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Personal Finance 101 – Your Benefits Package At Work: The Extras

One of the most overlooked parts of an overall financial plan is the benefits package you receive from your employer.   Last week I reviewed the area of disability insurance and how to best protect your overall income.    Depending on the size of the company where you are employed, you will find many different types of unique benefits.   Each of these benefits can be easy to gloss over come open enrollment season, but analyzing your overall budget and how these benefits fit in with your plan can be paramount to reaching overall success.  Here are handful extra benefits you may have that should be examined. Legal Plan – A basic legal plan through your employee benefits package can cover many items including legal consultations, wills (including certain types of trusts), living wills, powers of attorneys, deeds, and potentially more based upon the type of overall plan.   If you carefully consider the years you may need these types of legal services, it ...

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Personal Finance 101 – Your Benefits Package At Work: Disability Insurance

One of the most overlooked parts of an overall financial plan is the benefits package you receive from your employer.   Last week I reviewed the areas of life insurance.    For younger employees, the area of income protection can often be far more important than the area of life insurance.   This week, I will cover how to analyze the group protection you have at work for disability insurance.  If your employer doesn’t offer this coverage currently, it should be at the top of your list to get yourself some individual disability insurance coverage.   Disability coverage can be some of the most confusing coverage to understand, and the real details about your policy are within the benefits manual you receive from your employer. You will generally have two types of coverage through your employer.   Your short term disability (STD) coverage will normally take effect somewhere from 0 to 14 days after your disability, and may last somewhere up to six months to ...

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Personal Finance 101 – Funding Your Buy-Sell Agreement

Part of any good business plan is an exit strategy if the unexpected happens.  A good Buy-Sell Agreement should anticipate certain unfortunate but foreseeable events, and make sure a fair and reasonable plan is in place. When a triggering event occurs, everyone should be fully comfortable and prepared to move forward with the plan. The most critical detail of the Buy-Sell Agreement to the company’s survival is how to pay the purchase price for a departing owner’s interest.  If the company or other owners do not have adequate assets, cash reserves, or credit available to fund the payment obligations, then they cannot fulfill their side of the agreement.  This isn’t good for anyone – the departing owner (or his estate and family), the company itself, or the remaining owners. Insurance. Since death and disability are two of the most basic triggering events in any Buy-Sell Agreement, life and disability insurance can be the most attractive methods for funding the payment ...

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Personal Finance 101 – Buy-Sell Planning: Trigger Events and Payment Terms For Buyout

The most fundamental detail of any Buy-Sell Agreement is defining what circumstances will trigger a buyout.  Buyout payment terms should be carefully tailored to each triggering event.  Here are a few common triggering events and some considerations for payment terms. Death. An untimely death is almost universally included in any Buy-Sell Agreement.  Despite being the worst of all possible triggering events, death is actually the easiest event to plan for in a Buy-Sell Agreement.  Life insurance policies in connection with a Buy-Sell Agreement allow an immediate source of liquidity to fund a buyout obligation without burdening the assets or ongoing cash flow of the business.  Given the immediate source of insurance proceeds, a death buyout often occurs as a lump sum payment within a certain time period after the death of the owner.  Immediate payment can also be important for estate tax purposes if the value of the business interest will be included in the deceased owner’s taxable estate and ...

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Problem – or a PROBLEM!

As I sit this weekend and read more about the oil spill in the Gulf, it becomes more and more apparent to me they really don’t have a solution other than drilling a relief well.  All the other pomp and circumstance they are doing right now is for our benefit so at least we will feel like something is getting done.  With advances in today’s technology, how could we get to this point?  Surely there was a contingency plan, right? Most of us would be just as guilty for lack of preparation in our personal lives.  Who has time to stop and assess?  Unfortunately however, what starts out as a small problem can quickly turn to a PROBLEM!  All of us have heard a story from a neighbor family member or friend, someone loses their job, they have medical issues, bad luck, whatever! When you are done reading this take 5 minutes and ask yourself the following questions: When was ...

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5 Financial Questions To Ask Yourself Right Now

With a roller coaster economy, high job unemployment, and increasing federal debt, this is the time to take stock and ask yourself some important financial questions to make sure you keep your financial house in order.  Here are 5 important questions to ask yourself now? Do I have an exit strategy with my investments? If the stock market has another free fall or your company stock takes a dive, how will you put some sort of cushion to secure those assets which have grown over the past year?  You should be asking yourself questions such as how far your money may go down before you exit the stock market, or how much it needs to make before you might take some profit off the table.  Learn from the ups and downs you saw in the early 2000’s and in 2007/2008. Do I have enough of a cash reserve? With job market uncertainty, you want to make sure you beef up ...

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Health Care Reform Details

I have been asked over the past few weeks on what the heath care reform will mean to you over the next number of years.  Here is a great chart put together by healthinsuranceproviders.com showing the details.  If you need a quote on health insurance, you can always go to oXYGen Financial Insurance Agency to get your FREE insurance quote. Related Insurance Articles – Life Insurance For My Children?, Do you need disability insurance?, Top 5 Insurance Policies To Avoid, Health Savings Account Limits For 2010, Be wary of “hypotheticals” in insurance policies! , Long Term Care Insurance . . How Does It Work? , Is a Health Savings Account the best medical plan option for you? oXYGen Financial, Inc. co-CEO Ted Jenkin  is one of the foremost knowledgeable professionals in giving financial advice to the X and Y Generation.  Unless sources are noted, the information is the opinion of the author. Ted Jenkin, CFP®, AAMS®, AWMA®, CRPC®, CMFC®, CRPS® ...

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Do you need disability insurance?

There are many types of insurance programs to manage these days. Yet, one of the programs most misunderstood by employees of companies and small business owners is the need for disability insurance. Since there are so many nuances of disability insurance, here are some key questions to ask yourself regarding your personal situation. What percentage of my income will you replace if I become disabled? At most employer programs it will be between 50% and 66%.  Will you cover commissions or bonuses on top of a base salary? In most cases, your employer will only cover your base salary. If you have a large bonus program or work commissions, you need to really review the fine print of your group policy.  What about 401(k) or other retirement contributions? Generally, this is not covered. The big question then is how will you continue to fund your retirement goals? Can the payout go up as my income goes up in the future? ...

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9 financial tips for Generation Y

9 financial tips for Generation Y. Perhaps not surprisingly, more than half of employees between 21 and 32 say that they're living paycheck to paycheck, according to a recent survey by insurer Metlife. Nearly three-fourths of respondents are concerned about making ends meet. Fortunately, you can get off to a sound financial start with these nine tips. ...

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