Hiring a public insurance adjuster can help to make the insurance claims process go more smoothly and help to ease the stress homeowners are facing in the aftermath of a hurricane.

What Is a Public Insurance Adjuster?

A public insurance adjuster is a third-party representative who works on behalf of the insured. Homeowners, for example, can hire a public insurance adjuster to handle their insurance claims. The public insurance adjuster would then work on behalf of the homeowner and all of their services would be paid for by the homeowner as well. The payment, however, is contingent upon winning a claim as it is a percentage of whatever the adjustor can get from the insurance company for you.

How Is a Public Insurance Adjuster Different from an Independent Insurance Adjuster?

A public insurance adjuster and an independent insurance adjuster are similar in that they both are third-party representatives who aren’t employed directly either by the homeowner or by the insurance company. Instead, they’re hired by either party to outsource part or all of the claims filing process.

A public insurance adjuster works on behalf of the homeowner or other insured party while an independent insurance adjuster works on behalf of the insurance company.

What Is an Independent Insurance Adjuster?

When you file a claim with your insurance company, an insurance adjuster has to come out and do an assessment of the damage to determine how much the insurance company is liable for. After an event like a hurricane, an insurance company might not have enough of its own insurance adjusters on staff to process all of the claims coming in. They would thus hire independent insurance adjusters to handle some of these claims.

Can a Public Insurance Adjuster Also Be an Independent Insurance Adjuster?

One person could be licensed as both a public insurance adjuster and an independent insurance adjuster. However, they cannot act as both on the same claim.

How Does a Public Insurance Adjuster Help Homeowners?

A public insurance adjuster can help homeowners to file a claim properly with insurance companies and who can help policy holders to settle their insurance claims. They may be more knowledgeable about the insurance claims process and can help homeowners to get more money from their insurance companies by advocating on their behalf.

How Much Money Can a Public Insurance Adjuster Get for You?

A public insurance adjuster cannot get you more money than what is specified in your insurance policy. However, they can help you to get more of what’s allowed in your policy than the insurance company is initially willing to pay out.

How Much Does a Public Insurance Adjuster Cost?

Typically, a public insurance adjuster can charge a fee of up to 20% of your settlement from your insurance company. Because it’s percentage-based, the public insurance adjuster’s pay depends on how much they’re able to help you get from your insurance company.

Do Fees Change During a Disaster?

The percentage may change during a disaster like a hurricane. In Florida, the standard fee a public insurance adjuster can charge is 20%, but this is lowered to 10% after a state of emergency is declared. That lower rate continues for that particular claim for up to a year following the filing of that claim.

How Do I Find a Public Claims Adjuster?

If you’re going to hire a public insurance adjuster, you’ll want to make sure you’re hiring one that is trustworthy and who is fully qualified to help you.

Find a Public Claims Adjuster

One way to find a public claims adjuster is to ask your friends and family if they’ve got any recommendations. If they don’t know anyone, another option is to search online. You can search for businesses and professionals in almost any industry at the Better Business Bureau. You can also look at the National Association of Public Service Adjusters website, which allows you to search for a public adjuster by state.

Check for Licensing and Qualifications

Before you hire anyone, make sure to check for their qualifications. You’ll need to make sure that they’re licensed to practice in Florida. Additionally, you can check with the Better Business Bureau to look at the adjuster’s track record.

Know What to Avoid

If a public insurance adjuster is pressuring you to sign a contract before you’ve fully read and understood it, you should look elsewhere. Similarly, it’s a good idea to avoid an adjuster who goes door-to-door following a storm. Typically, reputable adjusters are too busy processing and handling claims to seek out new clients by knocking on doors.

It’s also a good idea to make sure that your public insurance adjuster doesn’t have a pre-existing relationship with your insurance company if they’re licensed as both a public and an independent insurance adjuster.

Questions to Ask a Public Insurance Adjuster Before Hiring

1. Are you licensed in the state of Florida?
2. Will you personally handle my claim?
3. How many other claims in my area are you handling?
4. How long have you been practicing as a public insurance adjuster?
5. Can you provide references from previous clients?
6. Can I still communicate with the insurance company’s claims adjuster if I hire you?
7. How much would I owe you if I decided to end the contract early?
8. What is your fee?
9. Will you work with a specific attorney or law firm?

How to File a Claim with Your Insurance Company

Some public insurance adjusters can help you with the entire process of filing the claim in addition to handling claims that have already been filed. Whether you’d prefer to file your claim yourself and bring in a public insurance adjuster afterward to handle the claim or have the public insurance adjusters help with the filing process, you’ll need to do the following things:

Gather Your Insurance Information

You’ll need the following information:

• The name of the insurance policy holder
• The address of the home listed on the insurance policy
• The contact phone number for the policyholder
• The contact email address for the policyholder
• The name of the insurance company
• The name of your insurance company representative, if you have one
• The insurance policy number

Document the Damage

The more details you can gather, including photographic evidence, of the damage that occurred, the better. Thoroughly inspect your property before calling your insurance company and make sure that you document everything. After a hurricane, that will be a lot and could take some time, but it’s important to be able to prove the full extent of the damage to get as much from your insurance policy as possible.

Report Damage Repaired

If you had to start repairing some of the damage because it was dangerous, make a note of that. Take pictures of both before and after so that it’s noted for your claim, but if there’s an emergency situation, make sure to do what’s necessary to handle it. If you have to call the police, an ambulance, or the fire department, also make a note of that and keep a copy of your report.

What Does My Insurance Policy Cover?

A public insurance adjuster can help you to recover more money than you might be able to on your own, but they can’t get you money for anything beyond what’s actually in your policy. You can, however, ask your adjuster to help you understand your policy and make sure you know exactly what’s covered.

What Is Hurricane Insurance?

Depending on your insurance company, hurricane damage may be covered by your homeowners’ insurance policy and doesn’t necessarily need a separate policy. However, there may still be a separate deductible for hurricane damage on top of your regular deductible.

What Is Flood Insurance?

A homeowners insurance policy or a hurricane insurance policy may cover damage from wind or rain, but may not include coverage for damage due to floods. If you live in an area of Florida that is at high risk of flooding during a hurricane, you may need to have a separate flood insurance policy. However, many people unfortunately don’t maintain one because flood insurance can be costly.

What Resources Are There to Help After the Hurricane?

If you don’t have flood insurance or your insurance policy doesn’t cover floods, you’re not completely out of luck. Fortunately, there are resources offered by the government to help with disaster relief.

FEMA

FEMA stands for the Federal Emergency Management Agency and it’s the government organization that handles disaster recovery. Hurricanes generally fall within the purview of FEMA and they have resources to help individuals as well as wider recovery efforts.

Flood Insurance

FEMA offers flood insurance policies with the National Flood Insurance Program. If you already have a policy with NFIP, you can file a claim there. If you don’t, it may be a good idea to look into opening a policy for the future.

Disaster Assistance

You can apply for disaster assistance with FEMA at DisasterAssistance.gov. If you need assistance after Hurricane Ian, you can apply here: https://www.fema.gov/disaster/4673. This site provides state, local, and national resources that you can access for help and information about how to apply for assistance.

If you’d like to connect with a financial advisor in this process, click here to talk to an AllGen Financial Advisor!

Important Disclosures: The information provided here is of a general nature and is not intended to answer any individual’s financial questions. Do not rely on information presented herein to address your individual financial concerns. Your receipt of information from this material does not create a client relationship and the financial privileges inherent therein. If you have a financial question, you should consult an experienced financial advisor. Moreover, the hiring of a financial advisor is an important decision that should not be based solely upon blogs, articles, or advertisements. Before you hire a financial advisor, you should request information about the financial advisor’s qualifications and experiences. Past performance is no guarantee of future results. All expressions of opinion are subject to change without notice in reaction to shifting market conditions. Data contained herein from third party providers is obtained from what are considered reliable sources. However, its accuracy, completeness or reliability cannot be guaranteed. Examples provided are for illustrative (or “informational”) purposes only and not intended to be reflective of results you can expect to achieve. AllGen Financial Advisors, Inc. (AllGen) is an investment advisor registered with the SEC. AllGen does not provide personal financial advice via this material. The purpose of this material is limited to the dissemination of general information regarding the services offered by AllGen. The Disclosure Brochure, Form ADV Part II, which details business practices, services offered, and related fees of AllGen, is available upon request.​

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An estate plan is a method for prescribing your wishes in the event of your death or incapacitation. A proper estate plan includes the following:

1. Will/Trust – Communicates your wishes for how assets should be transferred after your death, designates a guardian for your children, and names an executor of your estate, among other functions
2. Durable Power of Attorney – Designates who makes financial decisions on your behalf
3. Healthcare Surrogate – Designates who makes health care decisions on your behalf
4. Living Will – makes wishes known regarding life prolonging treatments

Read through this post on estate planning here, or skip to our AllGen Academy estate planning video below.

Why Is an Estate Plan Important?

Since death is not a pleasant topic of conversation for most people, this area of planning is often ignored. However, estate planning is critical for facilitating the lives of your loved ones in the case of your death, serious injury, or illness.

For example, you may become disabled and mentally incapable of fulfilling certain responsibilities such as paying your bills, determining which medications to take, or deciding whether to have the doctor perform surgery. No one can legally do these for you unless you have established estate planning documents that give certain “powers” for someone else to act on your behalf.

Similarly, you can structure your estate plan to provide for the care of your children according to your wishes if something happens to you and/or your spouse. Failing to have a plan in place means it’s up to the court system to determine who cares for your children in your absence.

How to Establish an Estate Plan

When it comes to estate planning, we recommend you pay an attorney to help you navigate this process instead of attempting to do it yourself. There is a lot of legal language used in an estate plan and misstating just one clause can lead to your plan being disqualified. While there are online resources to do this yourself, depending on the complexity of your estate or wishes, estate documents sometimes need to be state specific and more involved than what a generic online form can provide.

It’s important to choose an attorney who is well versed in estate planning rather than a generalist or someone specializing in a different area of law. Not all lawyers are created equal and the depth of law requires specialization in this specific area.

How Does Estate Planning Protect My Family?

Estate planning adds an extra layer of control and management in your financial life in the face of permanent injury or death. It allows you to protect and continue your legacy while limiting the intervention of attorneys, courts and expensive fees at a later date. Whether your estate is simple or complex, these documents can assist your loved ones during a difficult time.

For more information on estate planning, watch our AllGen Academy video below.

Important Disclosures: The information provided here is of a general nature and is not intended to answer any individual’s financial questions. Do not rely on information presented herein to address your individual financial concerns. Your receipt of information from this material does not create a client relationship and the financial privileges inherent therein. If you have a financial question, you should consult an experienced financial advisor. Moreover, the hiring of a financial advisor is an important decision that should not be based solely upon blogs, articles, or advertisements. Before you hire a financial advisor, you should request information about the financial advisor’s qualifications and experiences. Past performance is no guarantee of future results. All expressions of opinion are subject to change without notice in reaction to shifting market conditions. Data contained herein from third party providers is obtained from what are considered reliable sources. However, its accuracy, completeness or reliability cannot be guaranteed. Examples provided are for illustrative (or “informational”) purposes only and not intended to be reflective of results you can expect to achieve. AllGen Financial Advisors, Inc. (AllGen) is an investment advisor registered with the SEC. AllGen does not provide personal financial advice via this material. The purpose of this material is limited to the dissemination of general information regarding the services offered by AllGen. The Disclosure Brochure, Form ADV Part II, which details business practices, services offered, and related fees of AllGen, is available upon request.​

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Many people are considering relocating for financial reasons. Their strategy is to move somewhere with a lower cost of living while maintaining a paycheck that reflects a more expensive city, like New York City or Chicago.

Orlando and the surrounding Central Florida area have become a popular option for financial and tax reasons. But with the entire country to choose from, people are especially drawn to Orlando for its beautiful weather and the year-round outdoor activities Central Florida has to offer. In addition to the beautiful weather, Orlando is known worldwide for its premier theme park attractions, including Walt Disney World and Universal Studios.

So now that you’ve decided to move to Orlando, what do you need to do?

To Buy or To Rent?

One of the biggest decisions that needs to be made when moving to a new location is whether to rent or own. There are pros and cons to consider on both sides.

Timing and Finances

For some, renting makes more sense than owning. For others, buying a home is the right thing to do. Regardless, you may want to consider renting first. Renting gives you the ability to become familiar with your new surroundings – without the long-term commitment of buying. After renting, you might decide that you prefer to live in a different neighborhood or area of town.

There is also a significant financial difference between the two. Renting requires smaller upfront expenses than the down payment and closing costs associated with purchasing a home. Additionally, most repairs and maintenance items are eliminated as that is the responsibility of the landlord.

If you’re moving from a higher cost of living area to Orlando, then by selling your home in your current city, you’ll likely be well-positioned to buy a home in Central Florida. However, market conditions are also an important factor to consider when deciding to buy or rent.

Renting literally “buys” time to do your due diligence and get a better feel of the area before making a very important, more permanent decision.

Additional Resources

It’s a good idea to talk to a local real estate professional as well as discuss such a major purchase like this with a fiduciary financial advisor so you can determine your optimal budget to keep you on your Path to Financial Freedom.

Check out Zillow or Realtor for home listings, which includes both rental properties and those available for purchase.

Purchase Home Owner’s or Renter’s Insurance

As soon as you’ve signed the contract for your new house, you should start shopping around for homeowners’ insurance. Depending on where you live, a standard homeowners’ insurance policy may not cover certain weather events like hurricanes or floods. In fact, in some areas of Florida, purchasing extra insurance packages to cover floods and hurricanes may be required.

Renter’s insurance covers your personal belongings rather than the property itself. This means that your renter’s insurance should cover any damage to your belongings that may occur during a hurricane as well as the cost of having to make alternative living arrangements if your home is damaged and temporarily unlivable. Renter’s insurance won’t cover any damage to the property itself, but that’s because property damage should be covered by the landlord’s homeowner’s insurance.

Set Up Utilities

Before you actually move into your home, you’ll want to set up utilities so it’s ready as soon as you arrive. These include gas, water, electricity, and (because it’s 2021) the Internet. You’ll want to do this several weeks before you actually move in so that you can ensure everything is turned on and working ahead of time.

These may be some helpful resources:
https://www.duke-energy.com/Home
https://www.ouc.com/residential
https://www.orlando.gov/Trash-Recycling
https://www.orangecountyfl.net/WaterGarbageRecycling/GreenClean.aspx#.YRQruohKhPY
https://www.seminolecountyfl.gov/departments-services/environmental-services/solid-waste-management/
https://www.orangecountyfl.net/watergarbagerecycling/waterservice.aspx#.YRQsIIhKhPY
https://www.seminolecountyfl.gov/departments-services/environmental-services/customer-service/
https://www.spectrum.com/internet-service/florida/orlando
https://www.centurylink.com/local/fl/orlando
https://www.att.com/local/internet/florida/orlando

Change Your Driver’s License

Once you’ve moved into your new home, you’ll need to start the process of changing your address. The first step is to make sure that official mail is coming to your new address. This will allow you to use mail as proof of address when you go to the DMV to change your driver’s license. Bills from the utilities you recently set up are typically good options.

Find a Financial Advisor

Regardless of whether you have a financial advisor already, it’s important to establish a relationship with a local fiduciary advisor in advance of moving to your new home. An Orlando financial advisor can help you to understand various nuances like the tax implications of your move. Taxes vary from state to state and even from city to city, so it’s important to find an experienced advisor.

In the event that you need more help, an Orlando financial advisor can also help you find a trusted source for legal advice, home buying, and a local CPA.

If you have questions or concerns, you can contact us at any time.

We’re here to serve. 407-210-3888

Important Disclosures: The information provided here is of a general nature and is not intended to answer any individual’s financial questions. Do not rely on information presented herein to address your individual financial concerns. Your receipt of information from this material does not create a client relationship and the financial privileges inherent therein. If you have a financial question, you should consult an experienced financial advisor. Moreover, the hiring of a financial advisor is an important decision that should not be based solely upon blogs, articles, or advertisements. Before you hire a financial advisor, you should request information about the financial advisor’s qualifications and experiences. Past performance is no guarantee of future results. All expressions of opinion are subject to change without notice in reaction to shifting market conditions. Data contained herein from third party providers is obtained from what are considered reliable sources. However, its accuracy, completeness or reliability cannot be guaranteed. Examples provided are for illustrative (or “informational”) purposes only and not intended to be reflective of results you can expect to achieve. AllGen Financial Advisors, Inc. (AllGen) is an investment advisor registered with the SEC. AllGen does not provide personal financial advice via this material. The purpose of this material is limited to the dissemination of general information regarding the services offered by AllGen. The Disclosure Brochure, Form ADV Part II, which details business practices, services offered, and related fees of AllGen, is available upon request.​

The post What to Do When You’re Relocating to Orlando appeared first on AllGen Financial Advisors, Inc..

If you’re feeling unsure about what to do on your Path to Financial Freedom, be sure to speak with your AllGen Advisor.

Don’t let current conditions keep you up at night. Obsessing over the market is what we do! 

Give us a call if you have any questions. We’re here to serve.

407-210-3888

Important Disclosures: The information provided here is of a general nature and is not intended to answer any individual’s financial questions. Do not rely on information presented herein to address your individual financial concerns. Your receipt of information from this material does not create a client relationship and the financial privileges inherent therein. If you have a financial question, you should consult an experienced financial advisor. Moreover, the hiring of a financial advisor is an important decision that should not be based solely upon blogs, articles, or advertisements. Before you hire a financial advisor, you should request information about the financial advisor’s qualifications and experiences. Past performance is no guarantee of future results. All expressions of opinion are subject to change without notice in reaction to shifting market conditions. Data contained herein from third party providers is obtained from what are considered reliable sources. However, its accuracy, completeness or reliability cannot be guaranteed. Examples provided are for illustrative (or “informational”) purposes only and not intended to be reflective of results you can expect to achieve. AllGen Financial Advisors, Inc. (AllGen) is an investment advisor registered with the SEC. AllGen does not provide personal financial advice via this material. The purpose of this material is limited to the dissemination of general information regarding the services offered by AllGen. The Disclosure Brochure, Form ADV Part II, which details business practices, services offered, and related fees of AllGen, is available upon request.​

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We entered the year expecting changes due to political and social movement. And while many may say that the anticipated changes have not yet fully manifested themselves, we have witnessed change at Allgen. Among these changes, we have wished Cassy Morrison farewell in her new endeavors as she and her husband relocated to Virginia. While we are sad to see her go, we are excited about the opportunity offered to her husband and wish them well in this new chapter of their lives. With Cassy leaving, we also welcome 3 newcomers to the team. Please help us welcome Karen Vergara, Robert Cortes and Liz Castro. Stay tuned for our upcoming newsletter as we further introduce them so that you may get to know them better.

Another change has been the allocation within our portfolio models. As markets have played out according to our previous comments, we have started making adjustments reflecting such change. We’ll elaborate upon this in the market commentary.

As we continue to promote Allgen’s path to financial freedom, we return to one of the fundamental building blocks of the foundation stage: Simple Will. Yes, we know it is not usually the topic of choice and yet we see so many people come to our office without a will. As such, many come to us with either no will or one that needs to be updated. It is critical that you get this part of your foundation correct. We start to address this issue in our financial planning update.

And finally, as always, we welcome the opportunity to chat with you about your portfolio and your path to financial freedom. Please feel free to contact our office to schedule a review or ask a question. It is our pleasure to serve you!

Simple Will

“In this world, nothing can be said to be certain, except death and taxes.” – Benjamin Franklin

Despite the certainty of death, approximately 55% of American adults do not have a will or other estate plan in place, according to LexisNexis. And this is significantly higher among minorities: 68% African American adults and 74% Hispanics adults. Granted, talking about death is no fun. Yet, death often comes as an unpleasant surprise leaving loved ones grieving and stressing over what to do now and going forward. Having a valid will facilitates the process of distributing assets per your wishes and addresses many questions that arise after death.

What If I Die without a Will?

This is referred to as “dying intestate” and your resident state has a default plan for you. Florida’s intestate plan¹ may not align with your plan for whom you would choose to raise your minor children, manage any assets for your children, who may distribute your assets and who gets any items of sentimental value. Moreover, your state is not aware of the family dynamics — functional or dysfunctional as they may be.

Simple vs Complex Wills²

A simple will is generally suitable for:
• Adults 18 – 50
• There are few assets and the estate is not subject to the estate tax³
• There are no children from previous marriages/partners
• You don’t expect anyone to contest your will due to fraud, duress, or lack of mental competency.

If any of the above apply, you may want to speak with an attorney about options that cover more complex topics (ex: Trusts).

What Makes a Will Valid in Florida?

• You must be of sound mind and at least 18-years old
• It must be in writing
• You must have two witnesses to your signature
• And it is advantageous to have your signature along with your two witnesses’ signatures signed before a notary.

What about Estate Planning while I’m Still Alive?

A comprehensive estate plan does not stop with a will. It usually includes the following documents when you are alive but unable to handle or voice your wishes due to an accident, illness, or cognitive impairment.

1) Living Will “advance directives” – addresses life prolonging medical treatments including a do not resuscitate (DNR) order.
2) Healthcare Surrogate – designates who can make health care decisions on your behalf
3) HIPAA – designates who can have access to your medical information
4) Durable Power of Attorney – designates who manages your financial affairs and makes financial decisions on your behalf
5) Pre-need Guardian – the person you want to serve as your guardian of self and property in the event of your incapacity.

It is wise to have your financial plan coordinated with your estate plan and vice versa. We encourage you to obtain a will if you don’t have one. If you have a will it’s important to review it if your life circumstances change (i.e. marital status) or if you haven’t done so in the last 5 or 6 years. Laws change and you want your estate plan to be up to date. Since these are legal documents, we recommend that your documents be drafted by an attorney. Contact your Allgen advisor if you would like to identify an attorney for your needs.

Summary

We look forward to assisting you with any questions you may have. We also invite you to stay connected with Allgen’s market viewpoints and financial education. Our weekly “Money Minute” video series answers your financial questions, and it helps guide you on your path to financial freedom. You can find us via www.allgenfinancial.com, Facebook, LinkedIn, Twitter, and YouTube.

¹ Florida Statutes Title XLII Chapter 732 Probate Code: Intestate succession and wills.
² It is strongly recommended to consult with an estate planning attorney regarding your specific needs and wishes and provide the estate planning attorney as much information.
³ For 2017, an individual can leave $5.49 million to heirs and pay no federal estate or federal gift tax.

Written By: Paul Roldan, Chief Executive Officer Allgen Financial Advisors, Inc.; Ana Fernandez, CFP® and Teresa Talton, CFP®

Important Disclosures: The information provided here is of a general nature and is not intended to answer any individual’s financial questions. Do not rely on information presented herein to address your individual financial concerns. Your receipt of information from this material does not create a client relationship and the financial privileges inherent therein. If you have a financial question, you should consult an experienced financial advisor. Moreover, the hiring of a financial advisor is an important decision that should not be based solely upon blogs, articles, or advertisements. Before you hire a financial advisor, you should request information about the financial advisor’s qualifications and experiences. Past performance is no guarantee of future results. All expressions of opinion are subject to change without notice in reaction to shifting market conditions. Data contained herein from third party providers is obtained from what are considered reliable sources. However, its accuracy, completeness or reliability cannot be guaranteed. Examples provided are for illustrative (or “informational”) purposes only and not intended to be reflective of results you can expect to achieve. Allgen Financial Advisors, Inc. (“Allgen”) is an investment advisor registered with the SEC. Allgen does not provide personal financial advice via this material. The purpose of this material is limited to the dissemination of general information regarding the services offered by Allgen. It is not intended to be a solicitation or offer to sell investment advisory services to residents of any state in which Allgen is not currently authorized to do so. The Disclosure Brochure, Form ADV Part II, which details the business practices, services offered, and related fees of Allgen, is available upon request.

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I wanted to take a few minutes and talk about something that I think is really pressing amongst the millennial generation: the ‘living for the now’ mindset.

While I think Gen Y has a lot to be recognized for, our financial “savvy-ness” is definitely not one. One of the most unfortunate things I see my fellow millennials doing is living paycheck to paycheck, yet chasing the same lifestyle as their wealthy and successful parents. I can tell you from experience that we will never get to have our desired life style by living from paycheck to paycheck.

My goal with this article is to get our thinking to shift just a little through knowing what you want and rolling up our sleeves to work for it. As a millennial, I know that many eyes (including but not limited to: Gen Z, Gen X, Baby Boomers, Silent Generation, and the media) are watching our every move, and I think we have such a responsibility to our younger generations to teach them how to use our currency wisely.

I want to start by dreaming with you. 

I’ve heard a few Gen Y’s joke about “never being able to retire” and “working until they’re 90.” Funny in the moment, but taking a step back, I don’t want that for you or me! What I would love is for us to start dreaming of what we could have, do, and be. Then, create a plan with our finances to get to that place. Think: “Do I want to continue working because I have to or because I want to.”

So what if you could retire at a decent age of 65? What would that look like? What would you do? What hobby would you take up? Would you golf? Where would you visit? Where would you live? Would your grandchildren come to visit? Would you even have grandchildren? Would they live close? Would you serve in full-time ministry? Would you be able to continue your passion, and not have to worry about finances because you have put enough away? Sounds invigorating, right?!

To be honest, retirement wasn’t really even on my radar until recently. I’m 27 now, and even 1 year ago, like most millennials, I thought: “nah, retirement is just so far away, I don’t need to waste my energy thinking about that now. That will come later.” The reality is that my brain was (and sometimes still is) functioning under that same mindset of ‘living for the now.’ As I’m learning how to adult, I’m finding that truly anything I do must have a strong foundation before it can be successful.

So, let’s talk about building a strong foundation in the financial realm. 

Today, GoBankingRates says that a staggering 72% of surveyed millennials have less than $1,000  saved in their bank accounts. But, if you’re anything like me, that number seemed SO unreachable. I thought it was impossible because the money was going out faster than it was coming in. How would I ever be able to save that amount of money without needing to spend it on something?

In order to win big with our finances and get away from living paycheck to paycheck, let’s start building our foundation. Here are just a few things I’ve learned as I’ve grown more knowledgeable about my finances.

You have to WANT it. You have to be mad enough to make a change.

I think the first step is a heart change. You have to be honest with yourself, be willing to reflect, and be tired of the financial mess. I know if I’m ever going to be wealthy, be able to provide for my family, go on vacations, buy a bigger home, own a Tesla, etc. I’m not going to do it by wasting my money on other things. If I am not managing my own money well, then how will I ever be able to teach my kids and future generations how to manage theirs? Actions speak louder than words. That right there, was enough conviction for me get some help financially.

You HAVE TO, HAVE TO, HAVE TO track your expenses. Know what is coming in and when it’s going out.

Once I got the budget in place, I was able to start setting goals about what I wanted to do with the money I was making. First thing – and the most expensive goal to date – was to get rid of those blood sucking student loans!  My husband and I made a decision and a plan to kick student loan debt in it’s ugly face. The ONLY way we’ve been able to do this is to budget our money and stick to it, no matter what! We have categories budgeted for groceries, gas, car maintenance, home and hygiene, clothes, and yes, even SPENDING! You have to be able to have a little fun here and there so you don’t fizzle out on the journey! The idea here is to allot yourself a certain amount to spend so you’re not overspending.

Once we got a handle on how much was coming in each paycheck, and what we needed to pay, then we were able to put even more money towards our goal. We would highly recommend paying yourself and your categories first before you put extra money elsewhere. This will ensure your foundation remains firm while you are attacking whatever it is that you want to do.

I also thought it important to note that we’ve been in student loan repayment for the past 2 years. We are projected to be done by December of this year. We are planning a celebratory trip to Ireland when we are done to reward all that hard work! There is hope, so don’t give up on  your goals!

Emergency Funds are CRUCIAL!

In order to remain standing on a firm foundation, we needed to stash up money that wasn’t going to take away from what we are trying to accomplish. As we built our emergency fund, I realized that we were going to be okay if my car broke down or if something decided to take a turn for the worse. I found that as we had this emergency fund, less and less things went wrong.

$1,000 is the minimum you should stash away because that will cover quite a few of the small things, and if you empty it out, it won’t take too long to build back up. Please keep in mind that the emergency fund is for EMERGENCIES ONLY! That doesn’t mean an emergency trip to the Bahamas, it also doesn’t mean an emergency trip to taco bell after some late night studying. This is more for if your tire blows out, and you need to replace it; if your have a sudden family emergency in another state, or if you suddenly need to visit the Centra Care due to illness. Other than emergency reasons, your emergency fund is OFF LIMITS!

Student loan debt elimination, credit card debt elimination, car loan debt elimination is all possible! YAY!!!

This is where the “wanting it” comes in. You truly can get out of debt if you put your heart and mind to it. No lie, it is hard work, and it sucks – but you’ll be like Rocky on top of the Philly Museum of Art steps once you are done – it will strengthen you.

Before you even start investing, loans should be paid off first. Here’s why: while you’re investing and making money, you’re also still paying interest on debt. You’re making interest on your investments, but then you are paying that interest on your loans. Anything you net is basically a wash. Really, you’re working hard, but not smart. If you paid off all of your debt, you have a clean slate, and compounding interest will work in your favor while putting away for retirement. This is working smart.

How do you start paying off debt? Check out our “Getting out of Debt” series of Allgen’s #MoneyMinute we filmed a while back. There are some great nuggets of wisdom to help you, starting with the above 3 steps!

Call To Action

Here’s what I want to leave you with:

Like I said before, millennials have many eyes upon them, including younger generations. This means we have a shot at shaping younger generations. I plan to do this in many ways, and one of those ways is with my financial knowledge. Won’t you join me in gaining control of your finances for a much deeper cause than yourself?

Being in the financial industry has taught me SO much, but one of the biggest things is that even though I have picked up life applications here and there, I am no professional. It would have never even crossed my mind for a professional to help me with shaping my financial future once I’m out of debt. Now, I’m highly considering it because I see the value in making my money work for me and my dreams. Maybe something you would consider too?

Along with the above, something I highly recommend doing is checking out Financial Peace University. They have classes everywhere! You can plug right in and take the class with other folks who have a similar mindset. This class has helped instill hope in me where there was none. I am happy to say that I won’t be working out of obligation until I’m 90, but I plan on doing something I love and want to until I’m 90 because my finances are in place!

Thanks for reading!

If you are interested in changing something about your financial picture, we have many great resources on our blog, YouTube, Facebook, Twitter and LinkedIn. If you just plain have questions, we answer those too! 🙂 Give us a call or shoot us an email and we will gladly help!

Written by Cassy Morrison, Marketing Director for Allgen Financial Advisors, Inc.

Important Disclosures: The information provided here is of a general nature and is not intended to answer any individual’s financial questions. Do not rely on information presented herein to address your individual financial concerns. Your receipt of information from this material does not create a client relationship and the financial privileges inherent therein. If you have a financial question, you should consult an experienced financial advisor. Moreover, the hiring of a financial advisor is an important decision that should not be based solely upon blogs, articles, or advertisements. Before you hire a financial advisor, you should request information about the financial advisor’s qualifications and experiences. Past performance is no guarantee of future results. All expressions of opinion are subject to change without notice in reaction to shifting market conditions. Data contained herein from third party providers is obtained from what are considered reliable sources. However, its accuracy, completeness or reliability cannot be guaranteed. Examples provided are for illustrative (or “informational”) purposes only and not intended to be reflective of results you can expect to achieve. Allgen Financial Advisors, Inc. (“Allgen”) is an investment advisor registered with the SEC. Allgen does not provide personal financial advice via this material. The purpose of this material is limited to the dissemination of general information regarding the services offered by Allgen. It is not intended to be a solicitation or offer to sell investment advisory services to residents of any state in which Allgen is not currently authorized to do so. The Disclosure Brochure, Form ADV Part II, which details the business practices, services offered, and related fees of Allgen, is available upon request.

The post Millennials and Finance appeared first on AllGen Financial Advisors, Inc..

Who was this article written for?

Foundation

Formation

Freedom

First, let’s discuss what life insurance is.   

Life insurance provides a payout to beneficiaries of the deceased upon their death. But wait: there is so much more!

At Allgen, we take a look at the individual or family’s whole financial picture, and we guide them on the path to Financial Freedom. One element that is essential to the journey, regardless of life stage, is reviewing life insurance needs.

While life insurance may not be a fun or exciting item to talk about, there are many ways life insurance can improve your financial picture. Here are the top 3 reasons to consider acquiring life insurance for the individual or family:

1. Income replacement – Life insurance can be instrumental in insuring that dependents are financially secure in the event of an unexpected death. For the majority of the population this is the most important consideration.

2. Estate taxes – These are taxes sometimes paid to the state or federal government in the event of death. This only applies to a small percentage of the population as your individual estate has to be worth over $5,490,000 as of 2017. Of those that are, it may be helpful to have a life insurance policy that could pay the tax instead of depleting the estate. This could be especially helpful if the estate is made up of illiquid assets, like a business or real estate.

3. Legacy – Perhaps there hasn’t been time to invest and grow assets. Under that scenario one may still wish to leave a legacy or inheritance to loved ones or an organization dear to one’s heart. Life insurance can assist in making this happen. However, one needs to consider if the premium payments will negatively affect their current lifestyle.

Next, let’s look at some common questions we hear about life insurance. 

“Is it true that only the working spouse needs life insurance?“

Even though the non-working spouse may not be bringing home a paycheck, he or she is still a huge contributor to the family unit. If this person was no longer around, would there be childcare needs, tutoring, cooking, shopping, housecleaning, appointment scheduling, or other activities that the spouse is instrumental in managing. If these items would cause a financial hardship to the household by he or she not being around, then life insurance is needed on this spouse as well.

“Do I need life insurance to cover my whole life?” 

Ideally no. As mentioned above the primary reason to have life insurance is to take care of income needs of the surviving dependents. But, if you are debt free, your children are out of the house, and you have accumulated a substantial portfolio (as is the goal of Allgen’s Path to Financial Freedom) then you may no longer need life insurance.

“Does everyone need life insurance?“

It depends. If the three reasons above don’t apply, then there may not be a need. However, if it is being used as an income replacement, it is often used to bridge the gap until enough assets are accumulated. Once there is enough wealth that dependents could draw from OR there are no longer dependents (example: kids are now adults), there may no longer be a need for life insurance. Typically, as people near retirement, there is less and less of a need for it.

“How much does one need? “

You may hear a general rule of thumb of 10-12 times your salary in response to this question. So, if you make $50,000, then you need approximately $500,000 in life insurance.

While this is a general rule, we like to delve a little deeper. The actual amount you need depends on several factors including, but not limited to, household expenditures throughout the year, total debt, whether there is an inheritance, passive income, only one partner is working, or income disparity among household earners.

It is best to discuss this with your financial advisor who knows your situation best and can help determine a more specific number.

“I hear a lot about Whole Life and Term Life insurance. What is the difference? “ 

Term life insurance is where you pay a premium for a specific “term,” or period of time, in exchange for a guaranteed death benefit. Terms are typically 10, 15, 20, or 30 years. The premium usually remains the same until that term expires. This is the least expensive type of life insurance to have. This is usually what we recommend if there is a need.

Permanent life insurance (aka Whole Life, Universal Life, Variable Life) is a combination of death benefit and savings. Part of the premium covers the insurance cost and the remaining premium accumulates in a savings or separate investment account called “cash value”.

The premiums are typically much higher than term insurance for less death benefit. There are usually many fees and hidden costs associated with this, meaning it may take many years before the cash value (the amount accumulated in the separate account) breaks even with the amount invested. It can also be difficult to take receipt of the ‘cash value’ in the account due to surrender charges and other costs.

While there are some instances where this makes sense, it is generally not the most efficient or effective way to provide life insurance, in our opinion.

Summary

At Allgen, we generally believe in keeping insurance separate from investments. If there is a need for life insurance it should be covered to protect your family. Our basic philosophy in the pursuit of financial freedom is to keep insurance costs low in order to direct cashflow to the most appropriate places. More discretionary income could allow you to knock out consumer debt quicker or save faster.

We look forward to assisting you with any questions you may have.   We also invite you to stay connected with Allgen’s market viewpoints and financial education.  Our weekly “Money Minute” video series answers your financial questions and helps guide you on your path to financial freedom.  You can find us via www.allgenfinancial.com, Facebook, LinkedIn, Twitter and YouTube.

Written by Paul Roldan, Ana Fernandez, CFP® and Teresa Talton, CFP®, with Allgen Financial Advisors, Inc.  

Still need some help with Life Insurance? Call us!

Important Disclosures: The information provided here is of a general nature and is not intended to answer any individual’s financial questions. Do not rely on information presented herein to address your individual financial concerns. Your receipt of information from this material does not create a client relationship and the financial privileges inherent therein. If you have a financial question, you should consult an experienced financial advisor. Moreover, the hiring of a financial advisor is an important decision that should not be based solely upon blogs, articles, or advertisements. Before you hire a financial advisor, you should request information about the financial advisor’s qualifications and experiences. Past performance is no guarantee of future results. All expressions of opinion are subject to change without notice in reaction to shifting market conditions. Data contained herein from third party providers is obtained from what are considered reliable sources. However, its accuracy, completeness or reliability cannot be guaranteed. Examples provided are for illustrative (or “informational”) purposes only and not intended to be reflective of results you can expect to achieve. Allgen Financial Advisors, Inc. (“Allgen”) is an investment advisor registered with the SEC. Allgen does not provide personal financial advice via this material. The purpose of this material is limited to the dissemination of general information regarding the services offered by Allgen. It is not intended to be a solicitation or offer to sell investment advisory services to residents of any state in which Allgen is not currently authorized to do so. The Disclosure Brochure, Form ADV Part II, which details the business practices, services offered, and related fees of Allgen, is available upon request.

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Great question! Let’s Explore.

In a lot of our #MoneyMinutes, we reference “Allgen’s Path to Financial Freedom”.  We realize that everyone may not know what the path is or what to think when we reference this financial adventure. In this episode of Allgen’s #MoneyMinute, Jason and Paul will expand on our different “life stages” (Foundation, Formation and Freedom) and talk about how they fit into the path and your financial journey.

To follow along with the video, here is a visual representation of Allgen’s Path.

©Allgen Financial Advisors, Inc., All rights reserved

Advisory services are offered through Allgen Financial Advisors, Inc., a registered investment advisor.

Any information provided in the blog has been prepared from sources believed to be reliable, but is not guaranteed by Allgen Financial Advisors, Inc. and is not a complete summary or statement of all available data necessary for making an investment decision. Any information provided is for informational purposes only and does not constitute a recommendation. Allgen Financial Advisors, Inc. and its employees may own options, rights, or warrants to purchase any of the securities mentioned in this e-mail. This e-mail is intended only for the person or entity to which it is addressed and may contain confidential and/or privileged material. Any review, retransmission, dissemination or other use of, or taking of any action in reliance upon, this information by persons or entities other than the intended recipient is prohibited. If you received this message in error, please contact the sender immediately and delete the material from your computer.

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With the 2016 tax deadline quickly approaching, we have a few tax advantages that we thought would be worth  the mention. In this episode of Allgen’s #MoneyMinute, Jason Martin and Paul Roldán of Allgen Financial Advisors discuss a few options that may still be available to you depending on your financial picture. Take a listen to see if any of this applies to you, and don’t hesitate to give us a call if you have any questions!

Have Questions About Your Taxes? Contact us!

Advisory services are offered through Allgen Financial Advisors, Inc., a registered investment advisor.

Any information provided in the blog has been prepared from sources believed to be reliable, but is not guaranteed by Allgen Financial Advisors, Inc. and is not a complete summary or statement of all available data necessary for making an investment decision. Any information provided is for informational purposes only and does not constitute a recommendation. Allgen Financial Advisors, Inc. and its employees may own options, rights, or warrants to purchase any of the securities mentioned in this e-mail. This e-mail is intended only for the person or entity to which it is addressed and may contain confidential and/or privileged material. Any review, retransmission, dissemination or other use of, or taking of any action in reliance upon, this information by persons or entities other than the intended recipient is prohibited. If you received this message in error, please contact the sender immediately and delete the material from your computer.

The post Last Minute Tax Advantages for 2016 tax year appeared first on AllGen Financial Advisors, Inc..