse and children to live on over the years. Generally you can do this by purchasing about eight times your annual salary. If you have a lot of debt you may want to go higher.
