Life Insurance Is Probably Cheaper Than You Think

Posted by on Oct 22, 2017 in 401k, 403b, atuos, bank statements, Boomers. Millenials, cars, college planning, Consumer Tools, credit card statements, Deflation, Elder Care, estate planning, family finances, financial planning, Fixed Income Investing, Inflation, insurance, Investing, IRA, IRS, Medicaid Planning, Medicare Planning, Retire Happy Now, Retirement, retirement planning, social security, tax returns, taxes, TSA | 0 comments

Good news for those apprehensive about the premiums – and the process.   Provided by Frederick Saide, Ph.D.   According to a new study, 41% of Americans lack life insurance coverage. The 2017 Insurance Barometer Study, conducted by the non-profit organizations LIMRA and Life Happens, also discovered that while 84% of Americans felt life insurance was appropriate for most people, just 70% thought it was a good idea for them.1   What is preventing so many people from insuring themselves? Perhaps outdated perceptions about the cost of the coverage and the process of securing it. Most people think life insurance is more expensive than it really is and assume there will be a long, drawn-out path to obtaining a policy. The reality is different.   Life insurance is easier than ever to buy and not as costly as many believe. A life insurance shopper may be pleasantly surprised by the data contained in the next three paragraphs.   How much would a healthy, non-smoking 35-year-old man pay per year to maintain a whole life policy offering a $250,000 death benefit? According to LifeHappens.org, the average yearly premium is actually just under $3,000.2   How about term life? LIMRA recently asked consumers how much a healthy 30-year-old would pay annually to keep up a 20-year, $250,000 term life policy. Their median estimate was $400 – which was way off. The annual premiums would be less than half that.3   Even premiums for long-term care insurance policies have declined slightly. A new study from actuarial firm Milliman Inc., which surveyed 17 insurance companies selling standalone LTC policies, finds that the average annual premium fell by $17 in 2016 to $2,480.4   New industry regulations have encouraged insurers to lower premiums. These rules took effect in most states at the start of 2017, and they permit lower capital requirements for insurance carriers. In some cases, the regulations they replaced were literally antiquated, dating back to the Civil War. This has encouraged major carriers to reprice term coverage.3   A life insurance medical exam might soon be the exception rather than the norm. Consumers dislike these exams and the way they slow down the process of getting coverage; scheduling the doctor’s appointment, waiting on test results, and waiting on the insurance carrier’s approval can take a month or longer.   Things are changing. Insurers have begun to use algorithms to qualify applicants instead. Consumers fill out questionnaires about their health history and family health history; with their permission, the insurer culls information from past life insurance and health insurance applications, motor vehicle records, and prescription drug histories. A software program determines whether the person qualifies for coverage and the price of coverage. At...

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Minimizing Probate When Setting Up Your Estate

Posted by on Oct 4, 2017 in 401k, 403b, atuos, bank statements, Boomers. Millenials, cars, college planning, Consumer Tools, credit card statements, Deflation, Elder Care, estate planning, family finances, financial planning, Fixed Income Investing, Inflation, insurance, Investing, IRA, IRS, Medicaid Planning, Medicaid Recovery, Medicare Planning, Retire Happy Now, Retirement, retirement planning, sales, social security, tax returns, taxes, TSA | 0 comments

What can you do to lessen its impact for your heirs? Provided by Frederick Saide, Ph.D.   Probate subtly reduces the value of many estates. It can take more than a year in some cases, and attorney’s fees, appraiser’s fees, and court costs may eat up as much as 5% of a decedent’s accumulated assets.1    What do those fees pay for? In many cases, routine clerical work. Few estates require more than that. Heirs of small, five-figure estates may be allowed to claim property through affidavit, but this convenience isn’t extended for larger estates.   So, how you can exempt more of your assets from probate and its costs? Here are some ideas.   Joint accounts. Married couples may hold property as a joint tenancy. Jointly titled property includes a right of survivorship and is not subject to probate. It simply goes to the surviving spouse when one spouse passes. Some states allow a variation called tenancy by the entirety, in which married spouses each own an undivided interest in property with the right of survivorship (they need consent from the other spouse to transfer their ownership interest in the property). A few states allow community property with right of survivorship; assets titled in this way also skip the probate process.2,3   Joint accounts can still face legal challenges. A potential heir to assets in a jointly held bank account may claim that it is not a “true” joint account, but a “convenience account” where a second accountholder was added just for financial expediency (an adult child able to make deposits and pay bills for a mom or dad with dementia, for example). Also, a joint account with right of survivorship may be found inconsistent with language in a will.4   POD & TOD accounts. Payable-on-death and transfer-on-death forms are used to permit easy transfer of bank accounts and securities (and even motor vehicles, in a few states). As long as the original owner lives, the named beneficiary has no rights to claim the account funds or the security. When the original owner passes away, all the named beneficiary has to do is bring his or her I.D. and valid proof of the original owner’s death to claim the assets or securities.5   Gifts. For 2017, the I.R.S. allows you to give up to $14,000 each to as many different people as you like, tax free. By doing so, you reduce the size of your taxable estate. Gifts over $14,000 may be subject to federal gift tax (which tops out at 40%) and count against the lifetime gift tax exclusion. The lifetime gift tax exclusion is currently set at $5.49 million per individual (and correspondingly, $10.98 million per...

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Questions After the Equifax Data Breach

Posted by on Oct 1, 2017 in 401k, 403b, atuos, bank statements, Boomers. Millenials, cars, college planning, Consumer Tools, credit card statements, Deflation, Elder Care, estate planning, family finances, financial planning, Fixed Income Investing, Inflation, insurance, Investing, IRA, IRS, Medicaid Planning, Medicaid Recovery, Medicare Planning, Retire Happy Now, Retirement, retirement planning, sales, social security, tax returns, taxes, TSA, Uncategorized | 0 comments

Consumers may be at risk for many years.   Provided by Frederick Saide, Ph.D.   How long should you worry about identity theft in the wake of the Equifax hack? The correct answer might turn out to be “as long as you live.” If your personal data was copied in this cybercrime, you should at least scrutinize your credit, bank, and investment account statements in the near term. You may have to keep up that vigilance for years to come.   Cybercrooks are sophisticated in their assessment of consumer habits and consumer memories. They know that eventually, many Americans will forget about the severity and depth of this crime – and that could be the right time to strike. All those stolen Social Security and credit card numbers may be exploited in the 2020s rather than today. Or, perhaps these criminals will just wait until Equifax’s offer of free credit monitoring for consumers expires.   Equifax actually had its data breached twice this year. On September 18, Equifax said that their databases had been entered in March, nearly five months before the well-publicized, late-July violation. Its spring security effort to prevent another hack failed. Bloomberg has reported that the same hackers may be responsible for both invasions.2     Should you accept Equifax’s offer to try and protect your credit? Many consumers have, but with reservations. Some credit monitoring is better than none, but those who signed up for Equifax’s TrustedID Premier protection agreed to some troubling fine print. By enrolling in the program, they may have waived their right to join any class action lawsuits against Equifax. Equifax claims this arbitration clause does not apply to consumers who sought protection in response to the hack, but lawyers are not so sure.1   Should you freeze your credit? Some analysts recommend this move. You can request all three major credit agencies (Equifax, Experian, Trans Union) to do this for you. Freezing your credit accounts has no effect on your credit score. It stops a credit agency from giving your personal information to a creditor, which should lower your risk for identity theft. The only hassle here is that if you want to buy a home, rent an apartment, or get a new credit card, you will have to pay a fee to each of the three firms to unfreeze your credit.1   Three other steps may improve your level of protection. Change your account passwords; this simple measure could really strengthen your defenses. Choose two-factor authentication when it is offered to you – this is when an account requires not just a password, but a second code necessary for access, which is sent in a text message to the accountholder’s...

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