Not Having Money Is The Root Of Evil… Here’s Why

Once a woman takes control of her finances, she will never be powerless again. The growing power of women and finances is not some fly by night fad. It is the new normal in American households. 73% of households in the US are managed by single moms or women who are the primary breadwinner of the family and because of this fact; women need to have a handle on how to become more money savvy.

We often hear that money is the root of all evil. I think that NOT having money is the root of evil. Here’s why…I was at home on a rainy Sunday afternoon and was looking at a program on T.V. called “Snapped”. This particular episode involved a woman who grew up being spoiled by her widowed mother. The young lady was an only child and stood to inherit her mother’s fortune. Now there is nothing wrong with that because parents are told to build an inheritance for future generations (Proverbs 13:22). How did this whole scenario go wrong? The young lady and her boyfriend plotted and killed her mother to get the inheritance sooner than she was entitled.

Now I know this is an extreme case, but I’m sure that you can think of other examples where the lack of money caused people to do desperate things.

Starting here and now, I want you to start thinking about where you are financially and where you want to be in 5, 10, 30 years from now. You can’t get there unless you know where you are now. We have all seen the infomercials where the advisor tells the client that she can’t afford that $200 camera and maybe she can’t right now, but I have yet to see that same advisor show her client a clear path to how to get there. Whatever path you start on it has to be sustainable and fun or it won’t work in the long run.

The lesson take-away this week is, start where you are, you don’t have to be rich to start building an inheritance for you and your child. Next week, we will share a plan to get started.

Financial Safety Net for Women – Part 2

Last week we discussed the importance of building a form financial foundation. This week we will cover the first step; pouring and solidifying the concrete. This step involves meeting with an insurance agent and/or a financial advisor so you can complete a survey entitled a fact finder (needs analysis). This fact finder will uncover where you are financially and where you want to be in the future. It will formulate a plan for your financial objectives and goals. Some of the questions on the survey are: 1) Where day you want to be in 5, 10, 20, 40 years? 2) Do you need long-term care coverage? 3) How much life insurance do you need? 4) How much money should you have in savings for emergencies, etc.

Women are especially vulnerable in planning for their financial future. Schedule an appointment with an agent or planner to get started building your foundation.

Financial Safety Net for Women – Part 1

We are starting a new series for women. This series will focus on areas that are of importance to women, their families and their businesses. Statistics has shown that if we aren’t already, most of us will be the sole person responsible for our financial security. A woman who is out of the workforce due to family obligations or illness will have a longer recovery period financially than her male counterparts. On average, it takes about five years to make up for every one year of absence.

We are all concerned about retirement and investments but to have a strong foundation we must start with protection. Our next blog will cover creating a financial safety net for women.

Disability Insurance is the forgotten insurance

The importance of auto, health, homeowners and life insurance is well known. But disability coverage, which replaces lost earnings if you can’t work, tends to be ignored — until you need it.

Government studies show that a 20-year-old worker has a 30 percent chance of becoming disabled before reaching full retirement age. Yet only about a third of employees in private industry have long-term disability insurance, according to the Bureau of Labor Statistics.

“It could be argued that the disability of a breadwinner is worse than the death of a breadwinner,” says James Hunt, insurance actuary for the Consumer Federation of America, “because the disabled person is still soaking up money.”

That’s why it makes sense to purchase individual coverage if you’re self-employed — or not covered sufficiently or at all by your employer.

A look at what you need to know about disability insurance:

Q: How does disability insurance work?
A: Disability insurance protects from a loss of income resulting from an inability to work due to an accident or illness. You typically receive disability checks starting three to six months after you become unable to work.

There are three sources of this coverage: The Social Security Administration, employers and private insurers.

— Social Security Disability Insurance is the bedrock protection against disability. About 153 million workers are insured by the program through FICA taxes. But it has a very strict definition of disability and it can take two years or more to be approved for benefits.

— Many employers offer disability coverage through a group plan, which pays a specified portion of your salary.

— Private insurance coverage is most often sought out by high-income professionals such as doctors and lawyers who have made a huge investment in their earnings potential; self-employed workers, and executives looking for supplemental coverage.

Q: Do you need to buy coverage if you receive disability insurance through your employer?
A: It depends whether you could get by on the benefit checks. A typical group plan replaces just 40 percent to 60 percent of your salary, up to a maximum $5,000 a month or $60,000 a year. And if the employer pays your premiums, the checks will be taxable.

Benefits can last for either a set number of years or until retirement age. Check your plan’s details closely. Company benefits have been steadily shrinking in recent years. Group policies often limit the duration of benefits to only two years if you can’t perform your job duties.

If your policy looks insufficient, ask your employer whether you can pay for additional coverage. Otherwise, consider getting extra insurance from a private insurer to extend the duration or bring the coverage up to 70 percent or 80 percent of income.

Q: Why can’t you count on Social Security Disability Insurance to cover your needs if you are disabled?
A: The average disability benefit is just $1,111 a month, based on payments by the Social Security Administration this month to 8.8 million beneficiaries. And you only qualify for it if you are unable to work in any capacity, not just at your chosen occupation. A list of conditions that are considered disabling is available by doing a search for “disability evaluation” at the agency’s website, http://www.ssa.gov .

Q: What should you look for in a policy?
A: If you have a highly specialized job or can simply afford to pay the premiums, it’s worth paying extra to have an “own occupation” policy. This coverage pays benefits if you are unable to perform the major duties of your own occupation. To trim some of the costs, it may be advisable to obtain “own occupation” coverage for one or two years and “any occupation” coverage after that.

The length of benefits is key, and will affect the cost of premiums significantly. Some policies pay benefits until age 65 or until your full retirement age for Social Security benefits, others for two or five years. Seek out a non-cancellable policy.

You probably also want a policy that will pay “residual” benefits, which will compensate for a decline in income if you are able to work at a new job that pays less.

Q: How much does disability insurance cost?
A: Prices vary based on age, gender, occupation, amount of coverage and health status. Check with a broker to get quotes from at least three different insurers.

For someone who does not have coverage at work, a plan with all the extras including inflation protection costs roughly 2 percent to 2.5 percent of annual salary for a man, and 3 percent to 4 percent for a woman. Women pay more because they file claims more frequently and for a longer duration than men.

If someone has coverage at work but wants earnings to boost benefits to 80 percent salary replacement, the annual cost is typically about 1 percent of the worker’s salary.

~ via Business Week

The New Preventive Care Benefits for Women began August 1, 2012

The eight new preventive care services that has become available to women free to charge (as summarized by HHS on HealthCare.gov), include:

■ Well-woman visits: This will include an annual well-woman preventive care visit for adult women to obtain the recommended preventive services, and additional visits if women and their health care providers determine they are necessary. These visits will help women and their health care providers determine what preventive services are appropriate, and set up a plan to help women get the care they need to be healthy.
■ Gestational diabetes screening: This screening is for women 24 to 28 weeks pregnant, and those at high risk of developing gestational diabetes. It will help improve the health of mothers and babies because women who have gestational diabetes have an increased risk of developing type 2 diabetes in the future. In addition, the children of women with gestational diabetes are at significantly increased risk of being overweight and insulin-resistant throughout childhood.
■ HPV DNA testing: Women who are 30 or older will have access to high-risk human papillomavirus (HPV) DNA testing every three years, regardless of Pap smear results. Early screening, detection, and treatment have been shown to help reduce the prevalence of cervical cancer.
■ STI counseling: Sexually-active women will have access to annual counseling on sexually transmitted infections (STIs). These sessions have been shown to reduce risky behavior in patients, yet only 28 percent of women aged 18-44 years reported that they had discussed STIs with a doctor or nurse.
■ HIV screening and counseling: Sexually-active women will have access to annual counseling on HIV. Women are at increased risk of contracting HIV/AIDS. From 1999 to 2003, the Centers for Disease Control and Prevention reported a 15% increase in AIDS cases among women, and a 1% increase among men.
■ Contraception and contraceptive counseling: Women will have access to all Food and Drug Administration (FDA)-approved contraceptive methods, sterilization procedures, and patient education and counseling. These recommendations do not include abortifacient drugs. Most workers in employer-sponsored plans are currently covered for contraceptives. Contraception has additional health benefits like reduced risk of cancer and protection against osteoporosis.
■ Breastfeeding support, supplies, and counseling: Pregnant and postpartum women will have access to comprehensive lactation support and counseling from trained providers, as well as breastfeeding equipment. Breastfeeding is one of the most effective preventive measures mothers can take to protect their health and that of their children. One of the barriers for breastfeeding is the cost of purchasing or renting breast pumps and nursing related supplies.
■ Interpersonal and domestic violence screening and counseling: Screening and counseling for interpersonal and domestic violence should be provided for all adolescent and adult women. An estimated 25% of women in the United States report being targets of intimate partner violence during their lifetimes. Screening is effective in the early detection and effectiveness of interventions to increase the safety of abused women.”