Thursday, December 27th, 2012 | | |
It’s the time of the year when a lot of people pack up their car with family and hit the road to visit relatives. It’s also deer collision time, with many of those incidents ending with deadly results for drivers and passengers. That makes deer one of the most dangerous animals in North America, according to an article by Doyle Rice of USA TODAY.
The article tells the story of an extended family of 10 that was traveling from Chicago to New Jersey when their minivan hit a deer on the Indiana Toll Road. When they stopped or slowed, they were then hit by a semi going 65 mph. Three adults and four children died in the crash, while three others were hospitalized.
The article goes on to say that according to the National Highway Traffic Safety Administration, there are about 1 million car accidents with deer each year that kill 200 Americans, cause more than 10,000 personal injuries, and result in $1 billion in vehicle damage. West Virginia tops the list of states where a driver is most likely to run into a deer, State Farm reports. The other states in the top 10 are Iowa, South Dakota, Pennsylvania, Michigan, Montana, Wisconsin, Minnesota, North Dakota and Wyoming.
What does all this have to do with insurance? Just think what position you or your family would be in if you were involved in an incident like the one described above and you had no life, disability or long-term care insurance? You insure your car. Shouldn’t you insure your most valuable asset, your life?
Thursday, December 20th, 2012 | | |
The article, How to Slice Up Your Charitable Pie, by The New York Times columnist Ron Lieber got me thinking about charitable giving. I’ve always opened my checkbook in an ad hoc manner throughout the year when events or causes that have meaning to me occur, like Race for the Cure.
But something that Lieber wrote got me thinking, “Many of us would not be where we are were it not for the educational institutions that picked up the bill when we could not pay full freight. To my mind, that creates not just a debt of gratitude but a running tab that I hope to clear long before I die.”
That is certainly true in my case. And I think there are very few of us who could say otherwise. But does the University of Wisconsin-Madison really need my check? I suppose my friend in its development office would say yes. But this year I’m going to start paying that “running tab” by donating to the LIFE Lessons Scholarship Program.
This program helps young adults who’ve lost a parent and who are in tight (sometimes desperate) financial straits pay for school. I think back and my struggle might have been meeting the tuition bill, but theirs also includes moving on after losing a parent, and often becoming a parent to other siblings, like Brittney LaCombe.
Brittney is amazing. She’s raising her two teenage sisters while getting her degree in social work. You can watch her moving story here. As she says, “I work full-time, go to school full-time and take care of my sisters full-time.” That’s not a life most 20-year-olds imagine for themselves.
That’s why I just donated online to the LIFE Lessons’ Scholarship Fund. And I ask that everyone who reads this donate—whatever they can—as well. Pass this donation link on (www.lifehappens.org/donate-to-life-lessons) and let’s help Brittney and other young adults like her realize their dream of getting a college education.
Tuesday, December 18th, 2012 | | |
The holiday season is always special; it’s a time when we gather with friends and family to celebrate longstanding traditions and find time to make new ones. Holiday visits can also be an excellent opportunity to talk to your aging parents and family members about their potential long-term care needs.
But where do you start? Your overall goal should be to host an honest conversation about their current health situation. Here are a few questions to keep in mind:
Evaluate their ability to live independently
- Do they struggle to get dressed or use the restroom without help?
- Are they able to lend a hand in the kitchen or adequately feed themselves during dinner?
- Can they get around their house safely or does the home present any safety issues?
- Are they struggling with other everyday tasks?
Consider their overall health
- How are they feeling?
- Have they had any recent doctor visits or checkups they are willing to discuss?
- Have they noticeably lost weight and are they maintaining their personal health?
Observe their emotional and mental state
- Do they have a positive attitude or do they frequently require encouragement to accomplish ordinary tasks?
- Are they still participating in their usual activities and hobbies?
- Are periodic memory lapses, such as forgetting names of relatives or household items, disrupting their lives?
- Do they repeatedly ask the same questions?
You can also test their memory during holiday visits by asking about notable dates or events, or by giving them a couple key words to remember and asking them to repeat the words throughout your visit.
Phone calls and emails are a great way to regularly check in on aging parents and loved ones, but holiday visits can be a valuable opportunity to get a clear picture of their well-being. As you catch up on the year’s events and relive old memories at your holiday gatherings this year, spend some time considering your family’s future as well. It may turn out to be the right time to take the first step toward long-term care planning and discussing how solutions like long-term care insurance can help preserve their independence and ensure their needs are met.
Friday, December 14th, 2012 | | |
CPA, JD, MSFS, MSM, CLU, ChFC, CFP, RFC, CFA, ChHC, RHU, FSS, RICP, CASL, CAP, REBC RIA and the list goes on. It’s no wonder you (and me) are confused. So, what designation should you look for when looking to work with an agent or professional advisor? It all depends on what you are looking to accomplish.
Let’s review some of the more commonly recognized designations.
CLU – Chartered Life Underwriter: If you are dealing with life insurance and related products such as long-term care insurance, disability insurance or annuities, this is the one to look for. A CLU has completed a series of eight college-level courses requiring 16 hours of exams covering topics such as risk management and estate planning. A CLU is an insurance specialist.
CFP – Certified Financial Planner: This specialist is trained in comprehensive financial planning, which requires a series of seven exams.
ChFC – Chartered Financial Consultant: This is similar to a CFP with training in overall financial planning. This designation requires the same course work as the CFP plus two electives such as executive compensation or macroeconomics.
LUTCF– Life Underwriter Training Council Fellow: This certification, which requires the completion of six courses, combines essential product knowledge with basic planning concepts.
RHU – Registered Health Underwriter: The RHU requires the completion of four courses on group and individual health insurance. This designation is the premier credential in the health insurance market. If you have questions about health insurance, the RHU is the professional with the expertise.
If you would like to learn more about these and other professional designations, go to The American College.
If you are looking for an agent or advisor to help you, you can start here, with LIFE’s Agent Locator. Everyone listed is a member of their professional organization, the National Association of Insurance and Financial Advisors.
Tuesday, December 11th, 2012 | | |
As with much of the economy—the talk of fiscal cliffs and all—there is uncertainly about taxation in 2013. I wanted to let you know about a planning strategy before time runs out.
The marital deduction (IRC Sections 2056 and 2523) eliminates both the federal estate and gift tax on transfers of property between a husband and wife, in effect treating them as one economic unit. The amount of property that can be transferred between them is unlimited, meaning that a spouse can transfer all of his or her property to the other spouse, during lifetime or at death, and completely escape any federal estate or gift tax on this first transfer. However, property transferred in excess of the unified credit equivalent will ultimately be subject to estate tax in the estate of the surviving spouse.
Through use of the unlimited marital deduction, a married couple’s combined assets are untouched by federal estate tax, meaning that the full amount is available for the surviving spouse’s support and maintenance after the first spouse’s death. At the surviving spouse’s death, the marital deduction may not be available, meaning that the full value of the surviving spouse’s remaining estate will be exposed to federal estate taxation.
The 2010 Tax Relief Act, however, provides for “portability” of the maximum estate tax unified credit between spouses. This means that a surviving spouse can elect to take advantage of any unused portion of the estate tax unified credit of a spouse who dies in 2011 or 2012 (the equivalent of $5 million in 2011). As a result, with this election and careful estate planning, married couples can effectively shield up to $10 million from the federal estate and gift tax without use of marital deduction planning techniques, but only if one of the spouses dies in 2011 or 2012. Property transferred in excess of the combined $10 million unified credit equivalent will be subject to estate tax in the estate of the surviving spouse. (You may want to consider life insurance to pay the tax bill due when the spouse dies.)
If the surviving spouse is predeceased by more than one spouse, the additional exclusion amount available for use by the surviving spouse is equal to the lesser of $5 million or the unused exclusion of the last deceased spouse.
IMPORTANT NOTE: Since the 2010 Tax Relief Act “sunsets” at the end of 2012, portability of the unified credit exemption between spouses will not be available beginning in 2013 unless Congress takes action in the future.
If you’d like more information on how to make best use of the marital deduction, please contact your agent or financial advisor.
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