Friday, July 19, 2013

Are you ready for retirement?

Are you ready for retirement? Hope for the best; Plan for the worst
=The best guarantee for the future is having money
=Financial advisors can't predict the future
=Make a plan for the future or the government will
Pension funds like the one for California workers (CalPERS) have 63% equities, 23% fixed income and 14% other assets like real estate, forests, etc. Very little is in risky investments like hedge funds or gold.  By Ian Sender, former director, Wall Street firm

Annuity sales tactics you should avoid
When sales people hear that their products are expensive—3% a year or more, they claim that the benefits of death benefit and their sage advice are worth it. Most annuities never pay death benefits. Tax advantages are less than a regular investment account. Advice is not useful unless you are investing $100,000 or more.
Free email article available at
There are more sales tactics you should avoid:

How does your Medicare Advantage plan rate?
Out of five possible stars, 85 percent of AARP's plans fell into the 3.0-3.5 range, with 8.7 percent in the 4.0 range and no plans achieving an excellent 4.5 or 5.0 score. In comparison, 31 percent of non-AARP plans achieved a score of 4.0 or higher. The highest performing competitors across contracts were nonprofit health plans, including Kaiser; Gunderson Lutheran Health System; Baystate Health; and HealthPartners. Certain for-profit plans also had higher average contract scores than AARP, including Humana and Aetna. Compare plans at

Long-term care insurance usage study—Half used for home care
The majority of new long term care insurance claims in 2012 started after the policyholder was age 70. "Over two-thirds (68%) of new claims began after the policyholder turned 80," a study reports. "About one-in-four (23.5%) started their claim between ages 70 and 79. Roughly half of newly opened claimants received benefits for covered home care services with the rest paying for care in assisted living communities or skilled nursing homes. The most common reasons for a long term care insurance claim are Alzheimer’s disease, stroke, arthritis, circulatory issues or injury." Only 4% of men require institutional care. Consider alternatives:

Car dealers now offer insurance in SC
Love Chevrolet and the Allstate Insurance Company partnered to open a new agency inside the dealership in Irmo that will sell a full-range of insurance products, including automotive, home and life insurance. Called Love Insurance and Financial Services, the agency is the first of its kind in South Carolina and is designed to create a one-stop shop for customers to buy and insure a car. Allstate finished a pilot program that opened agencies in 11 dealerships across the country during the past two years. The pilot program was successful, and now Allstate is expanding the model to other dealerships like Love Chevrolet. Instead, buy with discounts, directly and save:

Wall Street gurus crash and burn—but still make $ millions by avoiding taxes
Hot hands attract hot money from wealthy, take 2% and 20% of gains, become rich and lazy, hot money leaves to find another hot hand. The pattern is typical “bubble” creation so real long-term investors have stayed away. Those who stay at the party too long, regret it. Our working person’s pension money is usually the last to leave. Thus one of the largest “bubbles” is down 8% in 2013 while their neighbor’s 500 index fund is up 20%. Meanwhile, Congress still gives the “bubble” people a tax break and we pay for it. Gurus can’t make you rich:

401k use is up—average savings rate is over 10%
A survey of American workers cite "saving enough for retirement" as their greatest financial concern – but men are paying more attention and taking more positive action, but women live longer. Participants in general are saving more, with the average retirement savings rate among those surveyed at 10.5%, up from 9% two years ago. Satisfaction with information from retirement plan sponsors is down sharply (10% in 2013 vs. 30% two years ago). Men are more likely to have a professional advisor and are more confident than women in virtually every aspect of retirement planning and defined contribution investment decisions. Ensure Your Financial Health with Wealth: A Woman's Guide to a $2,000,000 Tax-FREE Wealth Reserve

Is critical illness insurance right for you?
Prudential has just entered the employer market. These policies say they cover major illness like heart attack, cancer, organ transplant, renal failure, stroke and coronary artery bypass surgery. But employees are already covered for all of these causes in their comprehensive health care policy. Pru says health coverage does not pay for expenses like transportation and day care. These policies pay “a flat dollar amount, which can be used for anything and provides an “easy and convenient” way to keep extra protection in place,” Pru said.
These kinds of policies are just an expensive savings account that pays you less. You are better off using your own car and family for these expenses and using the money to buy a real health policy. Renal failure and cancer treatments cost much more than any “flat dollar amount” from these policies. Skip it:

Almost one-fourth of U.S. drivers feel they’ve come close to causing an accident while using their cell phone while driving, according to a new survey.

Allstate cutting benefits to employees to raise stock price
It named cost-cutting as one of its top priorities for 2013, and is reducing some retirement and life insurance benefits in a move that it says will boost its book value per share to $2. The changes include a new formula to calculate pensions, as well as ending retiree life insurance benefits for current employees.
America has more than 44 million workers (27,500 private-sector pension) that are now receiving reduced checks from the government because their employers cancelled their pensions. Make your own:

Employees pick less-expensive high-deductible health plans
Liazon survey says that when given the choice between a conventional employer-sponsored health plan and a less-expensive high-deductible or preferred network plan, 60% of employees chose the lower-priced plans. "HSA plans encourage individuals to take an active role in their health care decisions while stretching their health care dollars." Buy only what you need:

You don’t get what you pay for—even for the “professionals”
State pension plans that pay higher fees don't get better returns for their employee plans.  According to a BenefitsPro, "The 10 states paying the highest fees - a median rate of 0.61% - posted annualized five-year returns of 1.34%.  In comparison, the 10 lowest-paying states paid a median rate of only 0.22% and garnered 2.38% returns." If pension funds would just stick low-cost index funds, they would have returns of 7% for 5 years. Don’t pay for what “professionals” can’t deliver:

New York health exchanges offer 50% drop in premiums
Health insurance premiums will drop by about 50% on average for consumers in New York who buy new plans through a state-run marketplace created by the Affordable Care Act. The state approved plans to be sold by 17 insurers, including UnitedHealth Group and WellPoint, the industry’s two biggest carriers, according to a statement today by New York Governor Andrew Cuomo. The lowered rates mean that starting Oct. 1, a New York City resident who now pays at least $1,000 a month for insurance will be able to buy coverage for as little as $308, according to rates posted by governor’s office.

Why is your LPL Financial advisor raising your fees?
Your broker or advisor who uses LPL will be hit with new fees because of the way the firm is regulated. They can pass the costs on to you. You can leave and move your assets to a low-cost firm like Schwab, Fidelity or Vanguard. Try doing it yourself. All these firms have licensed advisors on salary who pass on economies of scale to you:

SCAMS           “Deficits don’t matter” Republican godfather, Dick Cheney, 2002

When hell freezes over?
4 senators want Wall Street banks to separate their 'high-stakes gambling' units from your savings and checking. Banks don’t want to give up your ‘cheap’ deposits. The bill sponsored by Senators Elizabeth Warren, John McCain, Maria Cantwell, and Angus King would separate traditional banks that offer checking and savings accounts insured by the Federal Deposit Insurance Corp. from “riskier financial institutions.” The latter category includes companies involved in investment banking, insurance, swaps dealing, hedge funds and private equity, according to the lawmakers' statement released yesterday. Some former bankers support the bill but previous attempts have failed. No current bank lobbyists are for it, so it has no chance to pass even the Senate.

Follow the Money host in jail
Patrick Kiley's radio voice was softened after being convicted of scamming hundreds of people who were victimized in the Ponzi scheme. He hosted "Follow the Money," broadcast on many Christian radio channels.

Senators pretend to be outraged by high gas prices
Lawmakers grilled representatives of oil producers and refiners seeking an explanation for a rise in gasoline prices at the pump amid a boom in U.S. oil production. Remember when we were told there was low supply so prices were high. Guess what, now the oil companies send the oil to places where the prices are higher so we all pay more anytime the oil companies want to raise profits. It is called monopoly capitalism and the Senators benefit in their dividend accounts. Laughs on us.

Credit bureau that has notorious errors in data, to verify income for ObamaCare
Equifax will be paid $ millions to verify incomes of people who apply for federal subsidies to buy health insurance. Regulators will never fix the way bureaus keep reselling their errors no matter what you do.  

Two Americas
Planned Parenthood informed staff at three of its facilities in Texas that they would be closing. Out of the three Planned Parenthood clinics that are closing, only the Bryan clinic performs abortions. “In recent years, Texas politicians have created an increasingly hostile environment for providers of reproductive health care in underserved communities. Texans with little or no access to health care services have been deeply affected by state budget cuts to programs provided by Planned Parenthood health centers and dozens of others that provided lifesaving cancer screenings, well-woman exams and birth control," said a spokeswoman.

Who owns your account now?
Lincoln Benefit Life to Resolution Life (GB)
Allstate will discontinue issuing fixed annuities and its agents will sell other products.

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