Final answer:
The life policy that allows investment in the stock market and other financial products is Variable Life insurance. It combines a death benefit with the potential for higher returns through investments, yet also carries the risk of fluctuating values.
Step-by-step explanation:
The life policy that offers the owner the opportunity to invest in products such as money-market funds, long-term bonds, and the stock market is the Variable Life insurance policy. Unlike other types of life insurance, variable life insurance allows policyholders to allocate a portion of their premiums to different investment options, including stocks, bonds, and mutual funds. This can potentially increase the cash value of the policy depending on the performance of the investments chosen. However, it also introduces a level of risk, as the cash value and death benefit may fluctuate based on the underlying investment performance. It's essential to consider these risks and potential returns when opting for a variable life insurance policy, especially as part of a strategy for saving for old age and building personal wealth.
Investments Tied to Life Insurance
Cash-value life insurance, like variable life, combines a death benefit with an investment component. The policyholder has control over their investments in various market options, which can offer higher returns compared to the relatively stable but lower returns of a savings account or government bonds. The ability to invest in a private market through insurance policies is a burgeoning field, offering an alternate way for individuals to plan for retirement and secure financial stability for their dependents after they pass away.