Are You a Smart Consumer of Financial Advice?

In listening carefully to the commotion coming out of Washington, one is able to find occasional bursts of sanity. I would direct your attention to all the talk about regulating the financial services industry. This talk goes way beyond the Bernie Madoff mess and speaks directly to the avalanche of complaints from people on Main Street, people just like you and me. These complaints include repetitive allegations of abusive mortgages, abusive credit card rates, abusive bank fees and abusive investment financial product sales practices.

So how can a consumer of financial advice, especially financial products, take action to prevent the word “abusive” from being applied to their transaction?

The answer lies in one specific word being used in the proposed legislation: Fiduciary. The dictionary defines this word, derived from the Latin word for faithful and when used as a noun, as a person to whom property or power is entrusted for the benefit of another. This is the very word that members of Congress want inserted into the new Financial Reform legislation. In other words, when someone asks for financial advice, if the person giving that advice receives compensation, the advice MUST be in the best interests of the buyer.

This is a pretty radical concept, eh?

So how can the average person apply the fiduciary concept to everyday transactions with real estate agents, investment advisors, insurance agents and bankers? How can a person make sure the purveyor of some product or service is really serving the customer’s needs first and foremost? This doesn’t mean the seller can’t make a profit. It just means the seller can’t make a profit at the expense of the customer. I think you’ll agree, this is a pretty simple concept.

Here is the answer: Type up the following Pledge and ask the person you’re about to do business with to sign it. If they sign, you’re good-to-go. If they won’t sign it, just go.

The Fiduciary Pledge

I, the undersigned, pledge to exercise my best efforts to always act in good faith and in the best interests of my client. I will provide written disclosure, in advance, of any conflicts of interest, which could reasonably compromise the impartiality of my advice. Moreover, in advance, I will disclose any and all fees I will receive as a result of this transaction and I will disclose any and all fees I pay to others for referring this client transaction to me.

Life Insurance Policies: Term vs Permanent

When it comes to purchasing life insurance, deciding which kind of policy to buy can be a challenge. But by learning about the characteristics of available life insurance policies and working together with an experienced life insurance agent, you’ll be able to choose the right policy to protect your loved ones.

Term Life Insurance

As the name suggests, term life insurance provides coverage for a certain period of time, as specified in your policy. This means that a death benefit will only be paid out if you die within your policy’s term. Because of this central characteristic, term life insurance policies tend to be much cheaper than permanent life insurance policies–making it a very appealing option to young adults or families who can’t spend a lot on life insurance.

Though term life insurance comes in two forms–level term (pays the same death benefit no matter when you die during the term) and decreasing term (the death benefit decreases throughout the duration of the policy)–level term policies are by far the most popular.

According to the Insurance Information Institute (I.I.I.) common types of level term policies are:

  • Annual (least popular)
  • 5 year
  • 10 year
  • 15 year
  • 20 year (most popular)
  • 25 year
  • 30 year

Many term life insurance policies are renewable, which means that you may be able to reinstate your policy after the term ends, although reinstatement may be contingent on passing a medical exam and will likely involve an increased premium. Additionally, the I.I.I. reports that most insurers will not renew a policy ending after 80 years of age.

Premiums for term life insurance are typically based on your age and health status at the time the policy is written. Some insurers guarantee your premiums to stay the same throughout the length of the term, but others may not make that guarantee (and increase your premiums throughout the term)–so be sure you’re aware of premium provisions before signing a policy.

Life insurance tip: Buying life insurance when you’re young and healthy will help you secure low premiums. Not a spring chicken? Take care of your health–stop smoking and exercise regularly to get the lowest insurance premium.

Permanent Life Insurance

Unlike term life insurance, permanent life insurance pays a death benefit whether you die they day after you sign the policy or 50 years later. Permanent life insurance policies are also appealing because of their ability to grow tax-deferred over a certain length of time–which can result in a large chunk of change. This cash value can be used in a variety of ways, providing additional benefits to policyholders and their families.

Because of these characteristics, permanent life insurance policies tend to be more expensive than term policies, which may not be conducive for young adults or families with income limitations.

Life insurance tip: Some term life policies can be converted to permanent life insurance policies, so if you’re interested in a permanent policy but can’t afford the premiums, ask your agent about term policies with this feature.

Permanent life insurance policyholders also have a wide array of policy options to choose from. The four common types of permanent life insurance are whole, universal, variable and variable-universal.

Whole life policies are the most common form of permanent life insurance and offer both a death benefit and the additional benefit of a savings account. If you buy a whole life policy, you agree to pay a certain amount for a predetermined death benefit. And, unlike a term life policy, whole life policies have the potential to earn annual dividends–which will earn interest if you let them accrue.

Universal life policies offer more flexibility, allowing you to vary how much you pay and when you make premium payments (with some limitations, of course). You may also be able to obtain a larger death benefit, provided you pass a medical exam, and like whole life policies, your universal policy may earn cash value over time.

Variable life policies incorporate a death benefit with a savings account that you can invest in stocks, bonds or mutual funds. While this may increase the value of your policy, it’s important to remember that if your investments don’t perform well, your death benefit will decrease. To avoid this, the I.I.I. says you can ask about variable policies that guarantee that the death benefit will not fall below a certain amount.

Variable-universal policies combine the features of variable and universal life policies, meaning that you have the investment options of a variable policy and the flexibility of premium payments of a universal policy.

Which Policy is Right for You?

Now that you have some idea of what policy options appeal to you, take the time to speak with a licensed life insurance professional that can answer questions and help you come closer to your life insurance decision. Because when you have all the facts, it makes finding affordable life insurance that much easier!

Unclaimed Life Insurance Policies – Introduction

The business of life insurance is serious business and the business of unclaimed life insurance cash is a serious problem. Many people believe that a loved one who has life insurance at the time of their death somehow magically advises the company of their death and the policy is paid. That is obviously not the case. Just because someone had a life insurance policy and died doesn’t mean that their beneficiaries automatically get the money that the deceased wished to leave for them. Somebody who is still living after the insured’s death had better know where to locate that policy and provide it, along with documented proof of the insured’s death, to the insurance company or else insurance proceeds will not be paid out; and right now, today, as you read this, BILLIONS of dollars are waiting to be paid out!

Make no mistake – insurance companies are in the business of paying claims and that’s what they will try to do. But there is a procedure that must be followed and that procedure begins with notification.

Once the legitimacy of a claim has been established, funds will be paid out. If there is a problem with establishing legitimacy, funds will be held until any problems are cleared up. If problems are not cleared up and legitimacy cannot be established, money, which the company doesn’t get to keep but which also won’t go to intended beneficiaries, remains unclaimed… and right now, today, as you read this, BILLIONS of dollars are waiting to be paid!

The procedure must, however, begin with notification.

Now, what might you, the living insured, do to make sure that your insurance proceeds get paid out per your wishes? Well, aside from assuring that all of the pertinent policy information is accurate and up to date, you MUST make sure that beneficiaries know that they are beneficiaries and, ideally, where to Find Lost Life Insurance Policy documents. At the very least, you must make them aware of the company or companies that issued the coverage and policy numbers. Otherwise the payment procedure breaks down and money goes unclaimed. (Also, don’t forget that if someone that you have designated as a beneficiary predeceases you, you need to update your beneficiary designations).

What to Do if You Are a Beneficiary

If you are certain of being a beneficiary or you are an executor of the decedent’s estate but he/she never told you where to find the policy information or even the name of the company, there are things that you can do to find the information that you need.

To start with, if you have any idea of the financial companies that the deceased did business with, make some telephone calls. Ask to speak with someone in the Claims or the Life or Policy Owner Service area. Explain the situation and ask how you may request that they do a search for any coverage that may exist/have existed on your loved one. Or, if you know that the deceased had a financial adviser, definitely call him/her. There is a good chance that he/she will have the information that you are looking for.

Also, because many employees simply go with employer-provided group life insurance, if the decedent was still working at the time of death, check with his/her employer. Or, if he/she was retired and receiving a pension, check with the retirement administrator.

Safe deposit boxes are one of the places where people routinely keep important papers. Don’t overlook this possibility. If these efforts fail you can look into hiring a private investigator who may have resources and legal allowances that you don’t.

If you are a beneficiary, don’t put insurance proceeds… and your loved one’s wishes to provide for survivors… at risk. Talk to your insured loved ones while talk is still possible. The subject is not an easy one to bring up but it is one that must be addressed. Not doing so could frustrate your loved one’s wishes and cost you thousands, even hundreds of thousands of dollars.

Where to Get the Best Financial Advice?

Savings and the first 10 years of adulthood

The secret of a financial well being is following good financial advice. However, while there is found arbitrary financial advices in galore, only a few can make the real difference. And one among them is definitely an advice to start saving early, which seems a tough one to embark upon as soon as money starts flowing in. However, fact remains that people still can continue living on a shoestring budget like the college days since old habits die hard. But once you get used to luxury and lavishness right from the start, saving for the later days becomes a hard-to-accomplish dream.  

The secret is to consider the total monthly sum you are receiving as your total turnover; you need to fix a salary for yourself to meet your expenditures; the remaining amount should be kept aside. If you are still a bachelor, then this is the right time to embark upon the process; if you are married and even nearing your 50s, you are still not too late.

Use the strategy to make money. Albeit there shall be an initial period of struggle, it shall ensure the golden days ahead.

Help at Hand
Now, that was just an example of one of the methods you can use to save money; the simplest one that shows you how to accumulate the greater part of your earnings. But the real trick is to put your money into action, which can only be accomplished if there come sound financial advices from people who know their job. However, it used to be the toughest part finding them out; now, that Wiser has marked its online presence by bringing together the most renowned and reliable financial advisors from all over the country, you job turned easier by a few more times.

Therefore, to put into use what you are willing to save, you need a financial advisor to guide you. So remember the last point – you need to achieve more from your money – therefore; if you are planning to seek the best financial advice, a visit to WiserAdvisor shall let you access to an entire domain of financial advisors who shall let your money grow, even covering the cost of hiring one of the financial advisors.