Personal Finance Advice and Financial News

Protects the checks – Using cheque printing machines goes a long way in protecting the checks. A printer who is knowledgeable is very useful to businesses and companies that require the service.

Reduces instances of fraud – Check printers are efficient when it comes to reducing fraud. That is, with the ever improving advancement in technology it is easier to reduce the chances of fraud that happens during money transfer. Generally, more than 90% of attempts to defraud the company of money will be halted in the process of clearing aided by the printing machines.

Copy protection – Check printing machines have a copy protection feature. With this, documents that are printed using the machine have words that are hidden and only become visible when a photocopy of the document is done thereby exposing unauthorized printing.

Technology – The printing machines are carefully constructed with modern day technology features that are capable to prevent fraud. Among the popular features on these machines include those that prevent forgery, counterfeiting as well as falsely altered cheques.

Holograms – This is another feature that is aimed at the prevention of fraud. Holograms are impossible to forge and are only visible in normal light. Holograms may include distinct company logos and are easily destroyed when lifted from a different page.

Embedded image – Using embedded image on cheaks is also another means of preventing fraud. This is because the images can only be seen from a specific angle and are impossible to forge due to their distinct nature.

UV Sensitive ink – Some cheque printers have added UV sensitive ink to their fraud prevention measures. This ink is usually invisible under normal light but can be seen under UV rays letting you see all the information on the document clearly. Check printers may be used to print a wide range of information that includes the amount, name and date.

There are numerous cheque printing service providers that you can find online today. These printers have a range of software relating to cheque printing including cheque management, counterfoil maintenance and covering letter. Although cheque printers have put in place sufficient measures to prevent fraud, you may want to consider getting scanners that are handy in establishing the authenticity of checks. In summary, the choice of cheque printing service providers must be handled with a lot of care while paying attention to a number of factors like the technology they use and how well they have handled previous projects.

It is said that anything that has a beginning also has an end. In a similar vein, anything that has end also has (or had) a beginning. Just as there can not be a beginning without an end, there also can not be an end without a beginning because each of them necessarily implicates, involves and entails the other. Every beginning is a journey toward an end, while every end is a journey from the beginning. In addition, just as every beginning is a journey towards an end, every end is also a journey towards a new beginning.

It is obvious that the end of a year and the beginning of a new one is a clear reflection of this philosophy. As a New Year begins, its end is a matter of time. As a year ends, the beginning of a new one is also a matter of time. In addition, the reality of the end of the New Year is also a matter of time. As a matter of fact, every old year was once a New Year, and every New Year will eventually become an old year (with time). Although a year passes by, the events and activities become part of history.

October, the ninth month of the year, marks the beginning of the last quarter of the year. Here, it marks the beginning of the ending of the year. Every New Year is naturally ushered in with high hopes, optimisms and expectations. I am confident that you were not only very expectant, but also hopeful, of a better, brighter and more prosperous life for yourself at the beginning of this year. However, the big question is, “How many of your expectations at the beginning of this year have become realities?”

It is of absolute importance that you pause for a while and ask yourself this question of all questions. Otherwise, there may be no meaningful difference between where you are now, and where you will be by this time next year. It is very worrisome that after ushering a New Year with high hopes, optimisms and expectations; the euphoria and excitements of the New Year gradually fade away as the year grows old. Worse still, some expectations of the New Year become jettisoned and forfeited with time.

The truth of this claim may be obvious in your personal experiences and observations in the lives of most people around you. This, however, is not a way of saying that the expectations of everyone in every year are not achieved. The bitter truth is that only a very negligible percentage of humanity celebrates meaningful achievements and accomplishments at the end a year. For most others, the goals, aspirations and expectations of the year are either partly (or partially) achieved, or completely betrayed.

Another big question for you is, “Where do I belong?” Are you among those who have meaningful success to show for the year, or are you among those who achieve a part of their expectations for the year? Worse still, are you among those who expect for the year are completely defeated? It is very important that you take stock of your life in order to ascertain where you belong. This is an obligation you owe yourself because it is a prerequisite for having a good beginning in the next year.

One of the most significant observations I have made is that most adults do not know how to end a year, and how to start a New Year. Since the end of the year coincides with the celebration of Christmas, and the beginning of a year coincides with New Year celebration, it is a pity that most adults equate their preparations for these great celebrations with their preparations for the end of the year and the beginning of a New Year respectively. This is a common mistake that is fueled by ignorance.

As a matter of fact, in the opinion of most adults, preparing for the end of the year is synonymous with preparing for Christmas; while preparing for the beginning of a year is synchronous with preparing for New Year celebration. To make the matter worse, many organizations, associations, unions, clubs, etc. organize parties to mark the end of the year, as well as the beginning of a year. This is not a way of saying that there is something intrinsically wrong with any of these celebrations.

The point being argued, however, is that the preparations for these celebrations and the celebrations themselves have the inevitable consequence of shifting the focus of most people away from the vital, critical, ultimate, supreme, ideal and most valuable activity of the season – appraising your performance in the year. It is worthy of note that just as preparing for wedding is not the same with preparing for marriage; preparing for Christmas celebration is not the same as preparing for the end of a year.

In addition, preparing for New Year celebration is not the same with preparation for the beginning of the year. Just as preparing for wedding is preparing for a day event, while preparing for marriage is preparing for a life event; preparing for Christmas and / or New Year celebration is preparing for a day event, while preparing for the end of the year and / or the beginning of a New Year is preparing for life. This is an axiomatic every adult must come to terms with before he can enjoy a meaningful life.

If you were asked to review this year, what will you parade as your achievements in the year? Perhaps, most people will have no significant success to show for the year. It is a pity that the only success many people record at the end of every year is an additional year to their ages. However, wise people do not celebrate age. Rather, they celebrate the achievements that accompany their age. You were asked earlier, “How many of your expectations at the beginning of this year have become realities?”

If you are also asked why only a very negligible percentage of humanity celebrates meaningful achievements at the end of a year, what would be your answer? Why is it that most people have nothing meaningful to celebrate at the end of every year? Before you can answer these questions, you must answer another question, “How do people start a New Year?” But before you can answer this question correctly, you should also answer another one, “How did they end the previous year?”

How you end a year often determines how you start the year after it, and how you start a New Year often determines how you end the year. The reason most adults have no meaningfulful accomplishments to celebrate at the end of a year is that they made no meaningful preparations for the end of the previous years and the beginning of the year. Worse still, they do so year after year. It is a pity that out of ignorance, most adults are more committed to preparing for a day event, rather than for their dear lives.

Life is a school. While we matriculate into it at birth, we graduate from it at death. However, just as practiced in conventional schools, there are periodic examinations in the school of life. You will never be (qualified to be) promoted to the next level of life until you pass the examinations of the present level. However, unlike conventional schools, the questions for examinations in the school of life for every individual are best set by the individual himself, although someone else may guide him in doing so.

Furthermore, one of the best times to conduct the examination of the school of life is towards 'the end' or 'beginning of' a year. The best way to end a year is to examine how youaired in every aspect of your life in the year. Among the best standards for examining your success and accomplishments in a year are the goals you set at the beginning of the year. This is because, you measure your success in a year based on your goals, proposals, aspirations, aspirations, desires, projections and plans for the year.

Here, it will be difficult to ascertain your performance in a year towards its end, if you did not set any goal at its beginning. It is a pity that most adults start every New Year with high hopes, optimisms and expectations, but without any goals, proposals, aspirations, aspirations, wishes, projections and plans. This is why they can not ascertain either they are progressing or not at the end of the year. Life is like a business. You should know the financial status of your business at every point in time.

Realizing your mistakes and failures in a year, especially after evaluating your performance in the year towards its end, usually has the tendency of inspiring, motivating and challenging you to prepare to bypass them in the year after. The reason for this claim is that appraising the year is not an end in itself, but a means to an end. Your findings from your evaluation of your performance in a year determine the goals you set for the New Year, as well as the steps you take in the New Year.

This is one of the key benefits of evaluating your performance towards the end of a year. Except you take stock of your life towards the end of the year and realize the areas you excelled and the areas you failed; you will not know the areas to improve on in your life. When this is annual success-inducing ritual is neglected repeatedly; success and the future are forfeited, even without any regret. This is one of the reasons most people remain static in the journey to success year after year, even as time flies.

Ending a year and / or starting a New Year without meaningful preparations has disastrous long-term, if not lifetime, consequences. You find yourself in the best position to set reasonable goals and make meaningful plans for a New Year after evaluating a year that is about to end. You will do yourself a great favor this year if you will focus on preparing for the end of the year and the beginning of another year, rather than preparing for Christmas and New Year, respectively.

If you treat this message with the seriousness it describes, it will position your feet on the fast lane to success. If you do not, you may continue to wonder why success continuously eludes you, please make your efforts to make it a reality in your life. Do not forget in a haste that the reason you should not treat issues about your life with levity is because you are the best beneficiary of your success, but the worst victim of your failure. Your destiny is safest in your hand. That is where you should keep it.

Savings are the cornerstone of financial security at any level. We all know that it's something we should be doing, so why do so few people manage it?

When you're living paycheque to paycheque, as many people are in the current economic climate, it becomes a daunting task to set any money for the future. The primary concern is to meet the rent and bills now rather than worry about hypothetical costs further down the line and this perfectly natural. This does not mean that it's impossible to start saving, just that it requires discipline.

So what are the key points to start saving for the future?

Firstly, start small. If you do not think that you can afford anything then start very small.

Put away £ 1 a week if necessary, 10 pence, whatever you can afford. Make sure that you do this regularly, have a set time every week so that you do not forget. In fact, the easiest way to do this is to set up a regular transfer from your account to a savings account. If you set the transfer to go through on the same day as your payday then the money will go straight out to your savings, it will not be in your account long enough for you to notice that it's gone!

Secondly, start today. Do not plan to start next week, next month or next year, start now. Every day that goes by your savings will increase, every day that you do not is a missed opportunity.

Another crucial point is very simple. Do not touch the savings! Towards the end of the month you may be tempted to take money out of your savings to see you through until payday, often with the intention of paying the extra back in. Do not. You'll have to pay a little more in to your savings just to get back to where you were, so you'll be more likely to do the same the next month, and the next month. It's an easy cycle to get into and a difficult one to get out of so avoid this trap in the first place.

However, you do need to establish what your savings are for. Are you saving for retirement, a new car or just to have some emergency money? What establishes an emergency? Set yourself boundaries and stick to them!

I've found it helpful to have to separate savings accounts, one for long-term, one for an emergency fund. The long-term savings I do not touch under any circumstances, that will ever be a deposit on a house, or even a retirement fund. The emergency fund is different, this covers expenses that are not covered in my monthly budget, but only emergency expenses.

For example, if the MOT is due on my car, then this is budgeted for and paid for out of my regular account. However, if my car breaks down and costs £ 200 to get back on the road, then this is an emergency payment from my savings. I need the car working and can not afford to take that hit to my monthly budget.

Using the same example, it shows how important savings are. If I did not have that backup in place then that would have to come out of my monthly budget and leave me short on everything else for a month. This could leave me with no money for petrol, food or even rent. Having that backup, however small it is, can make the world of difference when the situation gets difficult.

A lot of keeping control of finances is about forming the right behavioral habits and this is no exception. You'll feel the difference in your budget initially, but after a few months it's unnoticeable. You grow accustomed to living off slightly less money, meanwhile your savings can just grow and grow.

Online banks are not recent evolutions in the financial world, with humble beginnings starting in the early days of the internet around 1995. Today, using an online bank is universal and broadly popular.

We're speaking of internet banking, with all the product and service found in traditional banks, but with much of the overhead removed. Internet-only banking is the marriage of cloud computing with high-tech efficiency. It delivers a transparent super-charged system of personal money management.

A word to the wise, here, it's not the same as using your traditional banks e-commerce or mobile services. The online bank experience has advantages not matched by the traditional banks with their widespread physical presence and higher operating costs.

Savings Accounts

Savings account balance requirements are rather friendly with online banks. On average you only need a balance of $ 350 or higher with online banks before service fees kick in.

Traditional banks average $ 4,500 minimum balance to get out of fee charges. My personal bank requirement is $ 3,500. A $ 12 per month fee applications if the balance drops below $ 3,500, even if for one day.

Beyond lower fees, interest rates paid by online banks are higher. The four largest brick and mortar banks in the US, all with worldwide presence, pay 0.01% annually compared to 0.95 – 1.00% with their online siblings.

Framing this in real dollars, $ 10,000 in a savings account at 0.01 percent interest will earn a whopping $ 1 after a year. However, $ 10,000 at 0.95 percent will yield $ 95 in interest. That's $ 94 extra dollars before the power of compound interest growth kicks in.

Checking Accounts

You can open most checking accounts with $ 0.00 – $ 50 at internet-only banks, and account fees are generally lower than store-front banking. Often, standard checks are at no cost, plus free re-orders are common.

Other bank evaluations like overdraft fees, transfer charges, and special service costs are lower, too. There are some online banks that charge nothing for overdraft transfers, ACH transfers and cashier's checks.

ATM's

No doubt ATM service is a must in banking and lets traditional banks run with a smaller footprint. While online services can not top the corner bank for branded ATM locations, they do offer a functional alternative.

Allpoint ATM network is predominately used for automated teller services by online banks. Allpoint ATM has 55,000 free for use ATM's in North America in retail locations like CVS Pharmacy, Target, Costco, and others. Some internet banks will refund for fee's charged at non-network ATMs as a way to offset site limitations.

Deposits

While this is a bit tricky for some people, depositing money into an online account really is not difficult. As with local banks, you can easily deposit checks or cash into a network ATM.

Using a mobile banking app, deposits are possible from anywhere and at anytime, as long as a wireless network is available. Mobile deposits are as simple as snapping a picture of a check. The bank app records the deposit directly into your account.

Moving funds between accounts and transferring funds outside the bank system are just as convenient. Direct deposit of paychecks is straightforward with the app, too. It's no surprise that brick and mortar banks have moved into the mobile app arena.

Security

Security always looks to come up when internet and cloud computing is the topic. I will not say much about this other than data theft is a problem, but no more so whether with an online bank, private company, physician's office, or any business that stores data electronically.

This is scary to a lot of people, but I can tell you that banks with physical buildings do not offer any more comfort. Their data storage is cloud centered and transactions are electronic data transmissions.

Financial institutions ranging from Federal facilities, to Wall Street institutions, to local banks house our personal information in big data centers. In fact, data center companies are a huge business sector in America. While cyber security is a serious issue, it is not any greater issue with an online bank than the bank down the street.

Summary

The comforts found in a traditional bank are still important to a lot of people. Face to face contact is still a need at times, and traditional banks beat in areas such as loan officer availability, brokerage services, real estate & mortgage specialists, and other professionals.

But, it also comes down to the fact that brick-and-mortar branch banking carries a lot of costs, with the greatest being physical buildings and staff. This overhead passes straight to customers through fees, charges, and low-interest rates.

Online banks are cheaper to run because they do not have buildings to keep up nor large staffing needs. You can do everything done in traditional banking, but with efficiency, lower cost, and higher earnings return using an online bank. With the online bank, it's all about low fees and higher interest rates.

For many people, online banking is not the best option. For others, however, mobile app's, cloud technology, and mobile communication are second nature in their lives already. The online bank could simply be an extension into their current virtual world.

Without a doubt, establishing and maintaining retirement benefits are important for all of your business owner clients. Fortunately, we practitioners now have greater options than ever before to help our clients. Current customized special programs are more efficient, provide greater benefits and are now possible since the passage of the Economic Growth and Tax Relief Reconciliation Act of 2001 follows by the Pension Protection Act. When done correctly, these plans can reduce taxes and provide future benefits. If done incorrectly, they may bring IRS scrutiny, among other problems. To avoid unwanted issues, you may want to consider some of the following plans available to business clients.

Qualified Retirement Plans; Qualified retirement plans are particularly suitable for small business owners who are in high-income tax brackets because they are fully deductible from ordinary income taxes to the business owner. This may also serve as a solution to the looming Alternative Minimum Tax (AMT) issue because they are not a tax-preference item.

Cash Balance Plans; Cash balance plans have been used to reduce the cost of employee benefits and can now be capitalized on to a greater extent since the passage of the Pension Protection Act. Cash balance plans offer employers advantages not available with other qualified plans. For example, small business owners can make large defined benefit-sized contributions with small 401 (k) -sized costs for the employees. They can be used when employee cost is too large to make a traditional defined benefit plan appealing to the owner (s). When designed properly, the owner (s) contributions can exceed $ 100,000 per year and can even exceed their salary. A cash balance plan can be combined with a 401 (k). A properly designed cash balance plan can make 90 percent of the contributions and benefits available to the owner (s) and / or preferred participants.

Self-employed Individual and Partnership Plans; Self-employed individuals and partnerships consisting of only owners and their spouses (ie, no common law, non-owner employees) should consider the Micro (K) ®. For example, a one person S Corporation in which the sole owner has $ 116,000 of compensation paid on IRS Form W-2 can receive 25 percent of eligible payroll as an employer deductible contribution. Then the owner, as an employee, can defer salary up to $ 15,000 (2006 limit). Consequently, a W-2 $ 116,000 salary results in an allowable deductible contribution of $ 44,000. The calculation for a business entity that is not taxed as a corporation (no W-2 compensation) is not so simple, but the results are somewhat similar. This plan can also make life insurance tax deductible, if desired. Additionally, up to $ 50,000 can be borrowed from the plan.

Small Business Plans; Many small business clients have used a SEP-IRA or basic profit sharing plan for their retirement needs due to the simplicity and low cost of these designs. However, recent favorable tax law changes have made these designs less effective. Worse yet, if you have any eligible employees, these may be among the most expensive plans to fully fund. A Dash 401 (k) is a much better alternative. One of the many benefits is a substantively lower employee cost. Unlike a SEP-IRA, a Dash 401 (k) will allow you to borrow up to $ 50,000 from the plan. This allows a business owner to make the greatest possible contribution without tying up all of his money until retirement. The plan allows life insurance to be deducted, if it is needed. The Dash 401 (k) is flexible.

For example, a business owner with a $ 100,000 W-2 wage has a staff member earning $ 40,000 in W-2 income while another staff member earns $ 25,000 in W-2 income. The Dash 401 (k) would allow the owner a contribution of $ 45,000, while the workers' contributions would be $ 2,000 and $ 1,250, respectively. This is a great way to maximize your business clients' income and retirement security potential.

Additional Plan Options – If your client has a C Corporation and wants to get money out while obtaining a deduction, a §162 executive bonus plan could be considered. With this option money taken out of the corporation is a deduction. The plan can be discriminatory and the money can take the form of a bonus to the owner and / or key executive.

With these or any other type of plans, business owners must be careful when choosing a tax advisor. We are constantly called to help when a business owner runs into trouble. Many investment providers have entered the market with little emphasis on administration. A document may be provided, but no effort is made to monitor the calculation of allowable contributions. In addition, there is no built-in method for dealing with non-owner common law employees who are hired, or are improperly excluded because they are considered part-time or independent contractors. Many plans, especially 401 (k) and profit sharing plans, quickly run unfavorably for reasons such as:

• Improperly excluded part-time employees.
• Improperly timed salary deferral elections and deposits
• Incorrectly calculated profit sharing contributions
• Incorrectly calculated loan amounts.
• Improperly managed loan repayment schedules.
• Incorrectly calculated incidental life insurance premiums.
• Improperly timed salary deferral elections and deposits.
• Improperly excluded newly eligible non-owner participants.
• Failure to make top-heavy minimum contributions.

The IRS, Department of Labor, and other regulators have increased enforcement and penalties. Some popular plans currently being sold are considered potentially abusive tax Shelters, even placing the accountant at risk for penalties.
Remember, the time to handle potential problems is before they happen.

Life settlements are fast growing into a staple of the insurance and financial planning world. Most financial professionals have heard of life settlements, which is the sale of a life insurance policy of a senior (age 65 and over) for a lump sum which is greater than the policy's cash surrender value but less than its death benefit. Policies which are viable for a life settlement are generally those beyond the contestability period wherein the insured has a life expectancy of between 2 and 15 years. Today life settlements are controlled by institutional funds and pension funds.

Despite the continued growth in the life settlements market, the number of insurance or financial professionals that have actually completed a life settlement is surprisingly low. This can be attributed primarily to a lack of in-depth knowledge of life settlements on the part of these professionals. Considering that life settlements are a relatively new option for policy owners, many financial professionals, although having heard of life settlements, have still not had the opportunity to delve into the subject on a defect level.

Many policy holders come to a joke wherein they continue to pay life insurance premiums on an unwanted policy in hopes of a gain at maturation, or to recoup some of the investment by trading the policy for its cash surrender value. Corporate policyholders often face additional dilemmas when dealing with departing executives with key-man or split-dollar policies, or insurance purchased as part of a buy-sell agreement.

With a life settlement, the policyholder realizes an amount much greater than the cash surrender value in exchange for the policy's ownership. Term life insurance policies are also applicable when converted into permanent insurance. Life settlement transactions involving key-man or buy-sell policies can provide businesses with increased cash flow to solve immediate financial problems, while transactions relating split-dollar policies typically involve relocation planning and charitable giving issues.

In short, life settlements offer policyholders of all kinds an array of options previously unavailable to them.

In a recent adviser survey, nearly half of the respondents had clients who had submitted a life insurance policy, many of which might have qualified for a life settlement transaction and partial lump sum cash payment.

In this article I will discuss in depth the underwriting process related to life settlements, which is of paramount importance in the process, just as it is in life insurance itself, although there is a great deal of difference in the process for each respect.

Settlement amounts are determined by a multitude of factors that arrive at a Net Present Value, which is the present value of future benefits from the death benefit minus the present value of future payments associated with sustaining the policy until maturation. These expenses include premium payments, cost of capital and administrative costs. This calculation enables the purchaser to factor in the desired profit from the investment and offer an offer to the seller of the policy. Due to the fact that the investor will be sustaining the policy premiums until until maturation, the life expectancy of the insured becomes critical in assessing the value or sale price of the policy. If the assessment of an insured's life expectancy is too short, the purchaser will have paid too much and risks a financial loss. By contrast, the assessment of an insured life expectancy should be longer than his or her actual life span, the offer to the seller would have been less than it could have been, so resulting in an undervalued sale for the policy owner. Institutional investors in life settlements generally obtain life expectancy reports from two or more independent LE (life expectancy) providers. Many of the larger institutions investing in life settlements have proprietary underwriting personnel on staff. LE reports can vary significantly based on interpretations, medical data on the insured, and / or the actuarial tables used.

DIFFERENCES IN UNDERWRITING METHODOLOGY – Companies which provide LE reports use actuarial and medical experts who apply probability theory, actuarial methodology and medical analysis in calculating the probable mortality of an insured. Many LE providers employ the services of experienced life insurance underwriters who work in tandem with the actuarial and medical experts. There are a number of companies which provide LE reports. Among those most commonly accepted by institutional investors are: AVS, Fasano, 21st Services, ISC Services and EMSI. These companies specialize in underwriting the senior segment (insureds above the age of 65) and have developed specified methods, underwriting manuals, and mortality tables. The insurance industry routinely employs Reinsurance underwriting manuals as the basis of its ratings for insurability. However, Reinsurance manuals are gauged primarily for insurance applicants up to the age of 65 with insurable impairments up to 500%. These standards reflect the traditional demographic for life insurance. Conversely, life settlement underwriting is geared toward those above the age of 65 and can have amortization ratings much higher than 500%.

In order to cater to this market segment, adaptations were made to these underwriting manuals based on extensive research of current senior mortality data and scrutinized against recent medical advances and the treatment of diseases or disorders often associated with the elderly. In addition to this, companies that provide LE reports also draw from, and factor in, proprietary data accumulated from previous assessments. Typically, a traditional debit and credit methodology is used by the underwriter in determining the overall rating of an insured, resulting in either standard or substandard. Of course, this is an approximation due to the fact that few impairments cause a uniform percentage increase in mortality. Results using the standard debit and credit method produce reasonable and quantifiable results; however, for conditions such as many forms of cancer, the debit and credit methodology does not generate reliable results. This is primarily due to the fact that the impaired mortality curve is significantly different from the standard curve used in the absence of these impairments. Companies that provide LE reports employ different approaches in order to calculate these impairments. Some utilize the debt and credit approach, others apply extra deaths for a limited time span, and still others will use a combination of the two and apply them to the actuarial calculations. For a policy with a high impairment and a short life expectancy, clinical judgment may supersede the actuarial calculation. Life expectancy calculations utilize the underwriting assessment in tandem with the appropriate mortality table; however each life expectancy provider uses its own proprietary mortality tables based on sex, smoker or non-smoker status, disadvantage and preferred class. The general understanding is that most life expectancy providers use the 2001 VBT (Valuation Basic Table), but it seems that most use a heavily modified version of the 2001 VBT or their own table altar.

Individuals with medical conditions such as Alzheimer's disease, congestive heart failure and other serious ailments would most likely be declared for a life insurance policy. However, for the purposes of a life settlement, it is possible to estimate the life expectancy of an insured with these medical ailments. For insureds with serious medical conditions, life expectancy tests often take into account factors that contribute to healthy aging, such as regular physical exercise, social activities, the mental attitude of the insured, and his or her commitment to living a healthy lifestyle. Access to care givers and a support network, are also variables that are taken into consideration. All of these factors can sometimes add a level of complexity to thewriting process that will affect the final mortality calculation

DIFFERENCES IN UNDERWRITING REQUIREMENTS – When submitting an application for a large life insurance policy on an older individual the application needs to be accompanied by medical data as outlined in the insurance company's requirements guidelines. This medical data would usually include a physical examination, blood profile, EKG and an Attending Physician's Statement (APS). Many insurance companies also require functional assessments of an applicable, which include ability to carry out the activities of daily living. Often, financial underwriting is a part of this assessment of insurability. By contrast, life settlement underwriting is based on existing medical data and rarely requires any medical examination, EKGs or blood work. A life settlement application should be accompanied by HIPAA and release of medical information forms. The application is then followed by Attending Physician's Statements ordered from selected physicians by the company transacting the life settlement, usually a broker or provider. This information is then forwarded to the company or companies providing life expectancy reports on the insured. After reviewing the attending physician's statements and medical history, a life expectancy provider will provide a detailed LE report on the insured. Based on the information in the LE report and the profile of the life insurance policy, an institutional investor will prepare an offer on the policy. Occasionally, the company or companies providing the life expectancy report will indicate that additional information from an attending physician may give them further insight into the insured life expectancy, which would probably affect the offers from institutional investors. In such a case, the life settlement broker or provider will order additional information from the appropriate physician (s). In cases where the insured has not seen a physician in two or three years, which would seem to be a good thing, indicating that the individual is not suffering from any chronic ailments, the company providing a life expectancy report is afford little current data on which it can effectively base a life expectancy assessment.

The principal difference in underwriting for life insurance and life settlements is that in traditionalwriting as low a mortality rating as possible on any medically impaired risk would have preferred in order to obtain a lower cost of insurance. By contrast, for life settlements a higher impairment rating would result in a shorter life expectancy. Thus, the insured would receive a larger settlement for his or her policy.

SELLER BEWARE – With life settlements growing at an astounding rate, there are more and more companies seeking to enter this market. Many states have some form of regulation relating to life settlements, while others are unregulated or pending regulation. Some life settlements, such as those on a variable policy, are considered securities transactions. With all of these different regulatory variables, it is important for insurance and financial professionals to make sure they work with a reputable company to facilitate a life settlement. When considering which life settlement company to work with, most of us look for the obvious: to wit, a company that will facilitate and expedite the policy with professionalism as well as acquire competitive bids from a number of institutional investors. However, sometimes of even greater importance to the professional, is a company that has an infrastructure that enables the record keeping necessary to fulfill regulatory standards, as well as a compliance department that will keep abreast with changing regulatory requirements and reporting. Most importantly, the company should hold the applicable licenses in the states were it conducts life settlement transactions.

Not surprisingly, these various attributes and characteristics tend to coincide with each other. A reputable company will hold all of the applicable licenses needed, or will refrain from activities in states in which it is not licensed. If they have the proper reporting and record keeping capabilities, this is usually overseen by a compliance department that is also liable for licensing and regulation. Organizations such as these generally have built an infrastructure that has the manpower to process settlements with fastidious precision. Processing large numbers of settlements according to a high standard will give a company a preferred status and leverage with institutional investors, which may even result in higher offers on a given policy.

Be sure to ask the life settlement company if it is licensed and in what states. If they do settlements for variables, ask if these are cleared through a broker dealer and what their relationship to that broker- dealer is. Use the Internet and other tools to research the company you plan on using for a life settlement. The issues may seem trivial today, but fast-forward three years after a life settlement with an unlicensed company that has fallen off the face of the planet and guess who's left holding the bag.

Do you ever get the feeling that financial advisors are looking out for them instead of looking out for their clients? You may be right. In most cases they really are looking out for themselves.

Unfortunately many financial advisors (brokers) do not have an accounting or finance degree. They have simply passed securities or insurance exams and the state and the federal authorities unleash them on the public. Even if they want to act in their client's best interest many times they do not have the skill set to do so.

To make matters worse, in most instances the financial adviser has a reliably light level of responsibility called suitability. The suitability rules require that when a broker recommends that a client buy or sell a particular security, the broker must have a reasonable basis for believing that the recommendation is suitable for that client. In making this assessment, your broker must consider the client's risk tolerance, other security holdings, financial situation (income and net worth), financial needs, and investment objectives.

Suitability abuse can be broadly defined as recommending or implementing an appropriate investment based on a client's age or risk level, failing to disclose risks associated with an investment or failing to disclose materialally important information that may lead to a more informed decision,

Let us look at an example of suitability abuse. A financial advisor we'll call Mr. X says they should buy an S & P 500 stock index mutual fund, as it is a suitable investment. Mr. X agreements and requests for a recommendation. If the financial advisor recommends the high load, high expenditure S & P 500 index mutual fund managed by the same firm the financial advisor works for instead of a no-load, low expenditure S & P 500 index mutual fund has another company, the financial advisor has met the suitability requirement. Coincidentally, the financial adviser would also receive a higher level of compensation.

How can that be you ask? Because the cards are stacked against the client. Clearly, suitability is not concerned about the best or most favorable service or product.
To make matters even worse, many financial advisors work for publicly traded financial service companies. You know the ones that have their names on baseball stadiums, advertise during the Super bowl, and have their names stitched on the shirts of professional golfers.

These publicly traded companies do not remain in existence for the good of clients. They remain in existence for the good of shareholders. Can you imagine the chairman or chief executive officer (CEO) of one of those publicly traded companies coming on the evening news broadcast to say they place their clients' interest before their shareholders? First off, they will have violated the law. All publicly traded companies must act in the best interest of shareholders, not clients. Second off, their head would be on the chopping block.

No shareholder in their right mind would allow the chairman or any other board member to place any other party's interest ahead of their own. The shareholders hired the board to make sure management runs the company in the best interest of the owners-the shareholders, not clients.

Health Savings Account Plans

Your employer may offer the option of Health Savings Accounts (HSAs). These are coupled with a High Deductible Health Plan (HDHP). Small business owners, self-employed and individuals may also use this program.

Qualifying Insurance

A qualifying plan must have a minimum deductible of $ 1,300 for single and $ 2,600 for family. Maximum out-of-pocket costs are $ 6,450 for single and $ 12,900 for family.

To be a qualifying plan you must receive a written statement certifying your plan qualifies as a HDHP. Plans may have the required features; however, the insurance company must be willing to report qualifying policy holders to IRS to qualify. You need the statement from the insurance company to qualify as a HDHP.

High Deductible Health Plans

Most HDHP are Preferred Provider Organization (PPO). When possible, process all your medical claims through your insurance carrier. You may not meet your deductible. However, the PPOs have contractual agreements with providers for maximum charges that you only receive through your insurance carrier.

Health Savings Accounts

A Health Savings Account is a great place to accumulate funds to cover out-of-pocket medical expenses. The maximum amount you can contribute is $ 3,350 for a single and $ 6,650 for families. If you are over 55, you are allowed an additional $ 1,000 contribution.

This is similar to “catch-up” provisions allowed for IRAs and 401 (k).

The annual contribution amount changes every January. The change is based on Consumer Price Index (CPI).

For an individual, you have until April 15th to make your contribution to your Health Savings Account. This is like contributions for an IRA.

If your HSA is with an employee, you are likely to be on a calendar year for contributions similar to your 401 (k) contributions.

Health Savings Accounts are portable. You may begin an account with an employer and then change employment. You may take your account with you – rolling it over like you can do with a 401 (k).

There is not a limit to how much you may accumulate in an HSA. You also may invest your funds – employers may have restrictions on investing. The earnings on your HSA are tax-free, losses are non-deductible. Your administration fees for HSAs are tax-deductible. Investment fees are not.

Timing is everything. A High Deductible Health Plan has to be in place before a medical expense is incurred. Contributions to your HSA account to cover the medical expense can happen after your expense. However, it must be by April 15th of the year following the expense.

Timing is everything. The rules change for Health Savings Plans once you are on Medicare. You can no longer contribute to Health Savings Plans. Yet out-of-pocket expenses you incur can be reimbursed from your HSA.

Tip: Set up a Health Savings Account separate from your Insurance. This will make changing health insurance easier should the need occur.

Employers are trending towards Health Savings Plans. The High Deductible Health Plans have lower premiums. The high deductibles cause employees to be more price conscious in their medical care. This also keeps premiums lower.

Part III FSA or HSA?

Do you use FSA or HSA?

It depends. Do you have heavy medical expenses? FSAs have lower deductibles and co-pays. Do you need diagnostic tests or your child need braces? These expenses are paid at the time of services, while you enjoy the benefit of making monthly payments.

Are you healthy? Affordable Care Act requires insurance plans to cover preventative care. Annual doctor visits are covered – not even a co-pay. Many seniors experience heavier health costs as they age. Accumulating funds for your future medical expenses makes sense. You get to deduct it from your income today.

The search for funding involves several different layers of effort and enterprise, and can easily be classified into three phases:

1. Setting up the goalposts:

In the absence of clear and present parameters and clarity in the idea, the chance of receiving funding becomes almost impossible. For anyone to come on board and agree to providing funding, they need to see that the proposal and idea they are evaluating is lucid, comprehensive, and has a clear goal and steps. This shows the evaluator that the entity asking for funding has thought through their idea well, and that it is essential for anyone making a grant proposal to first ensure that they have set up reasonable and achievable goals and criteria. They need to identify the target group they wish to help, and clearly elucidate the how, why, when and where of their proposal. They also need to budget according to these goals and parameters, so that they can show potential grant givers what they are receiving for the funds that they put into the grant.

2. Identifying and customizing according to source:

Any idea will appeal subjectively to different sources of funding. If the target group of the proposal are children, finding foundations that fund programs aimed at seniors would be ideal. Appealing to an organization that caters to tribal affairs for the fund of urban children not of Native American heritage would most certainly not lead to any success, regardless of the quality of the grant proposal in every other field. Grant proposal writers should make the effort to identify and approach the right source for their funding, including the department that they should apply to if they wish to secure federal grants. Then, they need to recognize the aspects of their idea that they need to highlight and which ones to put into the background to make it appeal more to their target foundation or department. By doing this, they enhance how it is perceived by the potential grant provider and increase their chance of success.

3. Writing the Proposal and doing the legwork

When you have set up the parameters and identified the potential sources, writing the grant becomes that much easier because it can be more specific and have more purpose. Further, you can have a better idea of ​​who should be approached and how, and networking in funding conferences can help you get a lot of tips you would not otherwise find. This is the hardest and most difficult part, as writing the grant proposal and doing the required legwork is often the toughest part of obtaining private funding or securing federal grants. An expert with the right kind of experience can often give you the right strategies and methods that would seriously improve your chances, often raising it from a 5% to a 50% chance of success.

Mark's idea of ​​freedom was being able to create meaningful work while spending as much time as possible with his family, sometimes enjoying the tropics of the Dominican Republic. Instead, at age 52, he just died. And – no – it was not a heart attack. At this writing there is no official cause of death. But those who knew Mark well know exactly what it was; it was the fallout of living each day under the extreme stress of honestly keeping up with his family's needs and subsequent debt-load while ignoring his own raising health issues. His is a cautionary tale.

He struggled to keep up a level of productive activity no one person could sustain over time. First, there was his 60-70 hour a week job as manager of a water plant. Then, there was the constant running around he did to help his wife with her coffee-stand business. Finally, in his “spare time,” Mark spent hours late at night working on the project closest to his heart: a win-win business that could potentially get him and lots of folks off the hamster wheel. His goals were large altruistic. I partnered with him for the last two years in the development and launching of this project; we were in the homestretch when he suddenly dropped dead at the end of July.

Mark had dabbled in the foreign exchange market (FOREX) for 12 years and had had enough wins and painful losses to learn what worked and what did not. Combining this knowledge with his altruistic motivation, he designed his own Forex Expert Adviser (EA) software program that he then had professionally built. Unlike other EA's, the components of Mark's EA ensured long-term, slow and steady wins with minimal losses. In July, he was finishing up the last phase of testing and we were finally going to roll it out “live” last month, initially, among a few friends and family. But it was not to be. The dream died with Mark, the only one who great mind held the detailed, specific knowledge needed to bring our project to market.

I wonder if Mark's story is perhaps symbolic of the times we live in? Nowadays I know and hear about so many people whose days are spent “chasing their tail.” I am reminded that full-time workers today take home less for their hard work than they did 4 decades ago (inflation-adjusted). We have to earn more each year just to try to hold on to what we already have. While we are told inflation is ridiculously low, purchasing power at the register continues to evaporate. With the costs of energy, housing and food now removed from the government's inflation formula, the “official” low rate of inflation is deceiving. The counterpoint to paying more for everything while effectively not learning more is, of course, mounting personal debt.

Although most people do not understand why, like Mark, they do recognize that their money does not go as far as it used to, and so “step on the gas” and multi-task in an attempt to get more done and earn more money. But at what cost? Sadly, all too often, this stressful chasing undermines good health and the care of significant relationships. As Mark's sudden death reminded me, you could even pay the ultimate price.

So what helps break this vicious cycle?

Since the world of finance is not about to change, the only control we have is over our own personal circumstances. By consciously moving the ways we earn, spend, save and invest via informed choices, we can make a huge difference in our overall quality of life. However, as in life, there are usually tradeoffs that must be made; it may require some amount of downsizing and recycling / repurposing of existing assets such as homes, cars, boats, motorcycles, etc., to that which can provide authentic long-term sustainability and commensurate peace of mind. The loss of one's personal-finance equilibrium so often is followed in a domino-type effect by the loss of the intangible wealth of health and happy personal relationships.

Those who knew Mark well have their own thoughts about his life and death. I offer mine in hopes that those who did not have that pleasure may learn from this, his story. Reassess priorities and make whatever changes are most helpful to support quality of life for you and your loved ones. Break the cycle.

To my friend Mark: Rest in peace.