All About Life Insurance and Financial Planning: December 2009

Financial planning is the long-term process of wisely managing your finances so you can achieve your goals and dreams, while at the same time negotiating the financial barriers that inevitably arise in every stage of life by Creating a Sound Financial Plan
Step 1 Establish Goals
Step 2 Gather Data
Step 3 Analyze & Evaluate Your Financial Status
Step 4 Develop a Plan
Step 5 Implement the Plan
Step 6 Monitor the Plan & Make Necessary Adjustments

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Practically All Areas Of Household

Financial Planning and How to Be Smart in Spending

By Stephen Kavita

A financial psychologist once said that to make smart decisions regarding your money, you need to let the logical side of your brain rather than the emotional one to dominate. Avoid being emotionally attached to your investments. There are people who would cling to certain stocks because they inherited from their parents and their parents used to love them or because they work for the company and selling would be disloyal.

Before purchasing something evaluate whether the product or service is worth that price in enjoyment considering how you will use it and if you can get the same quality for less. Beware of retaliatory spending; do not ever go on a shopping spree because you are stressed, or you have had a fight with your partner or an argument with your boss. No matter how better you think it will make you feel, it will damage your financial health.

It is wise not to cling on to debt. For instance, there are people with money in their savings account earning less than two percent, and have debt in their credit cards that are being charged more than fourteen percent. It is good to save for a rainy day, but if you have more than enough savings you can pay your debt and save on huge debt card interests. Then rebuild the savings, not the debt. For emergency purposes; you still have the credit cards (now with zero balances), and you can tap them in.

If you make a mistake in your investments, do not go the way you anticipated or stay in denial; losses do not go away just because you did not look at them. Asses where you are and figure out what to do instead of waiting for things to get worse.

Stephen shares his experience in Self Development Tips that will definitely Add Value to your Life. (Website:) Self Improvement Tips

Article Source: http://EzineArticles.com/?expert=Stephen_Kavita

10 Questions You Should Ask a Financial Advisor Or Financial Planner

By Dan Goldie

If you are considering hiring a professional to help you with your investments and personal financial planning, you should come to the first meeting prepared with questions that will help you to evaluate if the advisor is right for you.

The questions below are intended to give you a good sense of the background, business structure, advisory style, and qualifications of a prospective advisor or planner:

1. What are your professional qualifications and designations, including formal educational degrees?

An advisor who has earned one or more professional designations has demonstrated a commitment to education and professionalism, and at least a reasonable proficiency in his or her field. Some common professional financial designations include: Certified Financial Planner (CFP), Chartered Financial Analyst (CFA), Certified Public Accountant (CPA), and Chartered Financial Consultant (ChFC).

Just as you might inquire about a potential employee's formal education, knowing where an advisor went to school and what they studied can help indicate their level of general intelligence, knowledge, and ability to problem solve.

2. How long have you been an advisor, how many clients do you have, and how much money do you manage?

This information will help you evaluate an advisor's level of experience and relative success. You may want to avoid an advisor with too little experience, or one who has too few or too many clients. In general, successful advisors will have more clients in assets under management than less successful ones.

3. Who are your ideal clients?

It can be helpful to understand the types of clients an advisor feels are a good fit for their practice. You don't want to be an unusual client; it is better to fit well within an advisor's client base so that you benefit from the advisor's experience with others like you.

4. How are you compensated?

Financial advisors are compensated in a variety of ways. It is important that you understand exactly how and advisor benefits financially from the advice he or she will be giving you. You may decide that you prefer one method of compensation over another, due to personal preference, potential conflicts of interest, or other reasons.

5. Who will be handling my account?

Some advisory firms assign teams of professionals and backup staff to work with clients. Smaller firms usually have just one advisor working with each client. There can be benefits and drawbacks to both models, and it is important that you understand the potential relationship so you can make a decision that you feel will be best for you.

6. How will you communicate with me and my other advisors?

It is important that you receive frequent, clear, and accurate communications from your advisor, and that they will work well with your other advisors (such as your accountant and attorney). You should also feel confident that your advisor will be available for you promptly should you have a question, or want to meet to discuss something.

7. What services do you provide?

Some advisors only offer asset management services while others will offer a more complete set of services that may include personal financial planning. You want to be sure you know exactly what services you are going to get and how they will be delivered before you become a client.

8. What is your investment and financial planning philosophy?

There are a variety of different investment philosophies and approaches to financial planning. It is important that your advisor's way of managing money is consistent with your own. This is an essential area of said for a successful long-term relationship.

9. Do you take custody of client assets?

Safety of your assets is imperative, so most independent advisors use a third-party custodian firm, such as Charles Schwab, TD Waterhouse, Vanguard, or Fidelity. Advisors who are registered representatives will likely custody your assets at the brokerage firm with which they are affiliated. Beware of advisors who don't use an outside custodian.

10. What makes you different from others?

A good advisor should be able to clearly explain to you how working with them is uniquely different from working with someone else. This question gives your advisor a chance to identify their strengths, thus giving you the opportunity to make an assessment.

Dan Goldie is an independent financial advisor and financial planner working with high net worth individuals and families.

Investment advice provided through Dan Goldie Financial Services LLC, a Registered Investment Advisor.

Article Source: http://EzineArticles.com/?expert=Dan_Goldie

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By Cornie Herring

Financial planning is important to ensure you stay in control of your money for current and future. It covers a wide range of money topics that you must learn up if you want to continue stay health financially. We will discuss some important topics about financial planning and how each of these topics works together and affecting your financial healthiness.

Among the important topics that you should know when trying to understand about financial planning are: budgeting, expenses, debts, savings, retirement and insurance. Let's discuss them one by one.

Budgeting

The most basic level of personal finance is how to allocate your money so that your money is always in positive flow, it's called budgeting. Budgeting is a process of allocating your money so that you know how much your spending and where the money has gone. Your budgeting plan should be based on your financial condition to allocate the money according to the priority of your primary needs.

Expenses

After you have created a budget plan, you will have better control on where your money goes and what are the optional expenses that you can trim off. For many people, cutting expenses on such little things that are optional to your needs can add up to significant savings which you can use toward investment to create your future estate.

Debts

You may not be able to avoid debt totally because you may get loans for buying home, car or business investment. But, your debt should always be at controllable level. When you do your financial planning, you should take into consideration about your debts so that you have plans to get rid of them.

Savings

Allocating money into saving accounts is an important step in financial planning process. You may need money for emergency needs, as your kid's educational funds, for planning for your retirement & etc. With fewer companies offering full pension plans and the uncertainty of Social Security, it has important to plan a fund that you can put aside to be used during the emergency situation.

Retirement Planning

The quality of life you want after the retirement will depend on your current contribution. You will probably want to retire happily with financially peaceful mind. Therefore, you have to include your retirement plan when you perform the financial planning.

Insurance

Major illnesses, disaster, accidents and many other incidents may happen without warning and they may cause a sudden need of big amount of money, which our emergency fund may not be sufficient to resolve them. Here, comes the important of insurance in our financial planning. It should be included into your financial plan to provide protection to your lovely family members against the unexpected such as illness or loss of income sources due to dead.

Summary

Financial planning is a process of estimating the current & future financial needs, and making plans to achieve them. The above elements are the key elements involved in financial planning, which you need to take into consideration when planning your financial needs.

Visit Cornie Herring's website at http://www.studykiosk.com/CreditBasics to find more debt relief resources on the option available for you to get rid of debt. Learn how debt consolidation, credit counseling and other debt solutions work in helping debtors to resolve their debt issues.

Article Source: http://EzineArticles.com/?expert=Cornie_Herring

Life Insurance Reality Check - Do You Have Enough?

By Denise M

Life insurance is an important component of your financial planning. If you have a young family, it could actually be the most important element of their security. A lot of people do not have affordable life insurance yet. Among those who already have life insurance, a vast majority does not have enough coverage. Could you be one of them?

What kind of insurance is best?

Life insurance policies come in two basic variants - whole life and term insurance. Whole life insurance offers death benefits plus cash value on account of which premiums are higher. On the other hand term insurance is affordable because it only concentrates on death benefits for which you pay cheaper premiums. When you are young with a lifetime of loans, expenses and mortgage payments to be paid, children's' education and upbringing to look after, you must consider the more affordable term life insurance. Since a term life policy can help you focus on just the death benefits, it makes sense to understand it better, and work out the best coverage amount possible.

What kind of expenses and financial needs should a term life policy cover?

On the event of your death, the death benefit of your term life insurance policy should be able to have your family pay off your funeral expenses and invest the rest so that they can lead a comfortable life much like the one you provide for them now.

Funeral expenses can work out to be as high as $5,000-$12,000 currently, so that's why you will need to factor that in to your life insurance planning.
Next, your death benefit should replace your current income, so that your family can carry on with life without having to make major lifestyle changes. Remember to take into account inflation and rising costs.
Thirdly, factor in your debts - unpaid mortgage, credit cards and loans could eat into the death benefit amount, leaving your family with very little to take care of other expenses.
If you were to die, your family would surely have additional expenses to replace the services you used to take care of yourself. If you handle the accounts on your own, or take care of the plumbing yourself, your family may need to hire the services of an accountant, or a plumber. If your spouse is currently a stay at home parent, your family may need the services of a nanny in case he or she decides to start working to supplement their income. It's the little details that will help you work out your family's expense requirements better.
If your kids are young, a part of the death benefit will have to be invested to pay for their college education.
Consider any hidden income that you may be currently earning, but which would be lost at death. Examples are your perks, your employer's contributions to your 401(k) plan, health insurance and your retirement fund contributions. Too many people overlook factoring this into their calculations while in actuality they could easily add up to $10,000-$12,000.

How to calculate the coverage amount

There are conflicting views on how to arrive at the perfect coverage amount for your life. Here's an alarming statistic. The average American has about $170,000 in life insurance coverage. That seems like a lot, but it is only about four times of the average annual income in the U.S. So it's going to tide your family over for four years, but remember that you're going to be dead a lot longer than four years. So how do you calculate the ideal coverage amount?

The rule of thumb in the insurance industry says that your coverage should be 10 to 20 times your annual income. However, like we discussed earlier, annual income is not the only factor that should be considered when determining your needs. How much term life insurance you need is a highly individual figure. But if you know exactly what your death benefits should help pay for, then you definitely won't make the mistake of under-insuring yourself. So the long and short of the 'how much is enough' dilemma is that the death benefit you provide your family should be more than your net worth. Use the help of online Life Insurance Tools such as a Life Insurance Needs Calculator to help you arrive at an accurate coverage for your personal situation. Then you can apply for term life insurance quotes.

How often should your policy be reviewed?

If you already own a term insurance policy, that's not enough reason to think that you have enough death benefit. If you have failed to consider the expenses and the loss of income sources that may follow your death, you will need to review your policy.

Even if you have taken everything into consideration, experts recommend that you review your policy whenever there is a life changing event such as the arrival of a baby, taking in an additional family member, changing jobs, looking after ailing parents, or the loss of a spouse. These events will increase your expenditure.

In times of recession the value your investments drastically dip, while your life insurance benefits remain the same. If you were to die in the next two years, your investments would have accrued a lower income than expected due to the present economic crunch. Have you factored this into your life insurance plan? You may need to review your term policy especially during economic downturns.

Conclusion

The best way to review your term insurance policy or work out the death benefits on a fresh term life policy is to consult with an unbiased insurance advisor, preferably one who represents a large number of life insurance companies. The advisor will ask you in-depth questions on your finances and help you arrive at term life quotes that are just right for your family's needs.

AccuQuote is a leader in providing term life insurance quotes to people across the United States. In 1986 it began operating with a single goal: to make the process of buying term life insurance as easy as possible for its customers. Their experienced professionals consistently deliver the most affordable term life insurance rates by comparing thousands of life insurance policies from dozens of top-rated carriers.

Article Source: http://EzineArticles.com/?expert=Denise_M

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All About Life Insurance and Financial Planning

Sunday, December 27, 2009

Update Dec. 27 - 2009 All About "Life Insurance and Financial Planning" By Insurance Experts

Monday, December 7, 2009

Update Dec. 07 - 2009 All About "Life Insurance and Financial Planning" By Insurance Experts

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