SGLI vs VGLI vs Private Term Life: Which Is Cheapest at Every Age?

The default conversation goes like this: "VGLI is the easy option, just convert at separation." That's true for some veterans. For others, private term life is dramatically cheaper. The right answer depends on age, health, and how much coverage you need.

Here's the math.

SGLI: While You're In

SGLI is automatic for active duty and Guard/Reserve on active orders. Premium is 6¢ per $1,000 per month, capped at $500,000 of coverage:

Coverage	Monthly cost
$500,000	$30.00
$400,000	$24.00
$300,000	$18.00
$200,000	$12.00
$100,000	$6.00

You can decline or reduce in $50K increments. Most service members keep the maximum because it's cheap, group-rated, and covers off-duty deaths and most causes including non-combat.

When you separate, SGLI continues for 120 days at no cost. After that, it ends — unless you converted to VGLI.

VGLI: After Separation

VGLI is age-banded. As of 2026, monthly premiums for $400,000 of coverage:

Age band	$400K monthly	$400K annual
Under 30	~$32	$384
30-34	~$40	$480
35-39	~$48	$576
40-44	~$64	$768
45-49	~$84	$1,008
50-54	~$144	$1,728
55-59	~$268	$3,216
60-64	~$432	$5,184
65-69	~$616	$7,392
70-74	~$960	$11,520
75-79	~$1,840	$22,080
80+	~$1,840	$22,080

The price doubles roughly every 5-10 years past age 45. By age 65 the premium is more than $7K/year for $400K of coverage — at which point most veterans either drop the coverage or accept the cost as a hedge against being uninsurable.

Private Term Life: When It Wins

Private term life pricing for healthy non-smokers (preferred best class):

Age	$500K, 20-year term	$500K, 30-year term
30	$20-25/mo	$30-40/mo
35	$25-30/mo	$40-55/mo
40	$35-45/mo	$65-85/mo
45	$55-75/mo	$110-140/mo
50	$90-120/mo	$200+/mo
55	$150-200/mo	$370+/mo
60	$260-340/mo	n/a (limited 30-yr availability)

Private term wins decisively for healthy veterans under 50. The break-even is somewhere around age 55-60 depending on health class.

The catch: private term requires medical underwriting. Service-connected conditions (especially psychiatric, cardiac, or musculoskeletal disabilities common in vets) can:

• Boost you to a worse rate class (Standard vs Preferred Best — easily 30-50% more)
• Require additional underwriting time
• Result in a decline

The 240-day VGLI window exists precisely so that veterans with conditions that hurt private underwriting can lock in coverage without medical questions.

The Decision Framework

You should keep VGLI if:

• You have a service-connected condition (especially mental health, heart, cancer history) that hurts private underwriting
• You have a recently diagnosed serious illness
• You're within the 240-day window and not yet medically cleared
• You're pre-cancer-diagnosis and can't pass underwriting at "best" rates

You should convert to private term if:

• You're under 50, healthy, and a non-smoker
• You want a longer guaranteed level term (20-30 years)
• You want coverage above $500,000 (VGLI caps at $500K)
• You have a strong tobacco-free history and can pass best-class underwriting

Hybrid strategy (often optimal):

1. Apply for VGLI in the 240-day window. Lock in the safety net.
2. Simultaneously apply for private term life with medical underwriting.
3. If private term comes back at preferred-best rates, drop VGLI and keep the cheaper private policy.
4. If private term comes back at standard or rated, keep VGLI and decline private.

Most veterans do this hybrid in the 4-8 weeks after separation. The VGLI 240-day window gives you time.

Important: VGLI Does Not Have Cash Value

VGLI is term-only. There's no investment component, no cash value, no return of premium. When you stop paying, coverage ends.

If you want permanent coverage (insurance for life rather than for a term), you need to look at:

• VALife (S-DVI) — for service-connected veterans, has a cash-value component after 2 years
• Private whole life or universal life — more flexible but more expensive

For most veterans, term coverage during the working/parenting years (20-30 years post-separation) is sufficient. Permanent life insurance is rarely necessary outside of high-net-worth estate planning or special-needs trusts.

Coverage Sizing: How Much Do You Need?

Standard rule of thumb: 10-12x your annual income as a death benefit. So:

• $60K/year salary → $600K-$720K coverage
• $100K/year salary → $1M-$1.2M coverage
• $150K/year salary → $1.5M-$1.8M coverage

VGLI caps at $500K. If you need more, you'll need to layer private term on top OR replace VGLI with a larger private policy.

The income-multiplier rule has nuance:

• More coverage if you have young children, a stay-at-home spouse, or non-working dependents
• Less coverage if your spouse earns enough to maintain the household, you have substantial savings, and your kids are independent

A common target for separating service members with young kids: $1M of total life insurance during peak earning/parenting years (ages 30-55), tapering down as kids age out and savings grow.

Term Length: Match to Need

Pick a term that covers the period during which someone depends on your income:

• 20-year term if your kids are 5+ years old (will be independent before policy ends)
• 30-year term if your kids are infants or unborn (covers them through college and launch)
• 15-year term if your spouse is near retirement and the policy bridges to retirement income

VGLI doesn't have term length — it continues as long as you pay premiums (and they keep escalating).

What About Converting VGLI Later?

You can convert VGLI to a permanent insurance policy with one of the participating commercial insurers (such as Globe Life, Mutual of Omaha, USAA Life, Northwestern Mutual, etc.) without medical underwriting, as long as you do it before the conversion deadline (varies by carrier, usually 1 year from VGLI issuance).

This is mostly used by veterans who want permanent coverage but can't pass underwriting elsewhere. Not common, but available.

Related

• VA Life Insurance Center — VGLI countdown calculator
• VGLI 240-Day Window — don't miss the deadline
• FSGLI for Spouses — what spouses do at separation