Policyholders with Nacolah Life or North American Life Insurance based in Illinois may want to be wary when it comes to holding their policies. While there may be many insurance companies that are on the straight, this is one that I wouldn't trust anyone's life on. Just remember that one way in which insurance companies generate their profits is when policyholders pay continuous premiums but never file a claim. Or perhaps the policyholder dies but the cause of death is excluded due to a nondisclosed line item change in their policy. One of the more common tricks is when the insurance company stalls in making policy changes when determining whom can access your account records such as an executor. So that if a policyholder becomes unexpectedly incapacitated but is still alive, there's a chance the policy expires because family or friends cannot keep the premiums up to date because the insurance companies uses the privacy and confidentiality laws to prohibit non-account holders from accessing the basic information.
Colonial Life and Accidental Insurance based in Columbia, South Carolina is another I would be wary of as well. While I have no specific problems with this company, the most recent visit by their sales agent at work nearly prompted me to file a claim with our state's insurance board. In short, he was snotty, arrogant, and pretty much said, "I think you're making a big mistake not having one of our policies." Now that I have had a chance to think about it, the next time I see him, because we see him once a year, I will tape record our meeting and hope he tries the same stunt so that I can file an unlawful practices claim with the state governing board. And yes for the record, he was "snooty" too.
Kiplinger's Personal Finance had an article that will probably generate a lot of controversy but the saying "you're not as good as gold" would apply. If you are truly serious about someone for marriage (and when I mean marriage its between one man and one woman), if the relationship is truly open, here are 10 questions to ask one another:
1) Where do they want to be in five to ten years? Supposedly things such as what part of the nation to reside, going back to school, starting a business would be part of this answer.
2) What are each person's assets and liabilties? Pre-nuptials are a difficult topic, but it's a necessary topic because if you can't talk about finances now, what will it be like after several years of marriage.
3) Having both joint and separate bank accounts. This is necessary since many couples are the proverbial opposites attract. One's a spender, and the counterpart is a saver. Have a joint account to pay all the common bills (housing expenses, property taxes, insurance, meals), but each person should have a separate account to have a little fun, say no more than 5% of each person's paycheck, so that they don't have to explain to one another why she bought a pair of shoes at Jimmy Choo's and why he bought another power tool at Lowes.
4) Investment selections. Generally, I prefer that each person makes their own decisions with regards to investments. If the other spouse requests assistance then give it freely. However, if they do not ask, at the least find out whether they are beating the market averages. If they are ahead of the market averages, then there's no need to worry. When one spouse is making the majority of the decisions, it is their responsibility to assist the other on sharing their knowledge with the other in case one spouse becomes financially incapacitated.
5) Having a budget. Each spouse should have a budget. It does not have to be a line item down to the penny budget, but in short, "You have X to spend for 31 days, you can spend anyway you wish, but after that nothing." If you spend over that amount, the overage is reduced by the following month. Since Housing, Taxes, and Meals eat up most of the budget, theoretically that should make things easy. And no cheating by using Credit Cards, Debit Cards, credit lines, home equity lines, or anything related to credit.
6) Who's responsible for paying the joint bills and tax returns? One person should take responsibility and the other should audit it to learn how the numbers were calculated. When you are married, you cannot claim ignorance if your spouse makes a computational error on tax returns. Your signature on the tax return states you are equally subject to your spouses' penalties or errors. The mathematics required to learn this is 4th grade level. And you do not need anyone from H&R Block, Jackson Hewitt, or any public CPA firm to tell you how to use addition, subtraction, multiplication, or division. At worse, there's always the calculator you can purchase at 99 cents stores.
7) Risk tolerance. This goes above with question four. Allow each person to take some risk, but make sure that the overall portfolio total net worth is increasing each year.
8) Insurance. This is mainly to make sure you are not double paying for the same coverage. Make sure the basics such as auto liability, health, dental, vision, homeowners (rental) are covered. Then go through each policy to see you are truly getting the best value for each of you. You noticed I didn't mention life. Life is only needed to cover a surviving spouse without a means of supplemental income. Almost any other reason is salesman speak. Don't fall for it.
9) What does each person's credit report look like? Any bankruptcies? If he or she is your equal, their credit report should be relatively similar to your own. Once you are married, both the benefits and the skeletons of the past become your own.
10) What happens if they become in debt? While this would hopefully never occur, there's likely two reasons for debt: first time purchase of a home, or unexpected medical expenses. You'll want to know their reaction to this hypothetical situation to know if they have the will to handle something this stressful.
This doesn't cover everything but it's an interesting financial snapshot of trying to figure out if the person you're seeing at least in financial terms is the right match.
Subscribe to:
Post Comments (Atom)
No comments:
Post a Comment