With portfolios down 30 and 40% from a plunging stock market, it is nice to see steady growth in my permanent life insurance policy.  The cash value in my dividend paying whole life insurance has a guaranteed interest rate in the cash value and it will never decline in value.  While the internal rate of return may not be huge, it is good to know that it is positive every month.  I will also receive the value of a dividend if it is declared by the insurance company.  Usually good mutual life insurers will declare a dividend.   It is not guaranteed, but if you have a policy with Mass Mutual, New York Life, Guardian, etc. they usually declare a nice dividend.  A dividend is simply the return of an over collection of premium by the company.   They meet their obligations and put enough away in reserves and then declare the dividend back to their policyholders.

On top of my cash value getting better every month, it grows tax deferred.  When I access it I can get to it tax free through preferred policy loans.  At retirement, I can use the cash value as a supplement to my retirement.  First, I will withdraw money from the cash value up to my cost basis, and then use preferred policy loans.    It is truly one of the most flexible and best tax shelters available.  In fact, Walt Disney got cleaned out in the great depression with all of his stocks and only had his life insurance left.   He took a policy loan out of his life policy to start Disneyland.

Like I said, it gets better no matter what.