0 How to Choose a Life Insurance Agent or Financial Advisor

By Unknown | At 3:57 PM | Label : life insurance | 0 Comments

by Richard F. O’Boyle, Jr., MBA, LUTCF

The process of working with a life insurance agent or financial advisor should not be stressful, but often it is. I have spent many hours with nervous couples who were so eager to be something you really do not need or do not understand that they could not concentrate on the constructive task before them "sold". This is largely due to insurance agents and financial advisors have the reputation of being hungry sharks commission.

By entrusting the management of their retirement savings or safety net life insurance your family to a professional, you should go with a peace of mind knowing that you are putting your finances on the right track. A good agent is not only know the technical aspects of planning, but also can "see" with you to know exactly what you are and what you need.

Read the complete article...

0 How Much Life Insurance Do I Need?

By Unknown | At 3:56 PM | Label : | 0 Comments

Most people buy term life insurance to cover the financial needs of your family if they die while still depend on us. Permanent life insurance is also a useful tool transfer wealth when used for estate planning, as well as a modest savings vehicle. But by far the life insurance is used by families to pay the mortgage, raising children and putting them through college if we die young.

In general, the first step in the process of buying life insurance is to find an agent you can trust and work comfortably with. The agent will help you determine how much life insurance you should take, what kind (s), and which the company.

Read the complete article...

0 Long Term Care Insurance: The Basics

By Unknown | At 3:55 PM | Label : | 0 Comments

Few individuals or families actually plan for disability and dependence in older age. Unfortunately, lack of planning and self-learning often results in missed opportunities to prepare for potential disability. Without planning and discussion of these issues, they are forced to learn quickly about the options after a traumatic accident, diagnosis of dementia or loss of ability to care for himself available. While many of us are tough emotionally usually are not financially strong.

Read the complete article...

0 What Happens If My Life Insurance Company Goes Bankrupt?

By Unknown | At 3:53 PM | Label : | 0 Comments

by Richard F. O’Boyle, MBA, LUTCF

In recent years we have seen how seemingly solid US companies go out of business. It does not happen often, but it's a legitimate fear of all investors: What if my life insurance company goes bankrupt?

First, do not panic. Each state has a guarantee fund established by insurers that manages policies and the demands of the insolvent insurance company to another company moves and melts on the slopes with their own policies. When trouble strikes the company, you will receive a letter from the company and / or state insurance commission.
Read the complete article...

0 The Life Insurance Medical Exam

By Unknown | At 3:52 PM | Label : | 0 Comments

by Richard F. O’Boyle, MBA, LUTCF

When applying for life insurance, the foundation of the company's underwriting decision on a series of data, including a recent medical treatments, personal history, financial profile, motor vehicle registration and current medical examination. If you are requesting more than $ 1,000,000 of coverage or if you are over 60 years of age, medical requirements will be a little further.

The medical examination usually consists of a number of medical issues, blood pressure readings and pulse, and blood and urine samples. The insurance company will pick up copies of your medical records from your doctors nurse. Additional tests may be requested, most often an electrocardiogram if you have a history of severe heart disease.

Read the complete article...

0 Life Insurance: The Basics

By Unknown | At 3:51 PM | Label : | 0 Comments

by Richard F. O’Boyle, Jr., LUTCF, MBA

Life insurance policies are contracts between individuals and insurance companies to pay an amount of money set in the death of the individual covered by the policy. Most people first buy life insurance when they start a family and acquire a large expense as a mortgage because they do not want to leave their spouse and children with a wad of cash and a single income. Individuals in later life see the value of life insurance as part of their retirement and estate planning.

Obviously, the benefits of life insurance can be used to pay the final costs, such as inheritance taxes and funeral expenses. But life insurance can also provide retirees with additional options. For example, cash values ​​in the plans of permanent life insurance can be used to supplement retirement income tax-favored form. A life insurance plan can allow a retiree to choose a more generous pension option, knowing that life insurance paid to your surviving spouse. Finally, have a life insurance plan later in life gives retired the comfort of knowing that she can go through their assets and savings and their children and grandchildren will have a financial legacy.

Types of Life Insurance

Life insurance will pay your beneficiaries a fixed, always amount as the policy remains in effect, which is usually 5, 10, or 20 years. If you choose a longer term, the premium will be higher, all else being equal. The rate will increase to these time increments, and finally become unaffordable or simply terminated.

Many long-term plans offer the option to convert to a permanent plan at a future date, without evidence of insurability, that is, without further medical examination. You have to keep the same rating or classification, even if your health has deteriorated, and the duration of coverage can be extended.

Permanent life insurance such as whole life or universal life, has a higher premium, but some money is set aside in an account conservatively invested for the medium or long term. The premium permanent plan does not increase with time. There are other variants of permanent insurance Life as a variable (where the money is invested in social type accounts) or Return of Premium Plans acting much like Universal Life plans.

Note that once the life insurance, the rate will increase only by the specified amount (if it is a long-term plan) or nothing (if a permanent plan). These rates are locked in even if their health deteriorates over time.

Whole Life insurance is a permanent life insurance designed to last through their life expectancy. The premium is fixed and level as long as the owner of the policy. cash value of the policy grows at a guaranteed rate and can accumulate dividends.

Universal life insurance is a permanent life insurance with a flexible premium and cash value that grows on the basis of interest rates current market. The policy owner can choose to pay higher premiums or lower depending on their own revenue cycles.

Life insurance is temporary coverage designed to last a specified period of time - usually five, ten or twenty years. Increase premiums on a regular schedule after the initial deadline. cash value does not stack, though many plans offer a pilot conversion that allows the owner to convert the plan into a permanent policy.

Customizing the Policy with life insurance brokers

Disability Waiver of Premium: If you are unable to work due to illness or injury for six months or more, the insurance company to pay your life insurance premiums. Whole life plans continue to accumulate all programmed values ​​and cash dividends; Universal life plans generally no values ​​accumulate additional cash, but will remain in force during the period of disability.

Conversion: You can convert long-term policy "without evidence of insurability," for example, without a medical examination, one of the permanent plans offered by your insurance company. The insured must pay the new premium based on their age at the time of conversion.

Accelerated death benefit: You can take up to 80% or 90% of the death benefit in life if you are diagnosed with a terminal illness.

Family and Child Insurance: The spouse and / or dependent children of the principal insured may be covered by a percentage of the death benefit.

0 Book Review: "The Big Short: Inside the Doomsday Machine"

By Unknown | At 3:50 PM | Label : | 0 Comments

by Richard F. O’Boyle, Jr., LUTCF, MBA

In Michael Lewis expose the origins of the credit crisis from 2008 to 2009, "The Big Short: Inside the Doomsday Machine," we see how greed and ignorance created the perfect storm that led to the worst financial crisis since the Great Depression. As a financial professional who helps families and businesses plan for retirement, I help implement insurance strategies and planning. When we implement plans that often rely on third-party ratings of insurance companies and products that give us confidence that plans can be met.

In any case, the experience of the last three years should give us pause when taken for granted ratings companies such as Moody's and Standard and Poor. I'm not saying we should discard these classifications completely - instead we must carefully consider as a piece of the overall picture of financial strength. These organisms were wrong when they engaged in rating complex products, while relying almost entirely on the data supplied by the companies that have created the same products.

mortgage bonds account development and evolution of financial products such as credit default swaps Lewis is the opinion of a machine-readable insider money from Wall Street. Things went wrong when the rating agencies gave their seal of approval to these products for sophisticated investors such as hedge funds and institutions. Surprisingly, the creators of these products - Citigroup, Goldman Sachs, Merrill Lynch and other banks - often were not so sure of the value of home loans that were the foundation of the underlying bonds.

The basic problems are mortgages that formed the basis of the bonds after 2005 were subprime loans increasingly poor quality and rating models agencies do not consider that property values ​​may decrease. Moreover, banks that create products tailored to their presentations to agencies so that the credit risk of the underlying bonds were not truly diversified and therefore more risky than it seemed. Indeed, the very risky bonds were rated AAA super-safe.

This is how the products were built and what went wrong:
1. Individual mortgages are grouped into mortgage bonds. Investors in these bonds backed by assets is paid off them as individual mortgages are paid.
2. Mortgage bonds are rated for the financial stability of the rating agencies based on their assumptions about default rates by individual mortgagees. The values ​​of the underlying homes and FICO scores are two key measures that look.
3. Investors in bonds to buy insurance called "CDS" against the risk of these mortgage bonds will not bear fruit as expected (they will default). The price of this insurance is based on the rating of the mortgage bonds they received.
4. Big banks packet thousands of these smart investors bonds and swaps trading. Some banks generated many bonds they could not sell them all immediately so that they clung to them in their own accounts.
5. When adjustable rate mortgages began to reset in 2007 and 2008, the new higher rates forced many individual mortgagees to default. The cascading effect of high defaults and home values ​​sink insurance plans triggered swap credit risk.
6. Banks were forced to pay in insurance and bonds held devalue their own books. Ultimately, banks were forced to come up with more cash to shore up their finances or go bankrupt.

As I walked away after reading this book with a clearer understanding of how Wall Street works, I'm not sure this knowledge makes me more confident with the capabilities of the different actors. Lesson learned: Be careful of the herd mentality in all forms of investment. Even the most sophisticated investors can get into trouble when they get greedy and too dependent on someone else to do your own homework.

"The Big Short: Inside the Doomsday Machine" is available on Amazon.com