Lets Leave A Legacy Not A Loan

04/28/2021

It is a lot to read but very informative for you legacy builders. If you have any questions any thoughts any ideas just contact us by messenger. We will be more than happy to help in any way possible.

How To Build Generational Wealth

You may have heard the term ‘generational wealth’ and thought, ‘Wow, that sounds important'. But at the same time, you might have pushed it to the back of your mind because you have more pressing issues.
For instance, you might be focused on getting out of debt, saving money, or pursuing other financial goals. It may be that creating generational wealth is not on your immediate priority list while you tackle your current finances. But with that being said, you can still build it into your long-term financial goals.
Not quite sure what transitioning generational wealth means exactly? Don’t worry! I'll be sharing exactly what it is and how to build it for your family.

So, what is generational wealth?
It is basically wealth that is passed down from one generation to the next. You may also hear this called family wealth or legacy wealth.
If you are able to leave something behind for your children or grandchildren, then you are contributing to the growth of generational wealth in your legacy.

Of course, you may leave many things such as good memories and healthy genetics behind for your family. However, I'm specifically referring to the financial resources that you are able to leave behind.
This wealth can come in many forms such as real estate assets, stock market investments, or a financial education to carry forward into the future.

Why is generational wealth important?
If you are starting from scratch with your finances or starting out with a large debt burden, then you should realize the importance of generational wealth.

What if your parents had the ability to fund your college education? This single action could have a tremendous effect on your financial future. Instead of playing catch up to pay down your student loan debt, you could be saving for your first home or your future retirement.
As you continue your personal finance journey, you have likely discovered that it is not always easy to recover from your financial mistakes. What if your parents had been able to offer solid financial guidance as you stumbled your way through? It could have prevented spending beyond your means or started you on a budgeting habit much sooner.
The more you think about your own financial life, the more you realize how important generational wealth can be. If you have kids or plan to have kids, then you may start to think about how their financial futures will play out. Imagine how differently things could turn out if you take the time to educate them on personal finance and set up vehicles to add security to their financial future now.

How to build generational wealth
The concept of building generational wealth is easy.
You simply have to acquire assets or save cash that you don’t intend to spend in retirement. Then you pass those assets along to your children when you pass away.

This sounds easy in concept but can be difficult to put into practice. If you are struggling to build your savings, then saving for the next generation can sound overwhelming. And that is completely understandable!
It is critically important to nail down your own retirement savings plan and other financial goals before you start to save for generational wealth. Once you have a handle on your current finances to fund your golden years, then it is time to start saving beyond that.
How should you start to save for generational wealth? Here are some of the best ways to start preparing to leave a legacy of wealth behind for your children and grandchildren.

1. Invest in the stock market
The stock market can be a great way to build wealth over the long-term. If you are aiming to build generational wealth, then it is a great option because it has the potential to continue growing for decades.
Investing in the stock market might sound scary if you’ve never tried it. However, it is an important way to build wealth in your lifetime and beyond.
As a stock market beginner, the best place to start is with low-cost index funds. These funds can offer low fees and long-term growth. If you want to learn more about stock market investing, we have a course to help you get started.

2. Invest in real estate
Real estate is another major way to build wealth for the long-term. With the potential for steady cash flows in addition to increasing values over time, real estate can be a reliable path to wealth.
The idea of building a real estate empire can be intimidating. But it doesn’t have to be! You may have already waded into the world of real estate through the purchase of your first home. If you continue to buy properties one at a time throughout your life, then you might be surprised at how quickly your real estate portfolio can grow.
Consider this as an option for building wealth for your kids.

3. Build a business to pass down
Family businesses have the potential for great success. More than 30% of family-owned businesses transition to the second generation. Imagine being able to hand over the keys of a successful business to your children.
Although not all family businesses make it to the second generation, it is possible that yours can. If your interests and abilities align with your children’s, then it is very possible they will want to take over the business you build.

For a great chance of a successful transition, you should include your child in the business from a young age. They need to know how the business operates and how to successfully continue in this business.
Don’t expect them to take over if they show no interest in the business you’ve built. If they are unable or unwilling to take over the operations, then you could consider selling the business to fund generational wealth in another form.

4. Take advantage of life insurance
Life insurance provides the opportunity to protect your family in the event of your untimely death. Without your income, your children might be forced into less than ideal financial circumstances.
If you make the effort to invest in life insurance now, then it could prevent financial tragedy for your children. Plus, they will already have enough to cope with if they lose you.

5. Invest in your child’s education
In many cases, education can provide a way for your children to support themselves. With a college degree, many frequently have the opportunity to pursue high paying jobs that can help them navigate their own finances.
Anyone with an education will always have that education. Although other things in life can come and go, no one can take away your education. If you have the ability to help your children make it through college without any debt, then you are helping to set them up for a brighter financial future than many of their peers.
In 2016, the average student loan debt for college graduates was $37,172. It is possible that the number will climb even higher in the future. Imagine the amount of financial pressure you will be able to lift from your children’s shoulders with the ability to pay for their education.

6. Teach your children about personal finance
It is estimated that 70% of families lose their wealth in the second generation. And 90% lose it in the third!
With statistics like that, it can seem pointless to save for a legacy of wealth. However, in many cases, the loss of generational wealth can be prevented through financial education. After all, it is easy to lose generational wealth if your kids have no personal finance knowledge.

That would be like asking your child to maintain a classic antique car after you pass away without teaching them any mechanical skills. It is likely that the car would eventually break down.
In a similar way, if you teach your kids nothing about personal finance, then it is likely the wealth you leave for them will dwindle throughout their lifetime.
Since you are interested in passing on family wealth, then you likely have a fairly good understanding of personal finance. Make it a priority to pass this knowledge down to your kids. This knowledge will be the best way to build and protect generational wealth.
There are many ways to broach the topic of money with your kids. You can buy children’s books about money, teach them through games, or show them by allowing them to listen as you talk through financial decisions. You can even help them to set up their own bank accounts from a young age to instill the importance of saving for the future.

How to pass on generational wealth
After you build the assets, you’ll need to create a plan to pass them along to the next generation. Here’s what you will need to do to ensure a smooth ride for your assets as they transition to the next generation.

Create an estate plan
An estate plan is absolutely essential to securing an easy transition of your assets. The larger your estate, the more complicated this plan will become. At any stage, I would recommend consulting an attorney about how to create your estate plan.
The plan will vary widely based on your goals and assets. With the expertise of a legal professional, you can craft a plan that will allow for your assets to move through to your kids with minimal headaches.

Write a will
A will may be included in your estate plan but it is important to create one even if you don’t have an estate plan. The will should include your exact wishes. The more specific you can be about your plans for any assets you have accumulated, the better.
Without a will, it is not uncommon for things to get ugly between surviving family members. Emotions are high because they’ve already lost you. You can prevent a lot of ugliness and financial trauma with clear guidelines in your will.

Set up custodial accounts
Custodial accounts are important vehicles for any financial legacy that you hope to build. Custodial accounts are investment accounts that you can control for your children until they are no longer minors. In most states, they receive control of the account at age 18, but in some states, they will have to wait until they are 21.
You can fund these accounts for your children for future financial goals such as paying for college or buying their first home. However, they may have to pay taxes on this money as they withdraw it.
Another option is a 529 plan. It is a tax-advantaged savings account that is tied to paying for your child’s education costs. These plans are state-sponsored ways to efficiently save for your child’s future.
There are pros and cons to each option, but you’ll need to determine which is best for you and your family.

Name beneficiaries for your accounts
A simple way to ensure that your accounts pass easily to the next generation is to name them as beneficiaries on your accounts. In most accounts, you can name a beneficiary.

If you were to pass away, the beneficiary would receive the funds with minimal effort. It may only take a few minutes to add your intended beneficiaries to your accounts but it can save countless hours for your family later on.

The bottom line
Building wealth to last for generations is no easy feat but it is an admiral undertaking. After you have your own financial situation under control, safeguarding your family’s future is the next step.
Take the time to implement a wealth-building strategy that works for your family. Not everyone wants to invest in real estate or build a business, so find something that works for your situation.
Whatever strategy you choose, make sure to pass down your financial know-how to your children. Armed with the personal finance knowledge you can provide, your kids will already be one step ahead of the game as they make their way into the world

04/22/2021

Life insurance is meant to protect your family’s financial security when you die. But having just any life insurance policy doesn’t cut it. A policy lacking in coverage or a long enough term length can leave your loved ones struggling financially after you die.
Finding the sweet spot between the right amount of life insurance coverage and term length makes all the difference when it comes to your family’s financial assurance. Read on to learn about what you can do to make sure you're purchasing a life insurance policy that adequately protects your loved ones.

KEY TAKEAWAYS
* A majority of Americans do not have enough life insurance coverage or a long enough policy term length to adequately protect their dependents from financial hardship if they die
* The amount of life insurance coverage you purchase should account for the income you provide, any debts and liabilities you have incurred, and end of life expenses
* While a shorter-term length is cheaper than a longer-term length, purchasing a new policy later can result in costlier premiums or a coverage gap

What can leave you underinsured
Because your life insurance coverage amount is an income replacement, you want to make sure that the amount that is paid out after your death is proportionate to the financial support you offered your loved ones when you were alive. But a majority of Americans who have a life insurance policy don’t have enough coverage to sufficiently support the people their life insurance policy is meant to protect.
Low coverage amounts
Most people should purchase a policy that offers coverage of at least 10 to 15 times their income, but this amount can be even higher based on individual circumstances. But according to Policygenius research, approximately three-fourths of people who have an active life insurance policy don’t have enough coverage to adequately support their family after their death, and according to a recent survey by Life Happens and LIMRA, four out of 10 households would be unable to pay immediate costs if the primary breadwinner passed away.
Too short life insurance term length
Even though a 10-year policy is going to cost you less than a 20-year policy now, a shorter-term length policy could still end up seriously costing you.
For starters, the cost of purchasing life insurance increases on average by 4.5-9% every year you age. So if you plan on purchasing a 10-year policy now and then another 10-year policy once your original policy’s term length is up, you’ll see an exponential amount for life insurance as you get older. Additionally, a change in your health could lead to even higher than expected premiums or complete ineligibility for life insurance altogether.
Alongside this, your life insurance policy should last as long as your debts and should cover your future anticipated costs. If you have a newborn whose college tuition you plan on paying, a mortgage of 30 years, or any other long-term foreseeable costs, a short-term policy can leave your loved ones vulnerable to financial hardship if you pass away.
Wrong type of life insurance policy
Even with the best of intentions, purchasing the wrong type of life insurance policy can pose major risks to the financial security of your loved ones. Some life insurance policies are too expensive to maintain or don’t offer a high enough coverage amount to account for necessary expenses.
Whole life insurance lapses
While a whole life insurance policy may seem attractive — you don’t have to worry about your term length running out and losing life insurance coverage — a whole life insurance policy’s exponentially high costs often lead to the policy lapsing and a lack of life insurance coverage anyway.
Whole policies are five to 15 times more expensive than term life insurance policies, which leads to 30% of whole policies to be given up within the first three years and 45% of whole policies to be given up within the first ten years.

Final expense life insurance is a small coverage amount
Some people obtain coverage for their final expenses, such as funeral costs or final medical bills, by purchasing a final expense life insurance policy, though it tends to be more expensive than traditional term life insurance policies and has limitations on the coverage amount. A final expense policy that doesn’t pay out enough can still leave your family footing the bill.
Group life insurance isn’t enough coverage
Some people rely on employer-sponsored life insurance for their life insurance policy, though for the most part they are inadequate and the median amount of coverage provided is a maximum of $250,000. If you make an annual salary of $100,000, this provides less than three years of financial support to your beneficiaries, or the people who receive the life insurance pay out.
Relying on employer-sponsored life insurance is another scenario that runs the risk of a coverage gap. It’s not portable, so if you change or lose your job you’re no longer covered.
Employer-sponsored life insurance can be a good supplement to a life insurance policy that you already have in place, but it should rarely be your only form of life insurance coverage.
What happens if you don’t have enough life insurance coverage
The consequences of a life insurance policy that doesn’t offer sufficient support can be devastating for your loved ones. While the long-term impact on larger expenses might be more apparent, they could also face financial hardship in their everyday lives almost immediately.
Can’t keep up with everyday expenses
You want your life insurance policy to provide for your family’s basic needs. A repercussion of too low of a coverage amount is that your loved ones could lose cash flow imperative to their livelihood. Without your income or an adequate income replacement, your dependents could struggle to cover food, bills, and all other necessary expenses.
Loss of long-term financial plan
Distinguishing the length of your life insurance policy necessitates anticipating future costs. If you have a 30-year mortgage and a 20-year life insurance policy, you are once again creating a scenario where your dependents may either end up paying your debts or losing part of your estate to a debt collector.
Below are some of the average costs that someone might see in Ohio, which has a cost of living that is 11.1% less than the national average.
* Average mortgage - $122,765
* Average annual cost of college tuition - $122,765
* Average cost of raising a child until 18 - $206,793
* Median salary or income replacement - $206,793
* Average annual cost of retirement - $48,780
Even with a below-average cost of living, you would need at least a $1 million dollar life insurance policy to ensure your family’s financial health for 10 years after you die.
Inability to pay for final expenses
End of life expenses are costly and can come to roughly $7,000 — sometimes costing as much as $10,000. While you want to ensure you’re leaving behind enough of a life insurance coverage amount to compensate for the loss of your income, a low coverage amount might be prohibitive when your family plans your funeral.
Debts and assets might be seized
Mortgages, loans, and any other financial liabilities you have incurred are going to impact how much life insurance coverage you’ll need — especially if you have any loans that have been co-signed. If you die and your life insurance policy doesn’t offer enough of a coverage amount to pay off your debts, they will be liable for any co-signed expenses.
Even if you are the only borrower on a loan, not having enough life insurance to cover your debts can have major repercussions for your dependents. Often, outstanding debts have to be sorted out in a probate court. If your estate doesn’t have enough money to pay off the debt, the court could sell your belongings — which could include the house that your dependents live in or implicate any other part of your estate that they rely on.
How to make sure you have enough coverage
The best way to ensure that your loved ones aren’t struggling financially after you pass away is, of course, to purchase the right policy. There are a few key ways to ensure that you’re getting a life insurance policy with optimal coverage and term length for your individual circumstance.
Policygenius life insurance calculator
If you’re considering something along the lines of $500,000 policy for the cheaper premiums, it may not offer the type of financial support your family needs based on your income. If you make $200,000 a year, then a lump sum payout of $500,000 may only last your beneficiaries a little over two years, not accounting for inflation and unexpected expenses. The Policygenius free insurance coverage calculator can help you determine exactly how much life insurance you need.

If you have read all of this send me a message so we can chat

04/22/2021

https://www.fool.com/retirement/2020/02/10/heres-why-you-should-avoid-whole-life-insurance-li.aspx

It may seem like a good idea -- but there's a better, more affordable way to protect your loved ones.

04/21/2021

https://youtu.be/c4lnaZJKGvU

Sign up for Term Life Insurance today! https://goo.gl/LFpCEjDid you miss the latest Ramsey Show episode? Don’t worry—we’ve got you covered! Get all the highl...

04/18/2021

How To Choose Term Insurance

To choose the right term insurance plan for securing your family’s future, you need to consider many factors. It is important that you opt for the right term plan, since the life insurance cover can act as a financial safety net for your family. There is no telling what can happen in life. Uncertainties and emergencies may crop up when you least expect them. With the possibility of such contingencies being very real, it is only natural that you will want to safeguard your family from the troubles that follow such incidents.

Here is where term insurance can prove to be very valuable. With the right term plan, you can ensure that your spouse, children, parents, or other dependents are adequately provided for, even if you are no longer around.

Term insurance benefits are many and varied. The term insurance premium charged for your policy is generally much lower than the premium charged for other traditional life insurance plans. As a result, you can obtain a relatively higher insurance cover for relatively lower costs.



Factors you should consider while selecting term insurance for yourself


Before you buy term insurance for yourself, there are many factors that you need to consider. If you are wondering about how to choose term insurance that is just right for you, read on to find out.

• The needs of your family
Your family’s needs and life goals play an important role in determining your choice of a term plan. The needs of your dependents will evolve as they go through various life stages. Your aged parents may require financial support to meet their everyday expenses post-retirement. Your children’s life goals may include getting admittance into a good university. Therefore, when it comes to learning how to choose term insurance, one of the first things you should consider is the amount of sum assured that your family members will require to carry on in your absence. Ideally, to determine this, you must factor in the number of dependents in your family and their current and future needs.

• The debts and liabilities in your name
You may have opted for financing and taken a housing loan or a personal loan. In addition, you may now be repaying the loan with your income. However, in case anything untoward happens to you, your family may be unable to meet these obligations. The term insurance benefits they obtain from your policy can help them tide through these times.

Before you invest in a term policy, you need to consider all the debts and liabilities in your name. The plan you choose must provide adequate cover to help your family repay your debts in case you are not around. This way, you can ensure that the surviving members of your family do not have to suffer the burden of EMI repayments.

• The life insurer’s claim settlement ratio
The life insurer’s claim settlement ratio is another important factor to consider when you are learning how to choose term insurance. This number essentially indicates the number of insurance claims paid by the life insurance company in proportion to the total insurance claims they received. A higher claim settlement ratio is a good sign, since it means the insurer honours their end of the insurance contract. While you are at it, you could also look into the financial soundness of the insurer and their solvency ratio, so you can get a better idea of whether the insurer is likely to pay the benefits to your nominees promptly.

• The tenure of your plan
There are two main reasons to consider the tenure of your plan when you are selecting term insurance for yourself. Firstly, it helps you ensure that your family members can continue meeting their life goals even if you are not around. Secondly, it helps you make sure that you can pay the term insurance premiums regularly and on time.

If the tenure of your plan overlaps with the years during which you are earning a steady income, it becomes easier for you to pay your term insurance premiums. This, in turn, ensures that your policy does not lapse, so your dependents can reap the term insurance benefits as per the terms of the policy.

• The mode of purchase
To know more about how to choose term insurance, you should also consider the mode of purchase. Some plans may be available only offline, while others may be available for purchase online. In recent times, online term plans are being increasingly preferred, since they are more affordably priced. Buying term insurance online also makes it easier for your nominees to raise a claim in the event of your demise, since it can be done through online channels directly.

So, before you select a term plan, figure out if you are more comfortable buying online or offline, so you can choose your term insurance policy accordingly.

• The inflation factor
When you select a term insurance plan for yourself, you will need to determine the right amount of insurance cover. To do this, many people only factor in their family’s needs and requirements based on their life goals. However, you should not stop there, because if the inflation factor comes into play, an amount that may be adequate now may not be sufficient 10 or 20 years later.

By considering inflation, you can determine the right amount of coverage needed to protect your family’s future. This helps you select adequate sum assured for yourself and your dependents.



Conclusion


Choosing the right term insurance plan is important because it can help your family meet their life goals without any trouble. With term insurance premium being affordable, it is easy to purchase a plan even if you have only just begun your career. In fact, it is advisable to buy a term plan as early in life as possible, so you can safeguard the future of the dependent members in your family.

Now that you know more about how to choose term insurance, you can go ahead and compare different types of term insurance plans to find the right option. Ensure that you consider the factors discussed before selecting a term plan, so you can make an informed decision.

04/18/2021

As a newly married couple, you would be excited about starting your life together. There is a world of opportunities out there for you, now that you are a team. While it is exciting to embark on this