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Why You Need An Insurance Review

Why You Need An Insurance Review

Insurance is intended to protect your assets and to help cover certain risks.

Policies may have standardized language, but each insurance policy should be tailored to your needs as they are today.

A lot can change in a short amount of time. An annual insurance review is a good habit to develop to help ensure your coverage still addresses your needs.

Life changes, and then changes again, and again. There are some obvious reasons to review your life insurance coverage, like if you’re getting married or having a baby – but there are also some less obvious reasons that may change your coverage requirements, like changing jobs or experiencing a significant change in income.

Here are some of the reasons you might consider adjusting your coverage:

  • You got married
  • You got divorced
  • You started a family
  • Your income changed
  • Your health improved
  • You lost weight or quit smoking
  • You bought a house
  • You paid off your house
  • You started a business
  • You borrowed money
  • You retired

Depending on what has changed, it may be time to increase your coverage, supplement coverage with another policy, change to a different type of policy, or begin to move some money into savings or update your retirement strategy.

Have you updated your beneficiaries? Did you get married or divorced? Did you start a family? It’s time to update your beneficiaries. Life can change quickly. One thing that can happen is that policyholders may forget to update the beneficiaries for their policies. A beneficiary is the person or persons who will receive the death benefit from your life insurance policy. If there is a life insurance claim, the insurance company must follow the instructions you give when you assign beneficiaries – even if your intent may have been that someone else should be the beneficiary now. Fortunately, this can be remedied.

How long has it been since you first set up a policy? How long has it been since your last insurance review? What has changed in your life since the last time you reviewed your policies?

Your insurance needs have probably changed as well, so now is the time to make sure you have the coverage you need.


Buy Life Insurance Before the Baby

Buy Life Insurance Before the Baby

Many people buy life insurance after they have had a big change in their life. They want to make sure that there will be money for their family if something happens to them. That includes changes like…

  • Getting married
  • Buying a house
  • Loss of a loved one
  • The birth of a baby

You can get life insurance for a baby after it is born or even while the baby is still in the uterus. But it’s best to get it before you have children.

Why? Because pregnancies can cause complications for the mother – for both her own health and the initial medical exam for a policy. Red flags for insurance providers include:

  • Preeclampsia (occurs in 1 in 25 of all pregnancies)¹

  • Gestational Diabetes Mellitus (affects 2-10% of women)²

  • High cholesterol (rises during pregnancy and breastfeeding)³

  • A C-section (accounts for 32% of all deliveries)⁴

Furthermore, the benefits of youth are a powerful incentive to get life insurance for both the mother and father.

The younger you are, the easier it is to get life insurance. This can financially protect your family if you or your spouse have an unexpected event in their life.

If you are a new parent or thinking about becoming one, contact me to open up insurance for your soon-to-be growing family. We can discuss what options would be best for you.


¹ “Everything you need to know about preeclampsia,” Medical News Today, https://www.medicalnewstoday.com/articles/252025#Summary

² “Gestational Diabetes,” CDC, Aug 10, 2021, https://www.cdc.gov/diabetes/basics/gestational.html

³ “How to Manage Your Cholesterol Levels During Pregnancy,” Judith Marcin, M.D., Anna Schaefer, Healthline, https://www.healthline.com/health/pregnancy/manage-cholesterol-levels-during-pregnancy

⁴ “Births – Method of Delivery,” CDC, Oct 20, 2021, https://www.cdc.gov/nchs/fastats/delivery.htm


Life Insurance From Work May Not Be Enough

Life Insurance From Work May Not Be Enough

In some industries, the competition for good employees is as big a battle as the competition for customers.

As part of a benefits package to attract and keep talented people, many employers offer life insurance coverage. If it’s free – as the life policy often is – there’s really no reason not to take the benefit. Free is (usually) good. But free can be costly if it prevents you from seeing the big picture.

Here are a few important reasons why a life insurance policy offered through your employer shouldn’t be the only safety net you have for your family.

1. The Coverage Amount Probably Isn’t Enough.
Life insurance can serve many purposes, but two of the main reasons people buy life insurance are to pay for final expenses and to provide income replacement.

Let’s say you make around $50,000 per year. Maybe it’s less, maybe it’s more, but we tend to spend according to our income (or higher) so higher incomes usually mean higher mortgages, higher car payments, etc. It’s all relative.

In many cases, group life insurance policies offered through employers are limited to 1 or 2 years of salary (usually rounded to the nearest $1,000), as a death benefit. (The term “death benefit” is just another name for the coverage amount.)

In this example, a group life policy through an employer may only pay a $50,000 death benefit, of which $10,000 to $15,000 could go toward burial expenses. That leaves $35,000 to $40,000 to meet the needs of your spouse and family – who will probably still have a mortgage, car payment, loans, and everyday living expenses. But they’ll have one less income to cover these. If your family is relying solely on the death benefit from an employer policy, there may not be enough left over to support your loved ones.

2. A Group Life Policy Has Limited Usefulness.
The policy offered through an employer is usually a term life insurance policy for a relatively low amount. One thing to keep in mind is that the group term policy doesn’t build cash value like other types of life policies can. This makes it an ineffective way to transfer wealth to heirs because of its limited value.

Again, and to be fair, if the group policy is free, the price is right. The good news is that you can buy additional policies to help ensure your family isn’t put into an impossible situation at an already difficult time.

3. You Don’t Own The Life insurance Policy.
Because your employer owns the policy, you have no say in the type of policy or the coverage amount. In some cases, you might be able to buy supplemental insurance through the group plan, but there might be limitations on choices.

Consider building a coverage strategy with policies you own that can be tailored to your specific needs. Keep the group policy as “supplemental” coverage.

4. If You Change Jobs, You Lose Your Coverage.
This is even worse than it sounds. The obvious problem is that if you leave your job, are fired, or are laid off, the employer-provided life insurance coverage will be gone. Your new employer may or may not offer a group life policy as a benefit.

The other issue is less obvious.

Life insurance gets more expensive as we get older and, as perfectly imperfect humans, we tend to develop health conditions as we age that can lead to more expensive policies or even make us uninsurable. If you’re lulled into a false sense of security by an employer group policy, you might not buy proper coverage when you’re younger, when coverage might be less expensive and easier to get.

As with most things, it’s best to look at the big picture with life insurance. A group life policy offered through an employer isn’t a bad thing – and at no cost to the employee, the price is certainly attractive. But it probably isn’t enough coverage for most families. Think of a group policy as extra coverage. Then we can work together to design a more comprehensive life insurance strategy for your family that will help meet their needs and yours.


Life Insurance That Lasts a Lifetime

Life Insurance That Lasts a Lifetime

Most people, when they think of life insurance, might think of two types: Term Life Insurance and Whole Life Insurance.

There are two types of policies, but it’s more accurate to think of them as temporary or permanent. It’s kind of like renting an apartment vs. buying a home. When you rent, it’s probably going to be temporary, depending on your situation. However when you buy a house, the feeling is more like you’re settling down and you’ll be there for the long-haul. When you rent, you don’t build value. But when you buy, you can build more equity in your home the longer you own it.

Permanent life insurance can build a cash value, something a term policy can’t do. A term life policy only has monetary value when it pays a death benefit in a covered claim. Temporary and permanent policies also have some types of their own.

For example, term life insurance can include living benefits or critical illness coverage, as well as group term life insurance and key person life insurance, which is sometimes used in businesses. These are all designed to be temporary coverage. Here’s why. The policy might guarantee premiums for 10 years – or as long as 30 years – but after its term has expired, a term policy can become price-prohibitive. For this reason the coverage is, for all practical purposes, considered temporary.

Permanent Life Insurance: Designed to Last a Lifetime

As its name suggests, permanent life insurance is built to last. It’s a common perception that permanent life insurance and whole life insurance are synonymous, but whole life insurance is just one type of permanent life insurance.

At first glance, a permanent life insurance policy can seem more expensive than a term policy, but you’d have to consider the big picture to be fair in comparing the two options. Over the course of a full lifetime, permanent life insurance can be less costly – in part – because term policies become expensive if you require coverage after the initial term has expired. An investment element also helps to build cash value in a permanent life insurance policy, taking pressure off premiums to provide coverage.

If I’ve left you scratching your head over your options, no worries! Understanding the benefits of each type is important, and choosing which policy is best for you is a uniquely personal experience. Contact me, and we’ll review your options to find the right strategy for you and your family.


How to Build Credit When You’re Young

How to Build Credit When You’re Young

Your credit score can affect a lot more than just your interest rates or credit limits.

Your credit history can have an impact on your eligibility for rental leases, raise (or lower) your auto insurance rates, or even affect your eligibility for certain jobs (although in many cases the authorized credit reports available to third parties don’t contain your credit score if you aren’t requesting credit). Because credit history affects so many aspects of financial life, it’s important to begin building a solid credit history as early as possible.

So, where do you start?

  1. Apply for a store credit card.
    Store credit cards are a common starting point for teens and young adults, as it often can be easier to get approved for a store card than for a major credit card. As a caveat though, store card interest rates are often higher than for a standard credit card. Credit limits are also typically low – but that might not be a bad thing when you’re just getting started building your credit. A lower limit helps ensure you’ll be able to keep up with payments. Because you’re trying to build a positive history and because interest rates are often higher with a store card, it’s important to pay on time – or ideally, to pay the entire balance when you receive the statement.

  2. Become an authorized user on a parent’s credit card.
    Another common way to begin building credit is to become an authorized user on a parent’s credit card. Ultimately, the credit card account isn’t yours, so your parents would be responsible for paying the balance. (Because of this, your credit score won’t benefit as much as if you are approved for a credit card in your own name.) Another thing to keep in mind is that some credit card providers don’t report authorized users’ activity to credit bureaus.* Additionally, even if you’re only an authorized user, any missed or late payments on the card can affect your credit history negatively.

Are secured cards useful to build credit?
A secured credit card is another way to begin building credit. To secure the card, you make an initial deposit. The amount of that deposit is your credit line. If you miss a payment, the bank uses your collateral – the deposit – to pay the balance. Don’t let that make you too comfortable though. Your goal is to build a positive credit history, so if you miss payments – even though you have a prepaid deposit to fall back on – you’re still going to get a ding on your credit history. Instead, it’s best to use a small amount of your available credit each month and to pay in full when you get the statement. This will help you look like a credit superstar due to your consistently timely payments and low credit utilization.

As you build your credit history, you’ll be able to apply for credit in larger amounts, and you may even start receiving pre-approved offers. But beware. Having credit available is useful for certain emergencies and for demonstrating responsible use of credit – but you don’t need to apply for every offer you receive.


Source:
“Will Authorized User Status Help You Build Credit?” NerdWallet, Sep 24, 2021, https://discvr.co/2lAzSgt.


The Closest Without Going Over Wins

The Closest Without Going Over Wins

“How many jellybeans are in the jar?” This is one of life’s serious questions.

You know how it works. If your guess is the closest without going over, you win the prize. And whether it’s a cash pot, a season pass for your hometown’s team – or even just the jellybeans themselves, it’s a situation with a lot at stake. You’ve been presented with a ripe opportunity to prove your keen intellect, not to mention maybe winning some free candy!

You may start pulling out your old high school algebra equations. You may laboriously count the visible jellybeans so you can extrapolate the total. You may even pick the jar up and hold it to the light – shaking it and assessing any gaps in area coverage.

Take your time. It’s a big decision.

Unfortunately for many people, it seems not as much thought goes into estimating how much a life insurance policy may cost. Can you guess how much a policy might cost?

LIMRA’s 2021 Insurance Barometer study shed a little light on just how off these guesses can be: When Millennials surveyed were asked how much they thought a healthy 30-year-old would pay for a term insurance policy, their median guess was $1,000 – more than 6 times the actual cost!¹

That stat is pretty revealing: odds are that the number you have in mind is a lot higher than what you might actually end up paying for your policy. As a result, it may feel like you’re saving money right now by not having life insurance. But in the case of a sudden illness, the passing of a breadwinner, or an unexpected loss of income, not having (what is potentially affordable) protection for your loved ones feels as silly as writing down a guess of 1,000,000 jellybeans next to the mathematician’s answer of 1,086.

The bottom line: Have you overestimated how much a well-tailored life insurance policy could cost you? Not sure? Reconsider your guesstimate with a financial professional who knows the in’s and out’s of your needs and what coverage may be available that fits your budget. (It’s like knowing how many jellybeans are in the jar before you have to guess!)


¹ “Top Misconceptions About Life Insurance,” LIMRA, https://www.limra.com/siteassets/research/research-abstracts/2021/2021-insurance-barometer-study/2021_barometer-infographic.pdf.


Matters of Age

Matters of Age

The younger you are, the less expensive your life insurance may be.

Life insurance companies are more willing to offer lower premium life insurance policies to young, healthy people who will likely not need the death benefit payout of their policy for a while. (Keep in mind that exceptions for pre-existing medical conditions or certain careers exist – think “skydiving instructor”. But in many cases, the odds are more in your favor for lower premiums than you might guess.)

At this point you might be thinking, “Well, I am young and healthy, so why do I need to add another expense into my budget for something I might not need for a long time?”

Unlike a financial goal of saving up for a downpayment on your first house, waiting for “the right moment” to get life insurance – perhaps when you feel like you’re prepared enough – is less beneficial. A huge part of that is due to getting older. As your body ages, things can start to go wrong – unexpectedly and occasionally chronically. Ask any 35-year-old who just threw out their back for the first time and is now Googling every posture-perfecting stretch and cushy mattress to prevent it from happening again.

With age-related health issues in mind, remember that the premium you pay at 22 may be very different than the premium you’ll pay at 32. The reason is simple—most people physically peak by the time their 30.¹

If you’re feeling your mortality after reading those numbers, don’t worry! You’re probably not going to go to pieces like fine china hitting a cement floor on your 30th birthday. But there is one certainty as you age: your premium will rise an average of 8-10% on each birthday.² Combine that with an issue like the sudden chronic back problems from throwing your back out that one time (one time!), and your premium will likely reflect both the age increase and a pre-existing condition.

If you experience certain types of illness or injury prior to getting life insurance, it often goes in the books as a pre-existing condition, which will cause a premium to go up. Remember: the less likely a person is going to need their life insurance payout, the lower the premium will likely be. Possible scenarios like the recurrence of cancer or a sudden inability to work due to re-injury are red flags for insurance companies because it increases the likelihood that a policyholder will need their policy’s payout.

A person’s age, unique medical history, and financial goals will all factor into the process of finding the right coverage and determining the rate. So taking advantage of your youth and good health now without bringing an age-borne illness or injury to the table could be beneficial for your journey to financial independence.


Sources:
¹ “A map of the ages when you peak at everything in life,” Digital Information World, March 16, 2021, https://www.digitalinformationworld.com/2021/03/a-map-of-ages-when-you-peak-at.html#
² “How Age Affects Life Insurance Rates,” Investopedia, June 29, 2021, https://bit.ly/2L7P0x6.


Common Sources of Retirement Income

Common Sources of Retirement Income

Does retirement income sound like an oxymoron? It’s understandable—most people’s only source of income is their job.

But by definition, your job ceases to become your source of income once you retire.

Instead, you’ll need to tap into new forms of cash flow that, most likely, will need to be prepared beforehand.

Here are the most common sources of retirement income. Take note, because they could be critical to your retirement strategy.

Social Security. It’s simple—you pay into social security via your taxes, and you’re entitled to a monthly check from Uncle Sam once you retire. It’s no wonder why it’s the most commonly utilized source of retirement income.

Just know that social security alone may not afford you the retirement lifestyle you desire—the average monthly payment is only $1,543.¹ Fortunately, it’s far from your only option.

Retirement Saving Accounts. These types of accounts might be via your employer or you might have one independently. They are also popular options because they can benefit from the power of compound interest. The assumption is that when you retire, you’ll have grown enough wealth to live on for the rest of your life.

But they aren’t retirement silver bullets. They often are exposed to risk, meaning you can lose money as well as earn it. They also might be subject to different tax scenarios that aren’t necessarily favorable.

If you have a retirement savings account of any kind, meet with a licensed and qualified financial professional. They can evaluate how it fits into your overarching financial strategy.

Businesses and Real Estate. Although they are riskier and more complex, these assets can also be powerful retirement tools.

If you own a business or real estate, it’s possible that they can sustain the income generated by their revenue and rents, respectively, through retirement. Best of all, they may only require minimal upkeep on your part!

Again, starting a business and buying properties for income carry considerable risks. It’s wise to consult with a financial professional and find experienced mentorship before relying on them for retirement cash flow.

Part-time work. Like it or not, some people will have to find opportunities to sustain their lifestyle through retirement. It’s not an ideal solution, but it may be necessary, depending on your financial situation.

You may even discover that post-retirement work becomes an opportunity to pursue other hobbies, passions, or interests. Retirement can be about altering the way you live, not just having less to do.

You can’t prepare for retirement if you don’t know what to prepare for. And that means knowing and understanding your options for creating a sustainable retirement income. If unsure of how you’ll accomplish that feat, sit down with your financial professional. They can help you evaluate your position and create a realistic strategy that can truly prepare you for retirement.

This article is for informational purposes only and is not intended to promote any certain products, plans, or policies that may be available to you. Any examples used in this article are hypothetical. Before enacting a savings or retirement strategy, or purchasing a life insurance policy, seek the advice of a licensed and qualified financial professional, accountant, and/or tax expert to discuss your options.


¹ “How much Social Security will I get?” AARP, https://www.aarp.org/retirement/social-security/questions-answers/how-much-social-security-will-i-get.html


4 fundamental home buying guidelines

4 fundamental home buying guidelines

Over the course of a 30-year mortgage term, a humble home may save you thousands of dollars as opposed to a more opulent one.

Even if you abide in a smaller house than you might have envisioned as a kid, it could still provide wonderful memories while offering a haven for your family.

Home ownership can be a desirable goal, but it may become a burden, however, if the home makes you “house poor”. Imagine if every spare penny had to go toward your mortgage or upkeep of your home with nothing left over. That’s the definition of things owning you instead of you owning things. Thankfully, there’s a different way.

If you’re in the market for a new home, there are four areas to consider before you start your serious search.

Save first. You might discover there are lots of ways you could buy a house with almost no money down. However, resist the temptation of low-down-payment loans. In what could be a still-volatile housing market, you would not want to run the risk of finding yourself in a negative equity position, which means you would owe more than your house is worth. You also may pay more for Private Mortgage Insurance, which is required for home loans with less than 20% down. Before you make your move, try to save up for the 20% down payment as well as any additional amounts to help cover closing costs. You’ll also want to have an emergency fund stashed away before you buy.

Think smaller. If you don’t need a “big” house, consider buying a smaller home. Everything in smaller homes may be less expensive to replace or maintain because there’s simply less square footage involved. (The purchase price could be lower as well.)

Keep your budget under 25%. The loan officer for your mortgage might say “yes” to an amount that would cause your monthly payments to be more than 25% of your take-home pay, but that doesn’t mean those payments will fit your budget. Leaving yourself some extra margin may help you navigate life’s surprises and may give you the freedom to save more, provide more for your kids’ college, or even plan that trip you’ve always wanted to take. Bear in mind that mortgage payments may include other fees, which may increase your final monthly payment amount significantly. A 30-year mortgage may provide flexibility

When you’re focused on how much you’re borrowing, a 15-year mortgage that pays down the debt faster may be tempting. Consider a 30-year loan, though. The potential flexibility of not being obligated to a possible higher monthly payment with a 15-year loan may come in handy when those unexpected emergencies happen.

All in all, it’s worth considering your long-term outlook before you even begin your new home search.



Do I Need Life Insurance?

Do I Need Life Insurance?

It might be uncomfortable to think about the need for life insurance, but it’s an important part of your family’s financial strategy.

It helps protect your family during the grieving process, gives them time to figure out their next steps, and can provide income to cover normal bills, your mortgage, and other unforeseen expenses.

Here are some guidelines to help you figure out how much is enough to help keep your family’s future safe.

Who needs life insurance? A good rule of thumb is that you should get life insurance if you have financial dependents. That can range from children to spouses to retired parents. It’s worth remembering that you might provide financial support to loved ones in unexpected ways. A stay-at-home parent, for instance, may cover childcare or education costs. Be sure to take careful consideration when deciding who should get coverage!

What does life insurance cover? Life insurance can be used to cover a variety of unexpected expenses. Funeral costs or debts can potentially be financial and emotional strains, as can the loss of a steady income and employer-provided benefits. Think of life insurance as a buffer in these situations. It can give you a line of defense from financial concerns while you process your loss and plan for the future.

How much life insurance do you need? Everyone’s situation is different, so consider who would be financially impacted in your absence and what their needs would be.

If you’re single with no children, you may only need enough insurance to cover funeral costs and pay off any debts.

If you’re married with children, consider how long it might take your spouse to get back on their feet and be able to support your family, how much childcare and living expenses might be, and how much your children would need to attend college and start a life of their own. A rule of thumb is to purchase 10 times as much life insurance as income you would make in a year. For instance, you would probably buy a $500,000 life insurance policy if you make $50,000 a year. (Note: Be sure to talk with a qualified and licensed life insurance professional before you make any decisions.)

An older person with no kids at home may want to leave behind an inheritance for their children and grandchildren, or ensure that their spouse is cared for in their golden years.

A business owner will need a solid strategy for what would happen to the business in the event of their death, as well as enough life insurance to help ensure that employees are paid and the business can either be transferred or closed with costs covered.

Life insurance may not be anyone’s favorite topic, but it can be a lifeline to your family in the event that you are taken from them too soon. With a well thought out life insurance policy for you and your situation, you can rest knowing that your family’s future has been prepared for.



She Got the House… AND the Life Insurance Policy?

She Got the House… AND the Life Insurance Policy?

Life insurance is great for protecting your spouse… as long as it’s for your current one.

Just don’t ask Judy Marretta, formerly Judy Hillman, about it! When her ex-husband, Warren Hillman, passed away after a battle with a rare form of leukemia, she was the one who got the life insurance check. Warren’s widow didn’t see a penny of it–even the Supreme Court ruled in Marretta’s favor!

Why? When Warren remarried, he never changed the beneficiary designation on his life insurance policy.

All that time and money wasted on legal battles could have been avoided by changing a name on a form! Speaking of which… When’s the last time you reviewed your own life insurance policy? After reading this, you may already be scrambling through your files to find it!

Let’s check up on your policy together. Contact me today, and we can get the ball rolling on:

  • Reviewing (or revising!) your list of beneficiaries.
  • Making sure you have the coverage you want.
  • Discussing the life insurance features you might have that you can use now.

Discover the full story here… Forbes: “Supreme Court Favors Ex-Wife Over Widow In Battle For Life Insurance Proceeds.” 6.3.2013


Protecting and Growing Your Emergency Fund

Protecting and Growing Your Emergency Fund

Nearly 25% of Americans report that they have ZERO dollars saved for an emergency.¹

If something unexpected were to happen, do you have enough savings to get you and your family through it and back to solid ground again?

If you’re not sure you have enough set aside, being blindsided with an emergency might leave you in the awkward position of asking family or friends for a loan to tide you over. Or would you need to rack up credit card debt to get through a crisis? Dealing with a financial emergency can be stressful enough – like an unexpected hospital visit, car repairs, or even a sudden loss of employment. But having an established Emergency Fund in place before something happens can help you focus on what you need to do to get on the other side of it.

As you begin to save money to build your Emergency Fund, use these 5 rules to grow and protect your “I did not see THAT coming” stash:

1) Separate your Emergency Fund from your primary spending account. How often does the amount of money in your primary spending account fluctuate? Trips to the grocery store, direct deposit, automatic withdrawals, spontaneous splurges – the ebb and flow in your main household account can make it hard to keep track of the actual emergency money you have available. Open a separate account for your Emergency Fund so you can avoid any doubt about whether or not you can replace the water heater that decided to break right before your in-laws are scheduled to arrive.

2) Do NOT touch this account. Even though this is listed here as Rule #2, it’s really Rule #1. Once you begin setting aside money in your Emergency Fund, “fugettaboutit”… unless there actually is an emergency! Best case scenario, that money is going to sit and wait for a long time until it’s needed. However, just because it’s an “out of sight, out of mind” situation, doesn’t mean that there aren’t some important features that need to be considered for your Emergency Fund account:

  • You must be able to liquidate these funds easily (i.e., not incur penalties if you make too many withdrawals)
  • Funds should be stable (not subject to market shifts)

You definitely don’t want this money to be locked up and/or potentially lose value over time. Although these two qualities might prevent any significant gain to your account, that’s not the goal with these funds. Pressure’s off!

3) Know your number. You may hear a lot about making sure you’re saving enough for retirement and that you should never miss a life insurance premium. Solid advice. But don’t pause either of these important pieces of your financial plan to build your Emergency Fund. Instead, tack building your Emergency Fund onto your existing plan. The same way you know what amount you need to save each month for your retirement and the premium you need to pay for your life insurance policy, know how much you need to set aside regularly so you can build a comfortable Emergency Fund. A goal of at least $1,000 to three months of your income or more is recommended. Three months worth of your salary may sound high, but if you were to lose your job, you’d have at least three full months of breathing room to get back on track.

4) Avoid bank fees. These are Emergency Fund Public Enemy No. 1. Putting extra money aside can be challenging – maybe you’ve finally come to terms with giving up the daily latte from your local coffee shop. But if that precious money you’re sacrificing to save is being whittled away by bank fees – that’s downright tragic! Avoid feeling like you’re paying twice for an emergency (once for the emergency itself and second for the fees) by using an account that doesn’t charge fees and preferably doesn’t have a minimum account balance requirement or has a low one that’s easy to maintain. You should be able to find out what you’re in for on your bank’s website or by talking to an employee.

5) Get started immediately. There’s no better way to grow your Emergency Fund than to get started!

There’s always going to be something. That’s just life. You can avoid that dreaded phone call to your parents (or your children). There’s no need to apply for another credit card (or two). Start growing and protecting your own Emergency Fund today, and give yourself the gift of being prepared for the unexpected.


¹ “Nearly 25% of Americans have no emergency savings,” Quentin Fottrell, MarketWatch, Jun 9, 2020, https://www.marketwatch.com/story/nearly-25-of-americans-have-no-emergency-savings-and-lost-income-due-to-coronavirus-is-piling-on-even-more-debt-2020-06-03


Here's an Eyebrow Raiser...

Here's an Eyebrow Raiser...

The key word in ‘Life Insurance’? Life.

If your family’s quality of life were suddenly threatened, you’d step in, wouldn’t you? Of course you would!

Having a well-thought-out, tailored-to-you life insurance policy is a way to preemptively and proactively protect your family’s quality of life.

Here’s an eyebrow raiser: 36% of people surveyed intended to buy life insurance at some point, but only 54% actually have coverage!¹ Despite people’s good intentions, ownership is actually decreasing.

Here’s an eyebrow lowerer: Life insurance can be thought of as a financial safety net. One that gives your family the time and space to recover and rebuild in the event of trying financial circumstances.

Odds are, you already think life insurance is a good idea. But waiting until tragedy or a sudden loss of income strikes is waiting too long to consider the benefits of life insurance.

Give me a call or shoot me an email, and together we can take your unique circumstances into consideration and put together a life insurance policy that fits your needs.


“2020 Insurance Barometer Study Reveals a Significant Decline in Life Insurance Ownership Over the Past Decade,” LIMRA, Jun 2, 2020, https://www.limra.com/en/newsroom/news-releases/2020/2020-insurance-barometer-study-reveals-a-significant-decline-in-life-insurance-ownership-over-the-past-decade/


Two Ways to Prepare for Financial Emergencies

Two Ways to Prepare for Financial Emergencies

It’s not a matter of if, but when an unexpected financial emergency will occur.

So the best way to deal with one is to prepare for it in advance. Below are two extremely effective and relatively easy steps that can help you prepare so that when something does happen, your financial strategy isn’t thrown into disarray because of unplanned expenses.

Start an emergency fund. Your first goal will be to save up enough money to cover six months of expenses. Then when a small emergency crops up, you’ll be able to dip into this fund. But beware! You’ll need to discern what counts as an emergency—going out to eat because you don’t feel like making dinner or going shopping because there’s a great sale going on doesn’t count!

Make sure you have the right insurance. Not every issue can be solved with a simple emergency fund; serious medical issues, disability, or death can all cause financial trouble that may fall well beyond the scope of an emergency fund.

There are three things that you need to consider: health insurance, disability insurance, and life insurance. They can help provide protection for your family if you become unable to work or if hospital bills threaten your cash flow.

If you feel unprepared for a financial emergency, contact a licensed and qualified financial professional. They’ll have insights into how you can create an emergency fund, and help you evaluate your options for financial protection.


Critical Financial Moves After Your Child’s Birth

Critical Financial Moves After Your Child’s Birth

You did it! You brought an adorable, tiny human into this world. Congratulations!

By now, you’ve probably noticed that there’s a lot that goes into caring for your newest family member. Between the diaper changes, sleepless nights, and feedings, take a few moments to make these critical financial moves. They may bring you the peace of mind and financial security your family needs!

Add your child to your health insurance coverage. Once your child is born, you have between 30 and 60 days to enroll your newborn in your health insurance plan.¹ Fortunately, it’s not a difficult task. Have your child’s birth certificate and social security number handy, and then call your health insurance provider. Share the good news that you’ve had a child and would like to add them to your plan. If your health insurance plan is through work, you’ll need to contact your HR department and go through the same process.

Find the right childcare for your family. Childcare can be pricey, ranging from $9,100 to $9,600 annually.² If both you and your spouse work, you’ll need to find a way to budget in this significant expense.

Review the costs of local daycare centers. Nannies are worth investigating, but can be more expensive than other forms of childcare. Consider asking your stay-at-home friends or family if they can tend to your children while you’re away from home. You might land a sweetheart deal that builds relationships and saves you money!

Protect your family with life insurance. There is no better time to consider life insurance than after the birth of your child. Raising a kid is expensive! Food, education, and clothing can require significant financial resources. The right life insurance policy can protect your family’s financial stability even if you pass away or if you get sick or injured and can no longer earn an income. Now’s the time to provide the financial security that your loved ones may need in the future.

The first few months of a baby’s life are crazy—they depend on you for everything! Just be sure to take some time between caring for their physical and developmental needs to tend to your financial concerns. It’s one of the greatest services you can offer them!

¹ “How do I sign my new baby up for health insurance?,” Nikki Davis, Bernard Benefits, Sept 2, 2020, https://blog.bernardbenefits.com/how-do-i-sign-my-new-baby-up-for-health-insurance

² “Child Care Costs by State 2020,” Procare Solutions, Jun 24, 2020, https://www.procaresoftware.com/child-care-costs-by-state-2020/


Odds Are You're Going to Need This

Odds Are You're Going to Need This

If there’s one thing that could pose a serious threat to your retirement fund – and hard-earned independence during your Golden Years – it’s the need for long-term care.

7 out of 10 Americans over the age of 65 will need long term care at some point.¹ And the US National Median cost of a private room in a nursing home was $8,821 in 2020.² That’s $92,376 a year!

When you factor in the cost of doctor visits, medical procedures, prescriptions, etc., that number is going to keep climbing.

If your need for long-term care comes after you retire, that financial burden could fall onto your loved ones.

The right life insurance coverage has the potential to keep you living well and independently. Long-term care as a part of a tailored life insurance strategy is a great way to protect your retirement funds – and keep your loved ones’ finances protected, too.

I can help. Contact me today, and together we can explore your options for long-term care – and do what we can to help keep those Golden Years golden.

¹ “Life Insurance: Long-Term Care,” Nationwide, https://www.nationwide.com/personal/insurance/life/long-term-care/

² “Cost of Care Survey,” Genworth, 2020, https://www.genworth.com/aging-and-you/finances/cost-of-care.html


First Steps Towards Your First Home

First Steps Towards Your First Home

If you’ve checked home prices recently, you know that this is a rough time to be a first time house hunter!

2020 witnessed home prices soar by 15% to average more than $320,000–a prohibitive price for many seeking to buy their first house.¹

But even if you aren’t ready to buy a house today, there are steps you can take now that may better position you to become a homeowner in the future!

Build your emergency fund. An emergency fund is a critical line of financial defense that can help lay the foundation for buying a house. That’s because an emergency fund provides a cash cushion while you prepare to purchase your home and then begin paying off your mortgage. The unexpected expenses of homeownership can be far less detrimental to your long-term goals when you have a dedicated fund specifically designed to cover emergencies!

Increase your credit score. An excellent credit score is imperative for first time home buyers for two reasons…

First, actions that increase your credit score–debt management and paying your bills on time–can help create a solid financial foundation as you shoulder the responsibility of servicing a mortgage.

Second, lenders typically offer more favorable loan terms to people with high credit scores. That can result in more cash flow over the life of your mortgage. A recent survey discovered that mortgage holders with very good credit scores save more than $40,000 over the lifetime of their loan!²

Take steps to boost your credit score before you start house hunting. Automate your bill payments so they’re always on time, and begin reducing the balances on your credit cards, student loans, and auto loans!

Start saving for your down payment ASAP. Aim to have a down payment of at least 20% of your future home’s value saved before the home buying process begins.

Why? Because paying more up front and borrowing less to buy your home reduces the interest you’ll owe over the long-term. A substantial down payment might also lower the price of closing costs and negate your need to buy private mortgage insurance. Usually, the higher your down payment, the better!

The time to lay the groundwork for buying your first house is now. Build an emergency fund, increase your credit score, and save enough for a significant down payment. Then, search for a house that meets your needs and won’t break the bank!


¹ “U.S. home prices hit a record high in 2020. Is home buying still affordable?,” Peter Miller, The Mortgage Reports, Oct 13, 2020, https://themortgagereports.com/70539/record-high-prices-record-low-mortgage-rates-during-covid#:~:text=Home%20values%20and%20sales%20prices,on%20record%2C%E2%80%9D%20says%20Redfin.

² “Raising a ‘Fair’ Credit Score to ‘Very Good’ Could Save Over $56,000,” Kali McFadden, LendingTree, Jan 7, 2020, https://www.lendingtree.com/personal/study-raising-credit-score-saves-money/


Asking for a Friend: How Do You Pay Bills On Time?

Asking for a Friend: How Do You Pay Bills On Time?

Not paying your bills on time can have significant impacts on financial health including accumulating late fees, penalties, and a negative hit on credit scores.

But maybe you – or a friend – learned about those consequences the hard way. Most late bill payers fall into 1 of 3 camps: they forget to pay on time, they don’t have enough income, or they have enough income but spend it on other things.

In case you – or your friend – are stuck in 1 of these camps, consider the following tips to help pay the bills on time.

I forget to pay my bills on time. If this is you, you’re actually in a more advantageous position. There are many easy fixes that can help get you back on track.

  1. Use a calendar. This is a tried and true, but often underutilized, method to track your bill due dates. When you get a notice for a bill – either by email, text, or snail mail – jot the due date on your calendar. You can also set a reminder if you use an electronic calendar.

  2. Fiddle with your due dates. Many companies offer flexible due dates. Experiment with what due dates work for you. Some people like to pay their bills all together at the beginning of the month. You may find that you like to pay some bills in the beginning and some in the middle of the month. It’s up to you!

  3. Take advantage of grace period/late fee waivers. If you do forget about a bill and have to make a late payment, give the company a call and ask them to waive the late fee. Late fees can add up, ranging from $10-50 depending on the account. It’s worth a try!

I don’t have the money to pay all my bills. If your income doesn’t cover your outgo no matter how diligently you pinch those pennies, it won’t matter what type of bill payment method you use, you’re going to have trouble. If you’re in this situation, there are 2 solutions: increase your earnings or decrease your expenses.

  1. Find a side gig. Take a temporary part-time job to make some extra income. Delivering pizza in the evenings or on weekends might be worth doing for a few months to make some extra dough.

  2. Shop around. Shop around for savings. Prices vary on almost everything. Take a little extra time to make sure you’re getting the rock-bottom best prices on your insurance, cable, phone plans, groceries, utilities, etc.

I overspend and don’t have enough left to pay my bills. Managing income and expenses takes some practice and persistence, but it is doable! If you find yourself consistently overspending without enough left over to cover your bills, try the following:

  1. Create a budget. Get familiar with your income and expenses. This is the only way to know how much disposable income you’re going to end up with every month. You can track your budget daily on an app like PocketGuard, Wallet, or Home Budget.

  2. Stash the money for bills in a separate account. Put your bill money in a separate checking or savings account. This will keep it quarantined from your spending money and help make sure it’s there when the bills come due.

Good Financial Habits. If you feel bill-paying-challenged, or you have a friend who is, try some of the above tips. Taking care of your obligations when you need to can relieve stress, build good credit, and reinforce healthy spending habits for life!



Questions To Ask When Buying Mortgage Protection Insurance

Questions To Ask When Buying Mortgage Protection Insurance

Mortgage protection insurance seems like a great idea… on paper.

Afterall, you financially protect your home, your car, your health, and your life with insurance. Why not do the same for what’s typically your largest debt obligation?

But a MPI policy might not be the best way to help your family pay off the house.

Here are three questions you should ask before you buy mortgage protection insurance.

Will my payout change?

The fundamental weakness of most MPI policies is that their payout decreases over time. As you work down your mortgage, there’s technically less to protect.

That becomes a problem if your premiums don’t change even as your payout plummets. You’ll be paying the same amount for less protection!

Ask about policies that feature a level death benefit. They’ll provide you with the same amount of death benefit regardless of how much is left on your mortgage.

Will my premiums change?

Premiums for MPI aren’t always fixed. The amount you pay for protection each month might decrease or skyrocket. Your wallet is at the mercy of your insurance provider!

Just remember that fixed premiums might be a double edged sword. It may be useful to have a policy with premiums that lower over time if you don’t have a level death benefit. Ask about fixed premiums for your MPI before you find yourself paying more for less!

Would life insurance be a better option? (hint: the answer may be yes)

Term life insurance may be a better choice than MPI. Payouts are guaranteed by the insurance company and premiums are fixed. You won’t have to worry about paying more for less protection as the years go by.

It’s also flexible. A chunk of the death benefit may knock out the mortgage, while the rest can fund college, health care costs, and living expenses.

There are special circumstances where MPI is superior to term life insurance. It typically doesn’t have medical restrictions, making it a good option for people who normally wouldn’t qualify for term life insurance. Just remember to ask your financial professional these questions if you decide to learn more!


This article is for informational purposes only and is not intended to promote any certain products, plans, or insurance strategies that may be available to you. Before taking out a policy, seek the advice of a licensed financial professional, accountant, and/or tax expert to discuss your options.


The Most Important Rule For Buying Life Insurance

The Most Important Rule For Buying Life Insurance

Your life insurance coverage should be worth roughly ten times your annual income.

That’s not as crazy of a number as it might appear. Your income funds your family’s lifestyle and fuels their dreams. It’s how you pay for the house, the car, their education, and all the big and little things that make life run.

So what would happen if your income were to suddenly stop if you became ill or were to pass away?

Could your family afford to stay in the neighborhood? Would a child have to compromise their education? Would your spouse have to get an additional job to cover the daily costs of living?

Life insurance helps answer those questions in the event of your income disappearing.

So why buy a policy ten times your annual income?

First, it can act as a buffer while your family grieves and figures out next steps. A proper life insurance death benefit can allow your family to cover final expenses while they decide how to move forward.

Second, it can help your family pay off remaining debts and start funding future opportunities. This reduces the financial burden your loved ones will face in your absence.

Obviously, there are exceptions to this rule. A stay-at-home parent provides services and care that would be costly to replace and should be covered with that in mind. Families with medical concerns might need to consider a policy worth more than ten times their annual income.

But in general, a life insurance policy for ten times your income will help cover the major expenses your family will face.

Want a more precise estimate on how much life insurance you and your family need? Contact a financial professional. They can offer insights into how much coverage your specific situation calls for!


This article is for informational purposes only and is not intended to promote any certain products, plans, or strategies that may be available to you. Before purchasing a life insurance policy, seek the advice of a qualified and licensed financial professional, accountant, and/or tax expert to discuss your options.


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