Category: Uncategorized

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The Age You Claim Social Security Changes Everything

You can start Social Security as early as age 62 or as late as age 70. Waiting longer means a bigger monthly check. But that is not always the right call. This guide helps you find the best time to claim based on your situation.

Rates and figures as of May 2026.

The Three Main Ages to Know

Age 62: The Earliest Option

You can claim at 62, but your benefit is permanently reduced. The reduction is about 25-30% less than your full benefit, depending on your birth year. If you need the income now or have health concerns, early claiming might make sense.

Full Retirement Age (FRA)

Your full retirement age is the point where you get 100% of your earned benefit. For anyone born in 1960 or later, FRA is 67. Claiming before 67 means a reduced benefit. Claiming after 67 means an increased benefit.

Age 70: The Maximum Benefit

For every year you wait past your FRA, your benefit grows by 8% per year. Wait until 70 and you can get up to 32% more than your FRA amount. After 70, there is no additional increase, so there is no reason to wait longer.

The Break-Even Analysis

The break-even point is when the total lifetime payments from waiting equal the total from claiming early. For most people, the break-even age is around 80 to 83.

Here is the simple math: if you expect to live past 80-83, waiting to claim usually puts more money in your pocket over your lifetime. If you have serious health issues or a shorter life expectancy, claiming early or at FRA may make more sense.

Spousal Benefits

Married couples have more flexibility. A spouse can claim benefits based on their own work record or up to 50% of their partner’s benefit, whichever is higher.

A common strategy: one spouse claims early for income, while the higher earner waits until 70 to maximize the survivor benefit. When one spouse dies, the surviving spouse gets the higher of the two monthly amounts.

Working While Claiming

If you claim before your FRA and keep working, your benefit is temporarily reduced if you earn above the annual limit ($22,320 in 2026). For every $2 you earn above the limit, $1 is withheld from your Social Security check. Once you reach FRA, the withheld amounts are added back, and there is no earning limit after that point.

What to Think About Before You Decide

• Your health and expected lifespan
• Whether you are still working and what you earn
• Your spouse’s situation and benefit amount
• Whether you have other retirement income
• Your overall financial picture

Social Security is just one piece of retirement income. A Roth IRA vs Traditional IRA comparison can help you decide how to save in parallel. Also check how your savings stack up against the retirement benchmarks by age. If you have not started investing yet, the best investment apps for beginners are a good starting point.

Frequently Asked Questions

What is the best age to claim Social Security?

It depends on your health, finances, and life expectancy. If you expect to live past 80-83, waiting until 70 usually gives you more total lifetime income.

How much is my benefit reduced if I claim at 62?

For people with a full retirement age of 67, claiming at 62 reduces your benefit by about 30%. This reduction is permanent.

Can I work while receiving Social Security?

Yes, but if you claim before full retirement age and earn above $22,320 (2026 limit), $1 is withheld for every $2 you earn over the limit. After full retirement age, there is no earning limit.

What happens to Social Security if my spouse dies?

You can receive the higher of your own benefit or your deceased spouse’s benefit. This is why the higher earner in a couple often benefits from waiting until 70 to claim.

This article contains affiliate links. We may earn a commission if you apply through our links, at no extra cost to you.

You Do Not Have to Pay to File Your Taxes

Millions of Americans pay to file their taxes every year. But you do not have to. There are several free options that work for most people. This guide covers the best ways to file for free in 2026.

Rates and figures as of May 2026.

IRS Free File

IRS Free File is the most well-known free option. It is a partnership between the IRS and several tax software companies.

If your income is $84,000 or below, you can use guided tax software at no cost. The IRS website lists the companies that participate each year. You pick one and file through their site.

If your income is above $84,000, you can still use Free File Fillable Forms. These are electronic versions of the paper forms. There is no guidance, but there is no cost either.

Go to IRS.gov/freefile to start. Do not search Google for “IRS Free File.” Scam sites use that phrase to trick people.

FreeTaxUSA

FreeTaxUSA is one of the best free tax options. Federal filing is always free. State filing costs $14.99, which is still much less than TurboTax or H&R Block.

It handles W-2 income, self-employment income, investment gains, and retirement income. The interface is simple. Most people can finish in under an hour.

Cash App Taxes

Cash App Taxes (formerly Credit Karma Tax) is completely free. Federal and state filing cost nothing. There are no hidden fees or upgrade prompts.

The downside is that it does not cover every tax situation. If you have a complex return, FreeTaxUSA or IRS Free File may be a better fit.

VITA: Free Help for Lower-Income Filers

VITA stands for Volunteer Income Tax Assistance. It is an IRS program that provides free tax prep for people who earn $67,000 or less. Trained volunteers prepare your return at no charge.

VITA sites are usually at libraries, schools, and community centers. Use the IRS VITA locator tool to find one near you.

What to Watch Out For

• Do not confuse “free to start” with “free to file.” Many paid services advertise free filing but charge when you get to the state return or certain forms.
• TurboTax and H&R Block have free tiers, but they are limited. If you have any investment income, freelance income, or own a home, you will likely hit a paywall.
• Check that your chosen service supports all the forms you need before you start entering data.

Which Free Option Should You Use?

Here is a simple way to decide:

• Income under $84,000 with a straightforward return: Use IRS Free File guided software.
• Want a clean interface with free federal filing: Use FreeTaxUSA.
• Want completely free federal and state: Use Cash App Taxes.
• Need in-person help: Find a VITA site.

Once your taxes are done, think about where to put any refund you get. A high-yield savings account can earn you much more than a regular bank account. You should also make sure you have an emergency fund in place before investing or paying down debt. If you owe the IRS money, check out our guide on how to pay off IRS tax debt.

Frequently Asked Questions

Can I file my taxes for free if I have a side income?

Yes. FreeTaxUSA handles self-employment income for free at the federal level. You will need to report it on Schedule C. State filing costs $14.99 on FreeTaxUSA.

Is IRS Free File really free?

Yes, if you qualify. Households earning $84,000 or less can use guided software at no cost. Above that income, the Free File Fillable Forms are still free but have no guidance.

What is the deadline to file taxes in 2026?

The standard federal tax deadline is April 15. If that falls on a weekend or holiday, it shifts to the next business day. You can file for a free extension to October 15, but any taxes owed are still due by April 15.

What happens if I file late?

If you owe taxes and file late, the IRS charges a failure-to-file penalty of 5% of unpaid taxes per month, up to 25%. If you are owed a refund, there is no penalty for filing late, but you have three years to claim your refund before it is forfeited.

Can I file for free if I own a home?

It depends on the service. FreeTaxUSA supports Schedule A for free. TurboTax and H&R Block often charge for this. IRS Free File guided software also covers homeowner deductions.

Disclosure: This article contains affiliate links. We may earn a commission if you apply through our links, at no extra cost to you.

The 50/30/20 rule is one of the most popular budgeting methods. It’s simple, flexible, and works for most people.

But does it still work in 2026? Here’s how to use it — and when to adjust it.

What Is the 50/30/20 Budget Rule?

Split your after-tax income into three buckets:

• 50% — Needs: Rent, groceries, utilities, insurance, minimum debt payments
• 30% — Wants: Dining out, subscriptions, entertainment, vacations
• 20% — Savings and debt payoff: Emergency fund, retirement, extra debt payments

Example Calculation

After-tax income: $5,000/month

• Needs (50%): $2,500
• Wants (30%): $1,500
• Savings/debt (20%): $1,000

Simple. But real life is rarely that clean.

The Problem with 50% for Needs in High Cost-of-Living Areas

In cities like San Francisco, New York, or Boston, rent alone can eat 40% to 50% of after-tax income. If you live somewhere expensive, the standard 50% bucket won’t hold all your needs.

Adjustments for high cost-of-living areas:

• Try a 60/20/20 split (more to needs, cut wants, keep savings the same)
• Or 60/10/30 (increase savings rate to compensate for longer time to reach goals)
• Focus on lowering fixed costs over time — smaller unit, roommates, moving to a cheaper area

50/30/20 vs Zero-Based Budgeting

Method	How It Works	Best For
50/30/20	Percentage-based categories	Simple budgets, beginners
Zero-based (YNAB)	Every dollar gets a job	Detail-oriented, debt payoff, irregular income
Envelope method	Cash in physical or digital envelopes	Overspenders, cash users
Pay yourself first	Auto-save first, spend the rest	People who struggle to save consistently

How to Use the 50/30/20 Rule Step by Step

1. Calculate after-tax income. Use your take-home pay, not your gross salary.
2. List all needs. Rent, utilities, groceries, insurance, minimum payments on debt.
3. Check if needs exceed 50%. If so, you need to cut needs or adjust the split.
4. Assign 30% to wants. Be honest — subscriptions and gym memberships are wants, not needs.
5. Route the remaining 20% to savings and debt. Start with your emergency fund, then retirement, then extra debt payments. See our guide: how much should you save in an emergency fund.

Where to Put Your 20%

Prioritize in this order:

1. Emergency fund — 3 to 6 months of expenses in a high-yield savings account
2. 401(k) match — get the full employer match first (free money)
3. Roth IRA or traditional IRA
4. Extra debt payments using the avalanche or snowball method

Does the 50/30/20 Rule Still Work in 2026?

Yes — as a starting framework. Inflation has pushed up costs for food, housing, and insurance. This means many people need to adjust the 50% needs bucket upward.

The rule is a guideline, not a rigid law. What matters most is that 20% gets saved or used to pay down debt. The split between needs and wants can flex.

Frequently Asked Questions

Should I use gross or net income for the 50/30/20 rule?

Use net income — your after-tax take-home pay. Using gross income overstates what you actually have to work with.

What counts as a “need” vs a “want”?

Needs are things you cannot live without: housing, food, utilities, transportation to work, insurance, minimum debt payments. Wants are everything else, including eating out, streaming services, and hobbies.

What if I can’t save 20%?

Start with whatever you can — even 5% or 10%. Increase by 1% every few months. The goal is to build the habit and grow over time.

Is 50/30/20 good for paying off debt?

The 20% bucket covers minimum payments (counted in needs) plus extra debt payments. If you want to pay off debt faster, shrink the wants bucket and put more into debt.

Can I use the 50/30/20 rule with a variable income?

Yes. Use your lowest expected monthly income as the base. In higher-income months, put extra toward savings and debt.

Disclosure: This article contains affiliate links. We may earn a commission if you apply through our links, at no extra cost to you.

An emergency fund is money set aside for unexpected expenses. It’s your financial safety net.

Without one, a job loss, car repair, or medical bill can wreck your budget. With one, you handle it and move on.

How Much Should You Have in an Emergency Fund?

The standard rule: save 3 to 6 months of living expenses.

• 3 months: Good starting point. Covers most short-term job losses and emergencies.
• 6 months: Better. Recommended for single-income households, freelancers, or anyone in a volatile industry.
• 9 to 12 months: Best for business owners, highly specialized workers, or those with dependents.

How to Calculate Your Emergency Fund Number

Add up your monthly essential expenses:

• Rent or mortgage payment
• Utilities (electric, gas, water, internet)
• Groceries
• Insurance (health, car, renters/homeowners)
• Minimum debt payments
• Transportation (gas, car payment, or transit)

Multiply by 3, 6, or more depending on your situation.

Example: $3,500/month in essential expenses x 6 = $21,000 emergency fund

For a more detailed breakdown, use the emergency fund calculator.

Where to Keep Your Emergency Fund

Your emergency fund should be:

• Liquid — accessible within 1 to 2 business days
• Safe — not subject to market volatility
• Earning interest — don’t let it sit in a 0.01% checking account

Best Places to Keep Your Emergency Fund

Option	Typical Rate (May 2026)	Access
High-Yield Savings Account (HYSA)	4.00% – 4.70% APY	1–2 business days
Money Market Account	3.80% – 4.50% APY	Same-day to 2 days
Regular Savings Account	0.01% – 0.50% APY	Same-day
CD (6-month)	4.50% – 4.80% APY	At maturity only
Checking Account	0.01% – 0.10% APY	Instant

Rates as of May 2026.

Best choice: A high-yield savings account. It earns 4%+ and is accessible within 1 to 2 business days. See the best options: Best High-Yield Savings Accounts 2026.

Avoid stocks or index funds for your emergency fund. The value can drop when you need the money most.

Should You Use a CD for Part of Your Emergency Fund?

Some people split their emergency fund. They keep 1 to 2 months in a savings account and put the rest in a short-term CD for a higher rate. This is called a “CD ladder.”

The risk: CDs are not accessible until they mature. If your emergency is bigger than the liquid portion, you may face an early withdrawal penalty. Compare your options: CD vs High-Yield Savings Account.

How to Build Your Emergency Fund Fast

1. Open a dedicated account. Keep it separate from your regular checking. Out of sight helps.
2. Start small. Aim for $1,000 first. That covers most single emergencies.
3. Automate. Set up automatic transfers on payday. Even $50 per week builds fast.
4. Put windfalls in. Tax refunds, bonuses, or gift money should go straight to the fund until it’s full.
5. Cut one want temporarily. Pause one subscription or eating-out habit until you hit your goal.

When to Use Your Emergency Fund

Your emergency fund is for real emergencies. Not vacations. Not Black Friday sales. Legitimate uses include:

• Job loss or income interruption
• Medical bills not covered by insurance
• Emergency home repairs (broken furnace, roof leak)
• Car repairs needed to get to work

After You Use It, Rebuild It

If you tap your emergency fund, make rebuilding it your next financial priority. Treat it like paying off debt — urgent and systematic.

Once your emergency fund is fully built, redirect that monthly savings to retirement. See how much you should have saved by age: Retirement Savings Benchmarks by Age.

Frequently Asked Questions

Is 3 months enough for an emergency fund?

For dual-income households with stable jobs, yes. For single-income households, freelancers, or those with health issues, 6 months is safer.

Should my emergency fund be in a savings account or invested?

Keep it in a savings account or money market account. Never invest emergency funds in stocks — the value can drop when you need it most.

Does having debt change my emergency fund target?

Not really. Even if you are paying off debt, keep at least a $1,000 starter emergency fund. Otherwise, any surprise expense goes back on a credit card and erases your progress.

Can I use my emergency fund as a down payment?

No. Emergency funds should not be earmarked for goals. Save separately for a down payment. If you use the emergency fund for a purchase, you’re unprotected.

What’s the best high-yield savings account for an emergency fund?

Look for accounts with 4%+ APY, no minimum balance, and no fees. Our top picks: Best High-Yield Savings Accounts 2026.

Disclosure: This article contains affiliate links. We may earn a commission if you apply through our links, at no extra cost to you.

A HELOC lets you tap your home equity when you need it. But not all lenders are the same. Rates, fees, and draw terms vary a lot.

Here are the best HELOC lenders for 2026, based on APR ranges, draw periods, and credit score requirements.

Best HELOC Lenders 2026: Quick Comparison

Lender	APR Range	Draw Period	Min. Credit Score
Figure	8.45% – 14.99%	2, 3, 5 yrs	640
Bethpage FCU	7.99% – 10.49%	10 years	670
Bank of America	8.60% – 10.20%	10 years	660
PNC Bank	8.50% – 11.50%	10 years	660
U.S. Bank	8.70% – 12.25%	10 years	660
Third Federal	8.24% – 9.99%	10 years	680

Rates as of May 2026. APRs are representative and may vary by location, credit profile, and LTV.

Best for Fast Funding: Figure

Figure is an online lender. It uses automated appraisals to close in as few as 5 business days. Rates start around 8.45%. The draw periods are shorter than traditional HELOCs (2, 3, or 5 years). You get the full line upfront, like a loan. Best for people who need cash quickly.

Best Credit Union Rate: Bethpage FCU

Bethpage Federal Credit Union often has some of the lowest HELOC rates available. You must become a member, but anyone can join with a small deposit. It offers a traditional 10-year draw period and no closing costs on most products.

Best Big Bank Option: Bank of America

Bank of America is a solid choice for existing customers. Preferred Rewards members get rate discounts. The bank offers HELOCs in most states and has a straightforward online application. No annual fee and no closing costs on most products.

Best for Low Intro Rate: Third Federal

Third Federal has consistently low rates among traditional lenders. It serves a limited number of states. If you qualify, it’s worth checking. It also has no closing costs and no annual fee.

What to Look for in a HELOC Lender

• APR: Compare the full annual percentage rate, not just the intro rate
• Draw period: Standard is 10 years. Some online lenders offer shorter terms
• Fees: Watch for annual fees, prepayment penalties, and inactivity fees
• Closing costs: Many lenders waive these — always ask
• Rate caps: Variable HELOCs should have a lifetime rate cap

How to Qualify for the Best HELOC Rate

Lenders look at three things:

1. Credit score: 720+ gets the best rates
2. Loan-to-value (LTV): Having 25%+ equity helps
3. Debt-to-income ratio: Under 43% is the standard cutoff

Check your debt-to-income ratio before applying. Before you borrow, make sure you understand your total home-related costs using our mortgage payment calculator.

HELOC vs Other Home Equity Options

Not sure a HELOC is right? Compare your options:

• Home equity loan: Fixed rate, lump sum — better for one-time costs
• Cash-out refinance: Replaces your mortgage with a larger one — best when rates are low
• Personal loan: No home collateral needed — but higher rates

See our full breakdown: HELOC vs Home Equity Loan: Which Is Better in 2026?

Frequently Asked Questions

What credit score do I need for a HELOC?

Most lenders require at least 620. To get the best rates, aim for 720 or higher.

How much can I borrow with a HELOC?

Most lenders allow up to 80%–85% combined loan-to-value. That means your mortgage plus the HELOC cannot exceed 80%–85% of your home’s value.

Are HELOC rates fixed or variable?

Most HELOCs have variable rates tied to the prime rate. Some lenders (like Figure) offer fixed-rate HELOCs. Check before you apply.

Can I get a HELOC if I already have a second mortgage?

It depends on your equity. If you have enough equity and your combined LTV is within limits, some lenders will still approve you.

Is a HELOC a good idea right now?

It depends on your needs and how you plan to use the funds. For home improvements or ongoing expenses, a HELOC offers flexibility. Just be aware that rates are variable and could rise.

Disclosure: This article contains affiliate links. We may earn a commission if you apply through our links, at no extra cost to you.

A cash-out refinance lets you replace your current mortgage with a larger one. The difference goes to you as cash.

It can be a smart move. But it’s not right for everyone. Here’s how it works and when it makes sense in 2026.

How a Cash-Out Refinance Works

Say your home is worth $400,000. You owe $200,000 on your mortgage. You have $200,000 in equity.

With a cash-out refi, you take out a new mortgage for $280,000. You pay off the old $200,000 balance. The remaining $80,000 goes to you in cash.

You now have one mortgage at $280,000. Your monthly payment is based on the new loan amount and new rate.

Current Cash-Out Refinance Rates

Cash-out refinance rates are typically 0.25% to 0.75% higher than standard refinance rates.

Loan Type	Avg. Rate (May 2026)
30-year fixed (cash-out)	7.10% – 7.75%
15-year fixed (cash-out)	6.60% – 7.20%
FHA cash-out (30-year)	6.80% – 7.40%
VA cash-out (30-year)	6.50% – 7.10%

Rates as of May 2026. Your actual rate depends on credit score, LTV, and lender.

Cash-Out Refi vs HELOC: Which Costs Less?

A HELOC adds a second loan on top of your mortgage. A cash-out refi replaces your mortgage entirely.

• If your current mortgage rate is below 6%, a cash-out refi will cost you more in the long run. You’d be replacing a low-rate loan with a higher-rate one.
• If your rate is already above 7%, a cash-out refi can make sense — especially if you can lower your rate at the same time.

Compare this with your options. See our guide on HELOC vs Home Equity Loan for a full side-by-side.

Break-Even Analysis

A cash-out refi has closing costs — usually 2% to 5% of the loan. That means on a $280,000 loan, you might pay $5,600 to $14,000 upfront.

To find your break-even point: divide the closing costs by your monthly savings. If closing costs are $8,000 and you save $200/month, it takes 40 months to break even.

Only refinance if you plan to stay in the home long enough to pass that break-even point. Use our mortgage payment calculator to estimate your new monthly cost.

Pros and Cons of Cash-Out Refinancing

Pros

• One loan, one payment (simpler than a HELOC)
• Fixed rate — no surprises
• Can lower your rate if current rates are lower
• Access to large lump sums

Cons

• Closing costs are high
• Resets your loan term (you may pay more interest overall)
• If rates are higher now, your payment goes up
• You put your home at risk

Top Lenders for Cash-Out Refinance

• Rocket Mortgage: Fast online process, wide availability
• Better.com: No origination fee, competitive rates
• loanDepot: Good for borrowers with less equity
• Navy Federal: Best VA cash-out option for military members
• Chase Bank: Strong for existing customers

Qualification Requirements

• Credit score: 620 minimum (740+ for best rates)
• Equity: at least 20% remaining after the cash-out (80% max LTV)
• DTI: under 43% — check yours with the debt-to-income ratio calculator
• Home appraisal required

Also see: How to Get Pre-Approved for a Mortgage in 2026

When a Cash-Out Refi Makes Sense

• You can lower your rate AND get cash
• You need a large lump sum for home renovations
• You want to consolidate high-interest debt
• You have a lot of equity and plan to stay in the home

When to Skip It

• Your current rate is much lower than today’s rates
• You plan to sell in less than 3 years
• You need only a small amount — a HELOC or personal loan is cheaper

Frequently Asked Questions

How much cash can I get from a cash-out refinance?

Most lenders allow up to 80% LTV. On a $400,000 home, that means up to $320,000 total — minus your current mortgage balance.

Does a cash-out refi hurt your credit score?

It causes a small temporary dip from the hard inquiry and new account. This usually recovers within 6 to 12 months.

How long does a cash-out refi take?

Typically 30 to 45 days. Online lenders can sometimes close faster.

Can I do a cash-out refi if I have an FHA loan?

Yes. FHA allows cash-out up to 80% LTV. You’ll also need a new appraisal and to meet FHA credit requirements.

Is cash from a cash-out refinance taxable?

No. Cash from a refinance is loan proceeds, not income. It is not taxable. However, the interest may or may not be deductible depending on how you use the funds.

Disclosure: This article contains affiliate links. We may earn a commission if you apply through our links, at no extra cost to you.

Home equity loan rates in 2026 are higher than they were a few years ago. But they are still below credit card rates. For many homeowners, a home equity loan is a cost-effective way to borrow.

Here’s what you can expect to pay — and how to get the best rate.

Current Home Equity Loan Rates

Term	Average Rate (May 2026)	Range
5-year fixed	8.50%	7.80% – 9.50%
10-year fixed	8.65%	8.00% – 9.75%
15-year fixed	8.90%	8.25% – 10.00%
20-year fixed	9.10%	8.50% – 10.25%

Rates as of May 2026. Your actual rate depends on credit score, LTV, loan amount, and lender.

What Factors Affect Your Rate?

Five things drive your home equity loan rate:

1. Credit score: The biggest factor. 760+ gets the best rates. Below 660 and you’ll pay significantly more.
2. Loan-to-value (LTV): Borrowing less than 80% of your home’s value puts you in a stronger position.
3. Loan amount: Smaller loans sometimes carry higher rates. Borrowing $50,000+ usually gets better pricing.
4. Loan term: Shorter terms usually have lower rates.
5. Lender: Rates vary widely. Always compare at least 3 lenders.

Best Home Equity Loan Lenders 2026

Lender	Starting APR	Max LTV	Loan Range
Discover	7.99%	90%	$35K – $300K
TD Bank	8.25%	89.9%	$10K – $500K
Spring EQ	8.49%	95%	$25K – $500K
U.S. Bank	8.55%	80%	$15K – $750K
Regions Bank	8.60%	80%	$10K – $250K

Home Equity Loan vs HELOC vs Cash-Out Refi

• Home equity loan: Fixed rate, lump sum, predictable payments. Best for one-time large expenses.
• HELOC: Variable rate, draw as needed. Best for ongoing needs or a financial safety net.
• Cash-out refi: Replaces your mortgage. Best when today’s rates are lower than your current rate.

See the full comparison: HELOC vs Home Equity Loan: Which Is Better in 2026?

How to Get the Best Rate

1. Check your credit score first. Dispute any errors before applying.
2. Pay down other debts to lower your DTI. Use the DTI calculator to see where you stand.
3. Get quotes from at least 3 lenders. Credit unions often beat big banks.
4. Ask about rate lock options and any fee waivers.
5. Compare the APR, not just the interest rate — the APR includes fees.

How Much Will Your Payments Be?

At 8.65% for 10 years, here are estimated monthly payments:

• $25,000 loan: ~$312/month
• $50,000 loan: ~$624/month
• $100,000 loan: ~$1,248/month

Use the mortgage payment calculator to run your own numbers.

Frequently Asked Questions

Are home equity loan rates fixed?

Yes. Home equity loans have fixed rates. Your payment will not change over the life of the loan.

How is a home equity loan different from a second mortgage?

A home equity loan IS a second mortgage. The terms are often used interchangeably. It is a loan secured by your home equity, behind your primary mortgage.

Can I deduct home equity loan interest?

Only if you use the funds to buy, build, or improve your home. Personal expenses do not qualify. Consult a tax professional.

What is a good home equity loan rate?

In May 2026, a good rate is anything under 8.50% for a 10-year term. Rates below 8% are excellent. Your credit score and LTV are the main drivers.

How long does it take to get a home equity loan?

Typically 2 to 4 weeks. It involves an application, appraisal, title search, and underwriting.

Disclosure: This article contains affiliate links. We may earn a commission if you apply through our links, at no extra cost to you.

Term life insurance is simple. You pay a monthly or annual premium. If you die during the term, your family gets a payout. If you outlive the term, it ends.

It’s the most affordable way to protect your family. Here are the best term life insurance companies in 2026.

Best Term Life Insurance Companies 2026: Quick Picks

Company	Best For	Coverage	No Exam?
Haven Life	Online speed, low rates	$100K – $3M	Up to $1M
Ladder	Flexible, adjustable coverage	$100K – $8M	Up to $3M
Bestow	Fully digital, no exam	$50K – $1.5M	Always
Guardian Life	Solid financial strength	Varies by age	Some policies
Pacific Life	High coverage amounts	Up to $10M+	Some policies
Banner Life	Long terms, low rates	$100K – $10M+	Some policies

Haven Life: Best for Online Shoppers

Haven Life is backed by MassMutual, one of the oldest life insurers in the US. You can apply fully online. Many applicants get instant approval with no medical exam for coverage up to $1 million. Rates are competitive for healthy applicants under 45.

Ladder: Best for Flexibility

Ladder lets you increase or decrease coverage as your life changes. Have a baby? Increase your coverage. Pay off your mortgage? Lower it. You pay only for the coverage you need. No exam required up to $3 million for some applicants.

Bestow: Best No-Exam Option

Bestow is 100% digital. No medical exam — ever. You answer a short health questionnaire and get a decision in minutes. Coverage goes up to $1.5 million. Terms run from 10 to 30 years. Best for people who want fast coverage without a doctor visit.

Guardian Life: Best Financial Strength

Guardian has an AM Best A++ rating — the highest possible. It has been paying claims since 1860. Best for people who want the most financially secure insurer behind their policy.

Pacific Life: Best for High Coverage

Pacific Life is ideal for high-income earners who need large death benefits. It offers coverage well above $5 million and has strong ratings. You’ll need a medical exam for larger policies.

Banner Life: Best Long-Term Rates

Banner Life (Legal & General America) consistently has some of the lowest rates for 20- and 30-year terms. Great choice if you are locking in coverage for a long period.

How to Choose the Right Company

1. Decide on the coverage amount. See our guide: How Much Life Insurance Do You Need?
2. Choose a term length. Match it to your longest financial obligation (mortgage, years until kids leave home).
3. Decide if you want no-exam coverage. It’s faster but can cost slightly more.
4. Compare quotes from at least 3 companies. Rates vary significantly.
5. Check financial strength ratings: AM Best A or better is the standard.

Sample Monthly Premiums

Healthy 35-year-old male, 20-year term, $500,000 coverage:

• Haven Life: ~$28/month
• Bestow: ~$30/month
• Banner Life: ~$26/month
• Ladder: ~$29/month

Rates increase with age and health conditions. Lock in coverage early for the best price.

Your life insurance decision connects to your overall financial plan. Make sure your retirement accounts are on track too.

Frequently Asked Questions

What is the best term life insurance company in 2026?

Haven Life and Banner Life consistently offer the lowest rates. Bestow is the best for no-exam speed. Guardian is best for financial strength.

How long should my term life insurance be?

Match your term to your longest financial obligation. If your mortgage has 25 years left and your youngest child is 5, a 25- to 30-year term is a reasonable choice.

Can I get term life insurance without a medical exam?

Yes. Bestow, Ladder, and Haven Life all offer no-exam options up to $1M–$3M for qualified applicants.

Is term life better than whole life?

For most people, yes. Term is far cheaper for the same coverage amount. See the full breakdown: Term vs Whole Life Insurance: Which Is Better in 2026?

What happens when my term life insurance expires?

Coverage ends. You can apply for a new policy, convert to permanent coverage (if your policy allows), or go without. If you still have dependents, apply for a new term before your old one expires.

Disclosure: This article contains affiliate links. We may earn a commission if you apply through our links, at no extra cost to you.

Most people guess at their life insurance number. They pick $500,000 or $1 million because it sounds like enough.

But your real number depends on your life. Here’s how to calculate it.

The DIME Method

DIME stands for Debt, Income, Mortgage, and Education. Add these up to get a solid starting estimate.

• D — Debt: All debts except your mortgage. Car loans, student loans, credit cards.
• I — Income: Your annual income multiplied by the number of years your family needs support. Multiply by 10 to 15 for a conservative estimate.
• M — Mortgage: Your remaining mortgage balance.
• E — Education: Estimated cost of college for each child.

Example: $25,000 in debt + ($80,000 income x 12 years) + $200,000 mortgage + $100,000 education = $1,285,000

Income Replacement Formula

A simpler method: multiply your income by 10 to 12. This gives your family time to adjust, pay off debts, and rebuild financially.

• $50,000/year income → $500,000 to $600,000 coverage
• $100,000/year income → $1,000,000 to $1,200,000 coverage
• $150,000/year income → $1,500,000 to $1,800,000 coverage

Factors That Change Your Number

You need MORE if you have:

• Young children
• A stay-at-home spouse
• A large mortgage
• Business debts you’ve personally guaranteed
• Special needs dependents who will need lifelong care

You may need LESS if you have:

• No dependents
• Large savings or investments already saved for retirement — see how much you should have saved by age
• A spouse with a high income
• Your children are already grown and financially independent

Coverage by Life Stage

Life Stage	Typical Need
Single, no dependents	$100K – $250K (cover debts, final expenses)
Married, no kids	5–7x income
Married with young kids	10–15x income (DIME method)
Kids in high school	7–10x income
Near retirement	Enough to cover final expenses + remaining debts

Don’t Forget Non-Working Spouses

A stay-at-home parent provides childcare, household management, and other services. Replacing those services has real cost. A stay-at-home spouse may need $300,000 to $500,000 in coverage even without an income to replace.

How to Buy Coverage

Once you know your number, choose a term length that matches your longest obligation. Get quotes from multiple companies. Compare our top picks: Best Term Life Insurance Companies 2026.

Lock in coverage early. A 35-year-old pays far less than a 45-year-old for the same policy.

Your life insurance is part of your financial safety net — just like your retirement savings. Both work together.

Frequently Asked Questions

Is $500,000 enough life insurance?

It depends. For a single person with no dependents, yes. For a married parent with a mortgage and young kids, probably not. Use the DIME method to calculate your real number.

Do I need life insurance if I have no dependents?

Possibly. A small policy can cover final expenses and outstanding debts. If no one depends on your income, you may not need a large policy.

Should I get term or whole life?

Most financial experts recommend term life for income replacement. It’s cheaper and covers the years you need it most. See the comparison: Term vs Whole Life Insurance.

What is a good amount of life insurance for a $100,000 salary?

A common rule of thumb is 10x to 12x your income. For $100,000, that means $1,000,000 to $1,200,000 in coverage.

Does life insurance cover student loans?

Federal student loans are forgiven at death. Private student loans may not be — check your loan terms. If you have cosigned private loans, your estate could be liable.

Disclosure: This article contains affiliate links. We may earn a commission if you apply through our links, at no extra cost to you.

Term life and whole life are the two main types of life insurance. They work very differently. Choosing the wrong one could cost you thousands.

Here’s a clear comparison to help you decide.

Term vs Whole Life: Key Differences

Feature	Term Life	Whole Life
Coverage period	10, 15, 20, 30 years	Lifetime
Premiums	Low and fixed	High and fixed
Cash value	None	Yes, grows slowly
Death benefit	If you die during term	Guaranteed payout
Flexibility	High — easy to compare and cancel	Low — surrendering early costs money
Best for	Income replacement, young families	Estate planning, lifelong coverage needs

Cost Comparison

This is where term life wins clearly. For the same death benefit, whole life costs 5 to 15 times more per month.

Example: Healthy 35-year-old, $500,000 coverage:

• Term life (20 years): ~$28/month
• Whole life: ~$350 to $500/month

That’s a difference of $300+ per month. Invested in a Roth IRA or index fund, that money could grow significantly over 20 years.

What Is Cash Value?

Whole life builds a cash value account over time. You can borrow against it or surrender the policy for cash. It sounds good. But the growth rate is slow — often 1% to 3% per year.

Compare that to historical stock market returns of 7% to 10% per year. Most financial advisors say you are better off buying term insurance and investing the difference.

When Whole Life Makes Sense

Whole life insurance is not for everyone. But there are cases where it fits:

• You have a dependent who will need lifelong support (special needs child)
• You have a large estate and need insurance for estate equalization
• You’ve maxed out your 401(k), Roth IRA, and other tax-advantaged accounts
• You are a high-income earner looking for additional tax-deferred growth

When Term Life Makes Sense

For most people, term is the right choice:

• You have young children who depend on your income
• You have a mortgage, student loans, or other debts
• You want maximum coverage for the lowest cost
• Your need for coverage has a defined endpoint (kids grow up, mortgage is paid off)

Common Mistakes to Avoid

• Buying whole life when you can’t afford the premiums. Lapsing a whole life policy early means losing money.
• Buying too little term coverage. Underinsuring leaves your family vulnerable. Calculate your real need: How Much Life Insurance Do You Need?
• Waiting too long to buy. Premiums rise with age. Buy when you’re young and healthy.
• Confusing insurance with investing. Whole life is not a great investment vehicle for most people. Keep them separate.

The “Buy Term and Invest the Difference” Strategy

This is the approach most financial planners recommend:

1. Buy a 20 or 30-year term policy to protect your family
2. Take the monthly savings versus a whole life policy
3. Invest that money in low-cost index funds
4. By the time your term ends, your investments should provide financial security

To start, look at how to open a Roth IRA and our picks for best investment apps for beginners.

Frequently Asked Questions

Is term or whole life insurance better?

For most people, term life is better. It provides more coverage for less money. Whole life suits specific estate planning needs.

Can you convert term to whole life?

Many term policies include a conversion option. You can convert to a whole life policy without a new medical exam, usually before a certain age or date.

Does whole life insurance pay out if you don’t die?

You don’t receive the death benefit while alive. But you can borrow against or surrender the cash value portion of the policy.

What happens if I stop paying whole life premiums?

If you lapse a whole life policy early, you may lose most of what you paid. After sufficient cash value builds, most policies have options to use cash value to pay premiums or receive a reduced paid-up policy.

Is whole life a good investment?

Generally, no. The cash value growth rate is slow compared to market investments. Most financial advisors recommend buying term and investing the premium difference in index funds or retirement accounts.