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October 18, 2011

Educated Consumers

A recent survey by LIMRA (an association that provides research and consulting to insurance companies) found that 86% of Americans believe most people need life insurance. Yet according to LIMRA, there are 95 million people without any life insurance at all and most who do have life insurance have only a small policy through their job. The reason given most frequently by those who don't own life insurance was that it is too expensive. Since life insurance rates are at historic lows, this perception of being too expensive might be due to many people not being offered all of the excellent policies options available to them. If you talk to an agent who sells for only one company, or prefers to focus his efforts on selling whole life policies, how are you supposed to know what other choices are out there?

At our affiliated website, www.QuotyPie.com, we feel that an educated consumer is our best customer. That's why we provide unlimited, anonymous quotes. You can even compare companies we don't sell. We've pulled back the curtain so you can see for yourself what's available. So spend some time on our website and then give us a call so we can help determine which company, policy type and face amount is best for you.

September 9, 2011

Term Insurance VS. Permanent Insurance

Should you have term insurance or Permanent (whole life) insurance? I've always said that the best insurance to have is one that is paid current and in force on the day you die. I've never seen one beneficiary receive a check and care what type of insurance it was.

When analyzing your life insurance needs the first thing to ask yourself is, what are you buying the insurance for? The answer will help you determine which type of insurance you need. If you just purchased a home and you are buying the insurance to pay off your house if you die, then term is the answer. If you have a young family and you want to make sure they are provided for if something should happen to you, at least until your kids grow up and move out, then term is the way to go as well. In general, if you are between the ages of 20 – 60 and have a temporary need for death benefit protection, term insurance will in most cases provide the affordable premium for an appropriate death benefit. The policy can be locked in for an extended period of time. Once that need is not there anymore (house is paid off, kids go out on their own, etc.), your life insurance requirements should change and you can reevaluate your situation.

So when should permanent insurance be considered? My opinion is that if you are over age 60 and you have a specific need for a death benefit, you should consider a premium that will never increase or expire. The reason for needing the insurance could be something as simple as paying for a funeral. Another example could be if a husband or wife is receiving a pension payment that will stop on the day they die. They can use a life insurance policy to replace this income stream to provide for the surviving spouse. If you are in your retirement years and want to be 100% certain that you won't outlive your policy, you need to consider a permanent plan. Once again, if you outlive your term insurance in your retirement, (this would be good news) you could be left with very few insurance options at that late age.

May 16, 2011

The Opportunity with a Fixed Index Annuity

Are you giving up opportunity with a Fixed Index Annuity? Consider a Fixed Indexed Annuity with a 10% bonus and 4.75% cap over a 10 year period verse a hypothetical return of 8% per year. Let's assume you average 8% per year for 8 years and there are two down years where you lose 8%. The annuity earns 4.75% for 8 years and a zero for 2 years when the market is down. Which return do you think will be higher? Let's take a look:

FIA Market
4.75% 8%
$115,225.00 Year 1 $108,000.00
$120,698.19 Year 2 $116,640.00
$120,698.19 Year 3 $107,308.80
$126,431.35 Year 4 $115,893.50
$132,436.84 Year 5 $125,164.98
$138,727.59 Year 6 $135,178.18
$145,317.15 Year 7 $145,992.44
$152,219.72 Year 8 $157,671.83
$152,219.72 Year 9 $145,058.09
$159,450.15 Year 10 $156,662.73

Some folks might look at this and say, "I will earn more than 8% in the market." In some years that is definitely true, but if you consistently averaged 8% per year after expenses, your net account balance should double in just about 9 years. Has your net account balance consistently doubled every 9 years?

May 11, 2011

Baby Boomers Want Annuities

A recent study was conducted by Allianz Life Insurance Company that surveyed 3300 baby boomers about their financial opinions regarding saving/planning for retirement. Some of the results point to what I think is a seismic shift away from what was very recently considered conventional thinking. One question that was asked was, if you could put your money in an investment that could earn you 8% with the chance of loss, or another investment that guaranteed 4% with no chance of loss, which one would you pick? The respondents clearly chose the safe option.

Now if the survey asked the question like this: would you like to put your money in an annuity, I think the first reaction of most would be no. But they seem to be asking for what an annuity can do. Why is that? Maybe it's because most people haven't looked at annuities in many years. Maybe it's because so much misinformation and half truths are printed on a regular basis by financial publications regarding fixed and fixed indexed annuities.

If you haven't looked at some of the new annuities that are on the market that can keep your money safe, guarantee you growth and guaranteed you an income you can't outlive, then now is the time. Check out this website:

http://thehiddentruthaboutannuities.info/#annuitiescon

This website gathers third-party information from a wide variety of sources and publishes articles and videos about everything having to do with indexed annuities and annuities in general.

February 9, 2011

While watching the super bowl between the Packers and the Steelers, a thought crossed my mind. What if you could choose to be awarded 30% or so more points for each score so that a touchdown and extra point, instead of being worth 7 points, would be worth 10 and field goals worth 4? Sounds good doesn't it? Would you take that arrangement over the current rules? But there's one catch. At anytime, with no warning, you could have 50% of your points taken away. In the 4th quarter, your team is winning 34 to 24 when both teams scored 3 touchdowns and one field goal. But with 2:00 minutes left in the game, your team's points are reduced to 17. Would that seem like a fair way to play the game? Would you rather earn less points, but keep all of them until the end of the game, or get more per score hoping that you don't lose them before the clock hits zero?

I'd rather keep what I earn. That's why I offer my clients strategies that won't take away your interest or even worse, principal. An indexed annuity doesn't get you all of the up in the market. But Moderate gains that never experience a loss can outperform a volatile market.

February 1, 2011

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