*My 1st concern is for our clients to be properly insured and the proper amount. I always do what is best for our clients.
Scenario: You had a term life insurance policy and converted (meaning the term life policy has now become an universal or whole life policy). Now, you would to like to know if you may convert back to term? While it is hard for me to tell someone that all permanent insurance policies are expensive, its a given that whole life policies are in fact expensive. In addition, variable life insurance policies (meaning there are life policies that are linked indirectly to the S&P, etc) with regard to the consumer-confidence in America may not be an option for every buyer.
As the article points out, no there is no such thing as converting back to term life insurance. What has to be done is a new term life insurance application needs to be completed. Be careful here!
Let's say you had a twenty-year term life policy taken out at age 30. You are now 45. Applying for the new term policy is based on age-45 or 46. That means you will pay for term rates at age 45 or 46, which obviously is higher than when you were 30. The are a few complexities to seek expertise from a professional that should bring you up to speed on your concern.
For now, I'll end this topic. I'll end in agreement with a great point from Mr. Hungelmann's article, "Believe me when I tell you that your surviving spouse and children are not going to care what kind of life insurance you had. They are only going to care about how much life insurance you had."
http://www.bankrate.com/finance/insurance/undo-term-life-insurance-conversion.aspx
Tuesday, August 28, 2012
Income Annuities Sales Up 23% Last Quarter-wsj.com
Income Annuities sales are up 23% last quarter. Consumers want guarantees and their assets to last. And looking at gold, they also want to avoid rising inflation as well.
http://www.smartmoney.com/invest/strategies/desperately-seeking-income-1346104789616/
http://www.smartmoney.com/invest/strategies/desperately-seeking-income-1346104789616/
Monday, August 27, 2012
Stay A Step Ahead of the New Medicare Surtax (Morningstar) Set to Take Effect in 2013
*Important: this takes effect in 2013!
http://news.morningstar.com/articlenet/article.aspx?id=559915
http://news.morningstar.com/articlenet/article.aspx?id=559915
Wednesday, August 22, 2012
Monday, August 20, 2012
Thursday, August 16, 2012
Grow Smart Louisville
Regarding the issue of where to build the new VA Hospital in Louisville, KY...please support this if you agree Louisville!
http://growsmartlouisville.org/
http://growsmartlouisville.org/
Wednesday, August 15, 2012
August is National Leave a Legacy Month
It is a fact that August is National Leave a Legacy Month. And while much of the articles you will see ask if what you will contribute to the world before you pass, my scope or paintbrush will not be so broad. My experience and an estate planner and insurance agent does not allow me to see broader than that for my clients or prospective clients. I ask my clients, what are your goals beyond retirement? What legacy do you want to leave behind for your family's generations?
It really doesn't matter what side of the isle you are on when it comes to politics, both spend money they don't have. With regards to leaving behind a legacy, surely you don't want to leave behind a legacy of debt for your family and especially dependents.
When a client sits down with me and as we advance into fact finding about their lives, goals and dreams I insist if there should be a balance of debt to be left behind, lets carry enough extra life insurance to cover that debt. What I feel makes me unique as an estate planner, is for the first part of my consultation, I listen. I don't make notes, don't check my phone or emails and most importantly I do not think what I can sell this couple!
If an estate planner listens carefully, the goals, the dreams and financial situation will equate to what they would like to leave as their legacy. It is difficult to have a discussion concerning a person's mortality, but it is much better to discuss this with the client than with the family when it is too late.
You've worked hard over the years to accumulate wealth, and you probably find it comforting to know that after your death the assets you leave behind will continue to be a source of support for your family, friends, and the causes that are important to you. But to ensure that your legacy reaches your heirs as you intend, you must make the proper arrangements now. There are four basic ways to leave a legacy: (1) by will, (2) by trust, (3) by beneficiary designation, and (4) by joint ownership arrangements.
Despite the loss the family is experiencing, which is tough enough, but how you be remembered fiscally? My goal is to give them as good of a good life if not better than when I was alive. Quality of life for my family is vital for me. A client should leave his or her family to grieve only for the loss, not how to make the mortgage next month.
With August being National Leave a Legacy Month it is much more than how the world will perceive you. It is simply about how will you leave your mark on your family financially, once that day comes.
It really doesn't matter what side of the isle you are on when it comes to politics, both spend money they don't have. With regards to leaving behind a legacy, surely you don't want to leave behind a legacy of debt for your family and especially dependents.
When a client sits down with me and as we advance into fact finding about their lives, goals and dreams I insist if there should be a balance of debt to be left behind, lets carry enough extra life insurance to cover that debt. What I feel makes me unique as an estate planner, is for the first part of my consultation, I listen. I don't make notes, don't check my phone or emails and most importantly I do not think what I can sell this couple!
If an estate planner listens carefully, the goals, the dreams and financial situation will equate to what they would like to leave as their legacy. It is difficult to have a discussion concerning a person's mortality, but it is much better to discuss this with the client than with the family when it is too late.
You've worked hard over the years to accumulate wealth, and you probably find it comforting to know that after your death the assets you leave behind will continue to be a source of support for your family, friends, and the causes that are important to you. But to ensure that your legacy reaches your heirs as you intend, you must make the proper arrangements now. There are four basic ways to leave a legacy: (1) by will, (2) by trust, (3) by beneficiary designation, and (4) by joint ownership arrangements.
Despite the loss the family is experiencing, which is tough enough, but how you be remembered fiscally? My goal is to give them as good of a good life if not better than when I was alive. Quality of life for my family is vital for me. A client should leave his or her family to grieve only for the loss, not how to make the mortgage next month.
With August being National Leave a Legacy Month it is much more than how the world will perceive you. It is simply about how will you leave your mark on your family financially, once that day comes.
Tuesday, August 14, 2012
How Much Does Your Financial Advisor Charge You? Do You Know?
Recently I viewed an article asking "How is My Financial Advisor Compensated?" Very good question for someone to ask. Commission-only, fee-based, Fee-only are the three methods in which I'm familiar. I work off of commission-only. For me the choice was obvious for my clients. I couldn't see handing a client a bill for my hours put into their case, as I will receive a commission on the products associated with the plan we've implemented on behalf of the client. Not all advisors who have chosen fee-based are wrong or unethical, because you have that handful of prospects (and it may be family!) every year that want a couple hours of your time, advice, etc. to not hear from them for a long time.
Again, I'm not criticizing that fee-based or fee-only advisors are the worst or evil. I'm merely giving you the information so that you, the consumer of a very important service, have the insight before you sit down with one. Yes, there are times when I wished I had a fee-based system in place for those aforementioned. For me, if I receive a $25k or higher commission for piece(s) in the plan, I may feel indifferent about sending a bill for 8 hours of estate planning at about $200/hr. In those cases where I would like a fee-based system as well, product commissions take care of the $1600 I would've billed.
Everybody is different and the method of compensation that is part of their bsuiness-fabric, is up to them. The point to not be missed here is totally the shared information. An educated consumer is a consumer who makes some of the best choices when it comes to imploring a business or individual to complete a service.
That is the reason, without judgement on those who choose a different compensation style, I tell my clients or prospective clients that I am a commissioned-based advisor.
The items within the scope of what is being planned and proposed are usually commissionable products that compensation is sufficient for my time. Usually, the more you work with higher net worth clients and market, you will see higher commissions that make it easier to choose to adopt a commission-based compensation platform.
There are numerous advisors who choose other compensation plans and could teach me something about the field I'm proud to have a career in and servicing my clients...many of which have become family friends.
Great article by Roger Wohlner http://thechicagofinancialplanner.com/2009/06/23/how-is-my-financial-advisor-compensated/
Follow Roger on twitter @rwohlner
Good stuff Roger!
Again, I'm not criticizing that fee-based or fee-only advisors are the worst or evil. I'm merely giving you the information so that you, the consumer of a very important service, have the insight before you sit down with one. Yes, there are times when I wished I had a fee-based system in place for those aforementioned. For me, if I receive a $25k or higher commission for piece(s) in the plan, I may feel indifferent about sending a bill for 8 hours of estate planning at about $200/hr. In those cases where I would like a fee-based system as well, product commissions take care of the $1600 I would've billed.
Everybody is different and the method of compensation that is part of their bsuiness-fabric, is up to them. The point to not be missed here is totally the shared information. An educated consumer is a consumer who makes some of the best choices when it comes to imploring a business or individual to complete a service.
That is the reason, without judgement on those who choose a different compensation style, I tell my clients or prospective clients that I am a commissioned-based advisor.
The items within the scope of what is being planned and proposed are usually commissionable products that compensation is sufficient for my time. Usually, the more you work with higher net worth clients and market, you will see higher commissions that make it easier to choose to adopt a commission-based compensation platform.
There are numerous advisors who choose other compensation plans and could teach me something about the field I'm proud to have a career in and servicing my clients...many of which have become family friends.
Great article by Roger Wohlner http://thechicagofinancialplanner.com/2009/06/23/how-is-my-financial-advisor-compensated/
Follow Roger on twitter @rwohlner
Good stuff Roger!
Friday, August 10, 2012
Thursday, August 9, 2012
Wednesday, August 8, 2012
Tuesday, August 7, 2012
Insurance Sales: Be Careful About Who's Hiring!
If you are or currently in the insurance industry, we have all seen the ads on job sites..."wanted sales reps for insurance company, expected 1st year earning from $60k-$100k." Then you respond. Then they contact you and invite you in for an interview. They promise an entrepreneurial lifestyle, leads & training.
Then you show up for the "interview." It seems like an interview, starting out with questions about your experience noted on your resume. You're asked what your goals are, salary expectations and your current lifestyle. My favorite question you will hear, "what is the most you've made in one year." Two-sided question, one side of it is to see if you are a good producer which there is nothing wrong with asking someone that who wants a job. The other side is where I have my problem. The other side of the coin is to make you squirm in your seat. You have been looking for an interview and a job for awhile and you're excited and vulnerable at the same time.
You think you know where I'm going with us at this point but I am getting ready to shock you. Please be careful of insurance sales positions, and this is why. The conversation has been good, you've been complimented since you came in the door. Once the interviewer figures out you may be a solid and a good producer the script proceeds as an interview. But if you seem "green" or "wet behind the ears" that script follows like a flow chart that just hit a right turn.
You now are exposed. Let's say you've been laid off, fired or you quit your last place of employment. Chances are you had a 401k where you were. Chances you haven't tapped into as of yet and if you have, shame on you! The question about that 401k comes out.
What you are now in is a sales presentation as a possible candidate for some type of annuity. They wow you by saying, "take your 401k as an example, what I would do is roll that over into an annuity (which probably has a 8-12 year contract)." Perhaps the "interview" takes that right turn and it turns into the fact finding portion of the sales presentation.
The pot gets sweeter when they speak of a bonus of up to 10% for the rollover, which they will also tell you (and is true) that when you pass from the 401k to the annuity, the taxes will not be due on the money at that time...that's a good thing normally. So, if you have $100k in your account, minus the fees of withdrawing the money from the account, you will receive the bonus of up to 10% on the balance.
You actually start thinking, this is is a good deal. You are almost convinced that you can do without the funds for 8-12 years. You have also almost forgotten why you are there. Then you wake up, then you become upset you have been pitched to during the "interview."
Something you may not know is that insurance companies subscribe to these job sites and do actually have positions open but insurance sales positions are always available because usually most positions are commission-only. And as an estate planner who started out working for such a company before starting my own firm, makes your first couple of years on a commission-only pay scale can be quite straining to say the least.
The larger part of their goal is to lure people, who they think through qualifying questions, to sign people up for an annuity contract that has a contract and surrender charge period of 8-10 years. Cruel but it could be worse. At least they didn't steal or swindle the funds out of you. But in this profession, from what I was taught and how I was raised...this is unethical.
If you don't have a consistent income from employment and/or retired with plenty of savings you do not need an annuity of any sort. There is no gray area, this is unethical behavior and wrong. And in better terms this is uncool. The bottom line you don't want to work for someone who would do this. These people will also be the people who are responsible for paying you commission on your sales!
Feel free to contact most ethical insurance professionals and they will probably tell you the same. Run! If you are seriously considering getting into the insurance field, do your research on the company. Once you sign your name you will have no one to blame but yourself.
I hope this helps!
Then you show up for the "interview." It seems like an interview, starting out with questions about your experience noted on your resume. You're asked what your goals are, salary expectations and your current lifestyle. My favorite question you will hear, "what is the most you've made in one year." Two-sided question, one side of it is to see if you are a good producer which there is nothing wrong with asking someone that who wants a job. The other side is where I have my problem. The other side of the coin is to make you squirm in your seat. You have been looking for an interview and a job for awhile and you're excited and vulnerable at the same time.
You think you know where I'm going with us at this point but I am getting ready to shock you. Please be careful of insurance sales positions, and this is why. The conversation has been good, you've been complimented since you came in the door. Once the interviewer figures out you may be a solid and a good producer the script proceeds as an interview. But if you seem "green" or "wet behind the ears" that script follows like a flow chart that just hit a right turn.
You now are exposed. Let's say you've been laid off, fired or you quit your last place of employment. Chances are you had a 401k where you were. Chances you haven't tapped into as of yet and if you have, shame on you! The question about that 401k comes out.
What you are now in is a sales presentation as a possible candidate for some type of annuity. They wow you by saying, "take your 401k as an example, what I would do is roll that over into an annuity (which probably has a 8-12 year contract)." Perhaps the "interview" takes that right turn and it turns into the fact finding portion of the sales presentation.
The pot gets sweeter when they speak of a bonus of up to 10% for the rollover, which they will also tell you (and is true) that when you pass from the 401k to the annuity, the taxes will not be due on the money at that time...that's a good thing normally. So, if you have $100k in your account, minus the fees of withdrawing the money from the account, you will receive the bonus of up to 10% on the balance.
You actually start thinking, this is is a good deal. You are almost convinced that you can do without the funds for 8-12 years. You have also almost forgotten why you are there. Then you wake up, then you become upset you have been pitched to during the "interview."
Something you may not know is that insurance companies subscribe to these job sites and do actually have positions open but insurance sales positions are always available because usually most positions are commission-only. And as an estate planner who started out working for such a company before starting my own firm, makes your first couple of years on a commission-only pay scale can be quite straining to say the least.
The larger part of their goal is to lure people, who they think through qualifying questions, to sign people up for an annuity contract that has a contract and surrender charge period of 8-10 years. Cruel but it could be worse. At least they didn't steal or swindle the funds out of you. But in this profession, from what I was taught and how I was raised...this is unethical.
If you don't have a consistent income from employment and/or retired with plenty of savings you do not need an annuity of any sort. There is no gray area, this is unethical behavior and wrong. And in better terms this is uncool. The bottom line you don't want to work for someone who would do this. These people will also be the people who are responsible for paying you commission on your sales!
Feel free to contact most ethical insurance professionals and they will probably tell you the same. Run! If you are seriously considering getting into the insurance field, do your research on the company. Once you sign your name you will have no one to blame but yourself.
I hope this helps!
Monday, August 6, 2012
Wednesday, August 1, 2012
Why I Don't Want to Buy Life Insurance?
Today, in America, life moves at an incredible pace. Each morning many people have the best intentions to get everything done but all too many times, life comes up. Estate planners, financial planners and insurance agents during their initial consultations an absence life insurance. They will also discover for clients who have life insurance that are under-insured. Forefield touches on this below.
Why I Don't Want to Buy Life Insurance
October 12, 2011
Page 1 of 2, see disclaimer on final page
If you're like most people, it's not that you don't
appreciate the value of life insurance. In fact, many
people believe they need more coverage. You
probably wouldn't mind owning additional life
insurance. It's just that you don't want to buy it.
Thinking about buying life insurance, talking about
buying life insurance, discussing the reasons for
buying life insurance--all of this makes many people
feel uncomfortable. Here are just some of the reasons
why you may be putting off buying the life insurance
you know you need.
I don't have enough time
You'll get around to buying life insurance, but not
today. With all the things you've got to do, buying life
insurance can come off as a low priority--just one
more thing you ought to do. Plus, the whole idea of
discussing life insurance isn't a whole lot of fun. Who
wouldn't rather take the dogs for a walk on the beach,
attend a child's softball game, or spend those
precious few hours of free time in the evening visiting
with friends?
Nonetheless, buying life insurance is really an
important task that should be addressed. Life
insurance can help ensure that your family will have
enough money to meet their financial obligations in
the event of your death.
The subject is boring and morbid
If you really don't like to think about death, you're not
alone. Death is an unpleasant subject, and life
insurance raises issues of our own mortality. Some
people say that the very thought of starting the life
insurance buying process makes them feel stressed
out. There's no great appeal to contemplating our own
mortality. It's a subject we'd rather ignore than
address. The result can be inertia or denial.
It doesn't have to be that way. People who do act on
their life insurance needs tend to focus on the positive
aspects: the idea of meeting their responsibilities to
provide for, and care for, their loved ones. They think
of it as contingency planning, protecting their families
against the uncertainties of life. They also recognize
that life insurance is really about life and love, about
helping to ensure a positive quality of life for their
spouse and children if they die prematurely.
I don't know where to start
If you don't have a clue about which type of policy is
right for you, or how much life insurance you need,
join the club. Few of us truly understand life
insurance: why we need it, what type of policy is best,
how much we need, when and how benefits are paid,
how benefits may be taxed, and more. That's okay.
It's not your job to know everything about life
insurance. That's the job of an insurance professional.
Thinking you need to have all of the answers about
which type of life insurance is best for you is sort of
like needing surgery and thinking you need to know
which type of scalpel to use. That's the surgeon's job.
In the same respect, the right insurance professional
can guide you through the process of selecting the
policy that best suits your needs, budget, and
objectives, and can answer your questions.
Life insurance isn't a high priority
compared with the other expenses I
have
For many underinsured people, it's not so much that
they don't want the life insurance they need; it's just
difficult to find the extra dollars to pay for it.
Buying life insurance you can't afford benefits no one.
If it causes your family hardship or requires you to
make choices that seem incongruous ("Gee kids, I'd
love to take you on vacation, but our life insurance
premium is due"), you'll eventually discontinue the
policy. Then you lose, and your family loses.
That's why it's important to purchase a policy that
meets your needs and your budget. Fortunately, there
are many types of life insurance available. These
include term life insurance policies and various types
of permanent (cash value) life insurance policies.
Term policies provide life insurance protection for a
specific period of time. If you die during the coverage
period, your beneficiary receives the policy's death
benefit. If you live to the end of the term, the policy
simply terminates, unless it automatically renews for a
new period.
Permanent insurance policies offer protection for your
entire life, regardless of future health changes,
provided you pay the premium to keep the policy in
force. As you pay your premiums, a portion of each
payment goes toward building up the policy's cash
value, which may be accessed through loans or
withdrawals. (Keep in mind, though, that loans and
withdrawals will reduce the cash value and the death
benefit, and could cause the policy to lapse). The
cash value continues to grow--tax deferred--as long
as the policy is in force.
Several different types of permanent life insurance
are available, including:
• Whole life insurance
• Universal life insurance
• Variable life
• Variable universal life
Note: Variable life and variable universal life
insurance policies are offered by prospectus, which
you can obtain from your financial professional or the
insurance company. The prospectus contains detailed
information about investment objectives, risks,
charges, and expenses. You should read the
prospectus and consider this information carefully
before purchasing a variable life or variable universal
life insurance policy.
The bottom line
It's easy to understand why people tend to put off
purchasing the life insurance they know they need.
But look at it this way: buying life insurance is one
way you can help secure your family's financial future.
And what could be better than knowing your loved
ones will be protected, even if you're no longer
around to take care of them?
Basically you have a choice in life how you can impact the future. One way is to leave a legacy for your family. Let them mourn emotionally, and not financially as well. If not adequately insured and planned, please do so. If not from me, somebody.
Why I Don't Want to Buy Life Insurance
October 12, 2011
Page 1 of 2, see disclaimer on final page
If you're like most people, it's not that you don't
appreciate the value of life insurance. In fact, many
people believe they need more coverage. You
probably wouldn't mind owning additional life
insurance. It's just that you don't want to buy it.
Thinking about buying life insurance, talking about
buying life insurance, discussing the reasons for
buying life insurance--all of this makes many people
feel uncomfortable. Here are just some of the reasons
why you may be putting off buying the life insurance
you know you need.
I don't have enough time
You'll get around to buying life insurance, but not
today. With all the things you've got to do, buying life
insurance can come off as a low priority--just one
more thing you ought to do. Plus, the whole idea of
discussing life insurance isn't a whole lot of fun. Who
wouldn't rather take the dogs for a walk on the beach,
attend a child's softball game, or spend those
precious few hours of free time in the evening visiting
with friends?
Nonetheless, buying life insurance is really an
important task that should be addressed. Life
insurance can help ensure that your family will have
enough money to meet their financial obligations in
the event of your death.
The subject is boring and morbid
If you really don't like to think about death, you're not
alone. Death is an unpleasant subject, and life
insurance raises issues of our own mortality. Some
people say that the very thought of starting the life
insurance buying process makes them feel stressed
out. There's no great appeal to contemplating our own
mortality. It's a subject we'd rather ignore than
address. The result can be inertia or denial.
It doesn't have to be that way. People who do act on
their life insurance needs tend to focus on the positive
aspects: the idea of meeting their responsibilities to
provide for, and care for, their loved ones. They think
of it as contingency planning, protecting their families
against the uncertainties of life. They also recognize
that life insurance is really about life and love, about
helping to ensure a positive quality of life for their
spouse and children if they die prematurely.
I don't know where to start
If you don't have a clue about which type of policy is
right for you, or how much life insurance you need,
join the club. Few of us truly understand life
insurance: why we need it, what type of policy is best,
how much we need, when and how benefits are paid,
how benefits may be taxed, and more. That's okay.
It's not your job to know everything about life
insurance. That's the job of an insurance professional.
Thinking you need to have all of the answers about
which type of life insurance is best for you is sort of
like needing surgery and thinking you need to know
which type of scalpel to use. That's the surgeon's job.
In the same respect, the right insurance professional
can guide you through the process of selecting the
policy that best suits your needs, budget, and
objectives, and can answer your questions.
Life insurance isn't a high priority
compared with the other expenses I
have
For many underinsured people, it's not so much that
they don't want the life insurance they need; it's just
difficult to find the extra dollars to pay for it.
Buying life insurance you can't afford benefits no one.
If it causes your family hardship or requires you to
make choices that seem incongruous ("Gee kids, I'd
love to take you on vacation, but our life insurance
premium is due"), you'll eventually discontinue the
policy. Then you lose, and your family loses.
That's why it's important to purchase a policy that
meets your needs and your budget. Fortunately, there
are many types of life insurance available. These
include term life insurance policies and various types
of permanent (cash value) life insurance policies.
Term policies provide life insurance protection for a
specific period of time. If you die during the coverage
period, your beneficiary receives the policy's death
benefit. If you live to the end of the term, the policy
simply terminates, unless it automatically renews for a
new period.
Permanent insurance policies offer protection for your
entire life, regardless of future health changes,
provided you pay the premium to keep the policy in
force. As you pay your premiums, a portion of each
payment goes toward building up the policy's cash
value, which may be accessed through loans or
withdrawals. (Keep in mind, though, that loans and
withdrawals will reduce the cash value and the death
benefit, and could cause the policy to lapse). The
cash value continues to grow--tax deferred--as long
as the policy is in force.
Several different types of permanent life insurance
are available, including:
• Whole life insurance
• Universal life insurance
• Variable life
• Variable universal life
Note: Variable life and variable universal life
insurance policies are offered by prospectus, which
you can obtain from your financial professional or the
insurance company. The prospectus contains detailed
information about investment objectives, risks,
charges, and expenses. You should read the
prospectus and consider this information carefully
before purchasing a variable life or variable universal
life insurance policy.
The bottom line
It's easy to understand why people tend to put off
purchasing the life insurance they know they need.
But look at it this way: buying life insurance is one
way you can help secure your family's financial future.
And what could be better than knowing your loved
ones will be protected, even if you're no longer
around to take care of them?
Basically you have a choice in life how you can impact the future. One way is to leave a legacy for your family. Let them mourn emotionally, and not financially as well. If not adequately insured and planned, please do so. If not from me, somebody.
Subscribe to:
Posts (Atom)