Q: What is the difference between term and permanent insurance?
A: Let’s take term insurance first. Term life insurance provides death-benefit coverage for a specified block of time. Term insurance is renewed annually, typically, which allows you to terminate the plan simply by not renewing.

Term is initially the least-expensive type of insurance to buy, but premiums can increase as you age. For growing families on a tight budget concerned primarily with protecting themselves from a loss of income, the lower cost of term insurance often makes the most sense.

Permanent life insurance, on the other hand, allows you to build a guaranteed cash value in addition to death-benefit coverage. Although permanent life insurance is typically more expensive, annual premiums do not increase. In addition, you have the flexibility to borrow money against your permanent contract— consult a professional before doing so.

For individuals and families interested in not only buying death-benefit coverage, but also providing a tax-advantaged benefit to their children and/or building cash value to supplement a retirement income, permanent life insurance often makes the most sense.

Q: How do I know whether I have enough insurance?
A: This is a common question. Unfortunately, there is no hard-and-fast answer. The best way is to contact your Thrivent Financial representative for a free needs analysis so that he/she can evaluate your individual needs.

During the needs analysis, you’ll discuss how many years you want to be covered and what kinds of assets you have. Factors including your current earnings, the rate return on your investments go into determining the level of coverage you need.

In the meantime, try our insurance planning calculator.

Q: What is a variable annuity, and at what age should I look into one?
A: A variable annuity is a personal retirement account that combines features of both mutual funds and insurance. With a variable annuity, you can accumulate assets by investing tax-deferred in various portfolios that function similarly to mutual funds. Your investment value will fluctuate over time, reflecting the performance of the underlying asset classes you choose. The insurance feature of variable annuities typically comes in the form of a guaranteed death benefit.

You can start a variable annuity with a lump-sum purchase or through periodic contributions.Because a variable annuity can function as both an accumulation and an income-generation vehicle, it can be an appropriate option for a wide range of investors.

Variable insurance products, where available, are offered and underwritten by Thrivent Financial for Lutherans, Appleton, WI 54919-0001, and distributed by Thrivent Investment Management Inc., 625 Fourth Ave. S., Minneapolis, MN 55415-1665, 800- THRIVENT (800-847-4836), a wholly owned subsidiary of Thrivent Financial for Lutherans. Member FINRA. Member SIPC.