If you want more details on what is discussed in this video update, please listen to the full podcast here.
Despite the markets continuing to march higher, we are still encouraging caution in your investments. We want to keep an eye on our economic fundamentals, which we believe are not strong, and will soon force what looks like a bull market into a downturn. For this reason we advise keeping a high volume of cash in your portfolio.
Even with a high stock market here in the U.S., Europe is still in a serious debt crisis. Every day we hear about another country that is entering a recession, depression or instability due to this economic crisis. Because the European Union is the largest economic power in the world, it’s crucial to understand the risks and continue to face these problems with a defensive posture.
Speaking of a defensive posture, this week we are discussing our last installment of our personal finance exercise series, which today deals with life insurance, health insurance and annuities. For deeper information about our personal finance exercises, please check out our in-depth blog-post from yesterday on this topic.
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We believe that the most successful people are on top of the issues of the day. Being well-informed and staying well-organized will help you to succeed, so for the next few weeks we will be outlining six exercises for you to stay informed and ready to make good decisions. Those six exercises are:
Making a calculation of your net worth
Taking inventory of financial assets
Understanding your cash flow projections
Examining your expenses
Making sure you have an updated estate plan and living trust
Taking stock of all insurance policies – health, life, long term care, annuities, etc.
This week, we are talking about insurance: health insurance, life insurance and annuities. Insurance is an essential expense, and we encourage everyone to take a look at what you own, what you have and what you need.
There is such a thing as being “over-insured”. Sometimes life insurance can move from being an asset to becoming a liability, so getting a professional to look over your life insurance and what you need is essential. Todd Clucas is our insurance expert on staff and can help with any issues at 888-300-3684.
Annuities are a very powerful tool, but we believe that they are sometimes over-sold. Not everyone needs an annuity, but it’s important to know if you do need that option, and whether it’s worth the investment. Again, please get in touch with us if you have any questions about this or any other part of our personal finance exercise series.
Once you know what you have to can set clear, reachable goals. Tune in next week for more on Doug Fabian’s Monday Market Update. (Also, if you read this blog and enjoyed it, listen to Doug’s podcast this week for even more details on these topics, and please share this information with others who might benefit from our perspective.)
Insurance can take many forms, and the need for insurance is a very personal one. The most common reason to have a good life insurance policy in place is to replace lost income due to the death of a spouse, and to provide survivors with the financial stability necessary to not worry about fiscal issues.
For high-net-worth individuals, life insurance can be used to defer capital for retirement, and to help protect and grow that wealth for their dependents. As for annuities, they also can be very good financial instruments—if they fit your overall financial goals.
The final personal finance exercise I want you to conduct here is to do a complete review of all of your insurance products, including any annuities you may own. Ask yourself the following questions:
1) What policies do I have, and what’s the benefit amount in each policy?
2) Where are my policies, and am I dealing with more than two companies? If so, you may want to consolidate these.
3) Do I have sufficient insurance to take care of my dependents? Many people bought policies when they first were married. Now, you may have children, you may be making a lot more money than you used to, and you may have significant assets such as a home to protect.
4) What kind of premiums are you paying for your policies, and how much are you paying in annuity fees? The latter can be substantial, so if you are paying substantial annuity fees, it’s time to see if those fees can be reduced.
Performing an insurance and annuity review will give you a good idea of what you have, where you stand. It also allows you to address any flaws in your overall financial plan.
At Fabian Wealth Strategies, my investment advisory firm, we’ve set up a webpage to help you address some of the common questions involved when assessing your life insurance picture. I invite you to pay a visit to this page before you conduct your own insurance review.
If you’d like to hear more about this, as well as other personal finance exercises, and if you’d like my take on all of the market action, then sign up here for my weekly audio podcast.
Greek debt defaults, European bailouts, slow U.S. economic growth, and a stock market more volatile than any we’ve seen in years, have teamed up to knock the stuffing out of investor confidence. Now more than ever, investors feel an acute sense of fear and uncertainty regarding their financial futures.
I’m sure the latest market turmoil has you feeling a high level of anxiety about your finances as well. As we approach 2012, I believe now is a great time to get in touch with your personal financial plans, and to see how you can take the steps necessary to turn down the dial on that anxiety.
As a wealth advisor to hundreds of families and individuals around the country, I have a great deal of experience developing and updating wealth management plans for my clients. Here is an outline that my firm, Fabian Wealth Strategies, uses that can help put you on a more serene fiscal road. By reviewing each of the following aspects of your finances, we can tailor a plan that suits your specific needs.
1) Set goals and objectives. My dad, Dick Fabian, is fond of saying, “If you don’t know where you’re going, any road will do.” This means that you must have a clear understanding of your destination at all times. I coach investors to have a total return target, as well as an income stream objective, especially if they’re in retirement. This makes it easy to track your progress over time. Setting goals and objectives also includes an assessment of the disposition of other assets you own such as real estate and business interests.
2) Calculate your expenses. We all have two types of expenses—essential and discretionary. The essential are the expenses that must be paid, while the discretionary are the expenses we use to enjoy life. Part of our goal at Fabian Wealth Strategies is to help you generate more discretionary income for the enjoyable things; however, in order to do that it’s first necessary to see what your total expenses are, and how you can use strategies to minimize the essentials while maximizing the discretionary.
3) Examine your estate plans. Do you have a will? Do you have a living trust? I find that many people have a living trust, but have failed to properly fund the trust. Many haven’t updated their wills or trusts to account for changing life circumstances. At Fabian Wealth Strategies, we can help you make sure your estate plans are both up to date and sufficiently funded so that you can take care of the ones you love.
4) Review your life insurance, annuities and healthcare plans. Insurance is considered by most to be a necessary nuisance—until you actually need it. Life insurance is an invaluable tool for family security, but I’ve found that many insurance policies are outdated and extremely expensive. Annuities can be a powerful supplement to a retirement plan, but like any financial product, they must be reviewed to see if they meet your current financial goals. Health insurance gaps are becoming increasingly prevalent for many people who retire prior to Medicare kicking in.
5) Analyze your portfolios. The stocks, mutual funds and exchange-traded funds you own can either help you create wealth, or, they can take a huge bite out of what you’ve worked so hard to accumulate all of your life. Now more than ever, it’s important for you to inventory, review and assess precisely the investment vehicles you own to see if they are right for you.
I believe that 2012 will be a monumental year in terms of future direction for our country. The fall election will set the tone and frame the risks and opportunities for many years to come. If we do not start addressing our country’s financial fitness, then we will have to prepare for a weaker U.S. dollar, higher inflation and persistently slow growth. And, if the European economy falters—and I suspect that it will—we could be staring down the muzzle of a new bear market.
What this means is that it’s absolutely critical that you have the proper mix of assets in your portfolio, along with the right strategies in place to help you navigate a treacherous new year.
Success requires planning, and planning for success is what we do at Fabian Wealth Strategies.
We are a fee-only wealth management firm that helps clients achieve their goals by providing a clear pathway for success. At Fabian Wealth Strategies, we help you take the steps necessary to address the aforementioned aspects of your fiscal fitness, and it all starts with a complete review of your goals and objectives. Our individually designed client roadmap helps you see where you are now, where you’re going, and what steps are needed to get you there.
There’s no better time than the end of the year to prepare for success, and there’s no better time to get started with Fabian Wealth Strategies than right now. For more information, give us a call at (800) 391-1118.
Sincerely,
Doug Fabian
President, Fabian Wealth Strategies
3070 Bristol St, Suite 610
Costa Mesa, CA 92626
Phone: 800-391-1118
P.S. Fabian Wealth Strategies custodies their client assets at Fidelity Investments. If your accounts are already at Fidelity, it’s even easier to get started today. Simply contact one of our account representatives to schedule an appointment with me to review your goals and develop a wealth management game plan.
In this election year we are going to hear a lot about tax cuts and tax hikes, but I believe there is a much bigger story being missed by the financial media. This bigger story is the likelihood that estate taxes are going to go up no matter who wins the White House.
Sen. Obama wants higher taxes on the wealthy—including those with estates in excess of $2 million. Sen. McCain will not likely be able to fight back a Democratic majority in Congress intent on levying bigger estate taxes.
I think that regardless of who wins in November, now is the time to get your estate plan in order. In the following audio special report, I cover what I call the seven deadly sins of estate planning.
For details on this issue I turned to Kevin Yurkus, president of Fairway Capital, and one of the smartest guys I know on the subject. Fairway Capital is a sponsor of my weekly radio show, and one reason why is because I trust Kevin’s judgment when it comes to all things estate planning.
If you have assets over $2 million, you MUST listen to this special report. In it we cover such deadly estate planning sins as:
If you’re interested in reviewing your estate plan or life insurance, I recommend that you contact Fairway Capital at 800-338-1035 or visit www.fairwaycapital.net
