Four Rules Of Thumb That Are Thumbs Down

For many years I have seen articles galore in the major magazines giving consumers “rules of thumb” about making financial decisions.   In a society today where we want to get all of our information in sixty seconds or less, many of these magazines can talk one week about five dollar meals to make and then the next week discuss major financial decisions to make in your household.   I’ve never really been a big fan of “rules of thumb”, so here are four major financial “rules of thumb” that I am simply thumbs down on when it comes to making smart money moves.  Rule Of Thumb #1- 2% Difference In Interest Rate To Refinance –   Many popular magazine and newspaper articles will suggest that you generally shouldn’t consider refinancing unless the difference between the new interest rate and your old interest rate is 2%.    This “rule” makes very little sense to me. What you want to be considering are a handful ...

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Personal Finance 101: Generation X Series – What Kind Of Term Insurance To Buy?

Generation X is classically defined at people born between the years 1965 and 1979.    Pretty much those of you in your early 30’s to the mid 40’s.  However, having given personal financial advice to thousands of people, I can tell you that many of you who were born 1960 to 1964 fit within the Generation X type of financial and personal attitude.   Since I am 42 and have had a good deal of financial success, I’ve noticed some big mistakes that I see my generation making with their money and how they think about money.    This week I wanted to discuss what kind of term insurance to buy. One of the questions I’m getting a lot from Gen X’ers as of late (especially those recently married in their late 30’s/early 40’s is around buying term life insurance.   Many people seem to be confused around their options and how they can buy the protection.   Before you purchase life insurance, make sure ...

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

One of the most overlooked parts of an overall financial plan is the benefits package you receive from your employer.   Two weeks ago we talked about health insurance and the decisions that you should be thinking about within your overall benefits package.   Life insurance is an election that you will have to make every year within your employer’s benefits plan.   I have found that often people don’t ask themselves the tough questions when it comes to this election, nor do they understand what the coverage will take care of in the event of a premature death in the family. Remember, that your overall life insurance election will generally include individual group life insurance, spouse/partner life insurance, children life insurance, accidental death and dismemberment insurance, and sometimes a group universal life insurance option.   Understanding the nature of what these cover and their overall portability are a critical part of making sound financial decisions. How does my group term life insurance work? ...

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Top 5 Insurance Policies To Avoid

Doesn’t it seem like there is always an insurance decision to make? Whether it is from a new purchase you make, a decision at work, or someone calling you to buy something over the phone, insurance decisions are being made every other month in our financial plans. It is often confusing to figure out which insurance programs make sense, and which is just a waste of money. While hindsight is 20/20, here are five insurance policies you want to avoid in the future. Mortgage Insurance– When you buy a new home, you will typically get a mailer to buy an insurance policy that will completely pay off the mortgage upon your death. If you are reasonably healthy, buying a level term insurance policy through any of the major insurance companies will often be much cheaper than buying this type of insurance. Wedding Insurance- Isn’t there a big problem if you are buying insurance in the event your wedding doesn’t happen? ...

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