Tuesday, February 22, 2011

Life Insurance: Need vs. Financial Discipline

In my professional career, I help people.  The biggest way I do that is through making sure that every individual knows some things about life insurance.  I want to be sure they know:
1 - No one likes life insurance.
2 - Everyone needs life insurance.
3 - There are different kinds of life insurance.
The first one may seem odd to say coming from me, but it's true.  It goes hand in hand with #2 and it becomes a "necessary evil".
Two of the main questions I get from people with regards to life insurance are, "What are the different kinds of life insurance?" and "What kind of insurance do I need?"  As you can imagine the first one is pretty easy for me to explain but the second question gets fairly personal.  The only way I can get the answer is through asking some personal questions and getting people to see how each kind of life insurance is there to fill a need of some kind.
Throughout the fact-finding process, many time it's uncovered that people have taken some time to listen to financial advisors, like Dave Ramsey, to help them decide the approach to take that makes the most financial sense.  I can applaud their desire to make this move and it usually signifies a person who is looking to get something for themselves and their family that makes insurance sense and financial sense.
Fortunately I am aware of Dave Ramsey's main points on life insurance and I try to be responsible to my client as well as not offend Dave and his concepts for wealth management (which I appreciate very much).
The financial advisor has done their homework and they understand that term life is inexpensive and that whole life is more expensive.  That's the easy part.  The next thing they want you to be able to do it look at how much life insurance you need at that given time.  Now, the way the financial advisor sees it is that a person should be able to take that amount of death benefit and do the math to see what a whole life type policy would cost and then compare it to a term policy.  99% of  the time, the term policy is substantially less expensive.  The financial advisor explains why they only need term life and that what they should do with the money they are "saving" by not getting a whole life option is to invest it into a savings account or something so that when the term life expires, they no longer need to purchase life insurance because they have funded their own death benefit with the savings account they started.

The concept is brilliant and I agree totally.  However, the snags come in a couple of areas:
1 - The client may not be as committed to this savings as they may have led the advisor to be they were at the time they were meeting.  It never fails.  We get our finances in order and we're excited that we can see a positive turn in our debt to income ratio.  We see ourselves finally taking control of ourselves and we commit to do better from that moment on.  The reality sets in and the realization of life steps in a throws a big expense at us we were not expecting.  Maybe we had time to squirrel away money for our grand plan, but when this unexpected thing happened we reached for our cash.  That savings plan was used to handle the "rainy day" and came in handy but now we're down to $0.00 and we start all over again.  The plan we laid out has just taken a hit and we're behind a big 8-ball.  The time for our term insurance to expire comes to an end (20 or 30 years later) and we realize that we did not self-fund our insurance like we had planned because life happened.  Our intentions were good but our reality set us back.
2 - No one can tell you your last day (except God).  We all want to believe that in 20 years we could accumulate enough money to fund our own burial and final expenses, but does anyone really know what that amount is?  Right now, in my state, the average funeral cost is $12,000.00.  That number will not get smaller as land for cemeteries will be depleted making it more expensive due to costs.  The reality of term life insurance is that it's only good if you die in the term you purchased it for.  Chances are that you are more likely to outlive your term life insurance and then you have the knowledge that you spent all that money and it's gone.  The naughty little secret of life insurance is that the insurance carriers all have an idea (based on research and averages) how long you will live.  Why do you think term life is so inexpensive?  If every financial advisor who ONLY focused on term life could tell their clients when they were going to die, then we could all buy term insurance for the number of years we would need and call it a day.
It's different for everyone, but the best bet is to look at both sides of the coin and NOT overspend.  Term life insurance is there for the times in your life where your dying prematurely could seriously effect a family or property.  The whole life option is more likely to be what we die with.  My advice...when you have need of life insurance it to try and mix it up.  Just like with investing, don't put all your money in one thing.  Fill the momentary need to leave larger amounts with term life. Do this when leaving those larger amounts makes sense. You also should  think of the time long past those need years and have something waiting for you and your loved ones when the term life insurance expires (because no one wants to pay rates at the end of a term...trust me) with a whole life-type option.  If you do this early enough in life, your expenses for life insurance are kept in check and you are even likely to still be able to save something for a rainy day.  Also, since whole life does accumulate some cash value, if that rainy day is more than you have you may be able to borrow from the funds you have still accumulated through the whole life insurance.
Please understand, everyone is different but the basic rules should still apply with life insurance.  The key is that whenever your final day is that you have money for your final expenses without the family you left behind having to take out a loan or "pass the hat" at your funeral.  It's YOUR final day...don't make someone else have to pay for it.
If you have any life insurance questions, comments, or needs please feel free to email me at gene@generamsay.com.  I'm an email away.

Saturday, February 12, 2011

Christina Aguilera and Super Bowl "Whoopsie"...My Take

OK, I have been asked by countless people my thoughts on the Christina Aguilera "boo boo" while she sang the National Anthem before the Super Bowl.  I've been asked by football fans, friends, and even had debates with my professional musician friends.  I hope to answer everyone here and put a period at the end of this "mishap".
 - I will state this before I begin...in preparing to write this I asked some others their thoughts on it.  The majority had no idea she even missed a note and most enjoyed it.
First let me say I am a professional musician, I am a football fan, and I do believe that Christina Aguilera is a vocal talent like no other today.  With that said...let me address the basic question and answer.
The question always approaches me simply..."So, what do you think about the Christina incident at the Super Bowl?"  My simple answer is that I completely and totally back her and her performace of the National Anthem.  Now, when I gave that opinion freely to some friends of mine I was asked if I was crazy.  So I re-evaluated my stance.  After carefully considering the possible angles of how people viewed this I still came to the same overall conclusion...she did a great job and I'm very proud of her.  Now I will explain.
I was looking forward to hearing her sing since I first got the news she had been asked to.  It was going to be a highlight for me for Super Bowl Sunday.  I will say, as she started I saw something in her eyes that told me this could go wrong (almost "deer in the headlights"), but as she started to sing I felt myself right there with her cheering her on.  Each note came out in perfect Christina style and I appreciated her interpretation.
 - Let me pause for a second to address the "purists" who beat her up so mercilessly online.  I get your point.  You want to hear the "Star Spangled Banner" in it's purest and most legitimate format.  Some of you even suggested taking singers out of it altogether and just have a combination of the military bands play it with the pride and power we know they can.  I get it.  I play military funerals all the time and to "jazz up" Taps would be a travesty.  However, in this venue and on this stage of the Super Bowl and the person singing being considered...you knew it was coming.  Don't act shocked and please don't beat this amazing talent up for her creativity and her ability...which is far superior to most anyone making the negative comments.  Leave armchair quarterbacking to the football game and leave the musical talent alone.
Now, back to my post.  By the end of her rendition I was in tears, as were many on the sidelines and in the stands.  I feel she did her best job and I was happy for her.
Then the posts started and the media latched on to her "whoopsie".  It was at this point I had no idea myself that she had even messed up.  That tells me one thing...she was in the middle of the grandest performance of her life...she missed lines...and still sang with the passion and power the song deserved.  Lesser artists would have bailed on the live stage or started over.  So, I replayed the video that was posted and sure enough..."O'er the ramparts we watched were so galantly streaming" had been replaced by a mix of words that really did not belong together.  I heard it and I thought immediately, "Hmmm, even the best can get a little emotion boggled in a big moment."
However, the media was less than kind and they continued to smash her for her "mistake".  The more they picked, the more upset I got.  Here's where my musical education background and love for people who truly love and appreciate music came out.  I backed her even more, and here's why:
1 - She sang it LIVE.  She did not rely on a recording for "safety".  Those who would compare previous Super Bowl Anthem performers have no comparison because it's not there.  In fact...ACCAPELLA and LIVE.  Double whammy few could even boast wanting to attempt.
2 - She dressed with class and humility.  We have all seen Christina migrate into her "Diirty" girl persona.  Even her songs lend themselves to being less than worthy of even a primetime spot.  However, she chose an understated black suit...no bling (except on her shoes).  This tells me she honored her position and what she was asked to do.  It also tells me that she was telling the world, "It's not about me".  Who can't appreciate that?
All-in-all, she was great.  Sure, she needed to acknowledge her mishap, but her response was just what I felt it would be.  She stated she got caught up in the moment and lost her place.  So, my third reason is...
3 - She acknowledged her flub and had the most legitimate and reaosnable reason any of us could hope for.  Being a musician, I TOTALLY understand that.  Again, when I play Taps at a graveside I get one shot to honor the fallen.  Lots can go wrong and there are variables even the most seasoned could not be ready for.  Stuff happens in live performances.  For those who want to beat up Christina, go on over to youtube and search for JFK Taps.  One man...military and professionally trained musician.  Largest stage of his life.  24 seemingly simple notes.  He splits one and people call it "emotion".  OK...then let's use the same logic people.
I looked at this from every angle and from every position I could.  I still end up standing right next to Christina and thanking her for a gutsy job well done.  Had I been right there I may not have even heard the mistake even then, but had I...I would have been right there to tell her, "It's OK...it happens."
That's my take on Christina and I can't wait to hear her sing again anywhere and anytime.

If you missed it, here she is...doing her best...

Friday, February 11, 2011

Success or Significance?

I recently started reading a biography about the great coach Lou Holtz.  Amazing coach and an amazing man.  He has been a mentor to thousands, I am sure, and I am certain he will have another fan after I finish his book.  I was just a few pages in when he hit me with this thought provoking statement...
"Are you striving to be successful or are you striving to be significant?"
After reading this over and over and letting it sink in, I pondered the broad meaning and immediately evaluated myself.  He goes on to say the obvious that success last while you're here or for the moment, but significance can last multiple lifetimes.  It kind of goes along with leaving your legacy and what kind of legacy you will leave.
Here's my take on this.  Success is something many of us strive for.  I get up every morning hoping I can be successful in my business and my relationships with others.  I want people to look at me and think success.  I have been successful in many of the endeavors I have partnered myself with but guess what...eventually I had to move on and work to be successful elsewhere.  With the contrast in success versus significance I had to ask myself if I left some significance on the road to success.  In other words, how do others view and remember me?  Do they smile when they remember me or do they frown?  Is it somewhere in between?
Remember as a kid when we wanted attention and we would do anything to get it.  The problem was we never analyzed the kind of attention we might get.  In the end, however, any attention was better than none.  Significance can kind of be that way.  What we do, how we do what we do, and who we are determines our significance.  I know I want to be in the good significance line.  I would like to know that when I am in my final days that people will have been touched by my presence and my positive influence.
Now, I may never be a Lou Holtz but if I will be the best Gene Ramsay I can be...if I can strive to be the best there is at whatever I do...if I work to make a difference and to be positively significant then I may just be as much as  motivator in someone's life.  That's significance.  That's leaving something that matters long after success has faded.

The following video may be a little long (a little over 8 minutes) but I feel it's worth it for us all to watch and consider.  "The 7 Principles of Leaving a Legacy"...

Wednesday, February 9, 2011

"What If" Insurance. It Could Save a Life

Many people I talk to about voluntary insurance say they are not impressed with some of the offerings.  Many times I even tend to agree.  The reason being that I am a big proponent of the hierarchy of need concept for most working Americans.
The first and most important benefit any working American needs is health insurance.  More bankruptcies are filed each year because of the unforeseen emergency hospital stay, surgeries, etc.  The whole reason for health insurance is to be sure the hospitals and doctors get paid to make you all better.  You never know when a catastrophic accident or illness will strike.  In many ways, health insurance is the biggest "what if" in the insurance market.  But this is not the kind of insurance I am talking about here.
The next most needed insurance I would say is a toss up.  I can make a good argument for either disability or life insurance to land in the number two spot.  For this article I will choose disability insurance as my next to discuss. This is the sort of thing that replaces your income if something should happen to you away from your job that would summarily keep you from coming in and doing your job.  One question I always ask is, "How long could you go without a paycheck"?  The majority of people usually answer, "Until my next paycheck".  Disability insurance could be the difference in someone losing their home or not due to an unforeseen illness or injury who needs income to keep the bills paid until they get on their feet again and can work.  This is the next most needed bit of "what if" insurance.  But I'm not talking about this either.
Next in line would be life insurance.  This is the ONLY insurance ever guaranteed to pay anyone a dime.  It's necessary, if for nothing else, for final expenses and/or burials.  This is not a "what if" in any book.  It's a necessary part of our lives.  We need to be responsible to take care of the inevitable "final day".
After all these needs get met, THEN we get into those insurance products that many professionals feel are "unnecessary" or are fluff in someone's insurance portfolio.  The insurance I want to focus on here is another "what if" piece of insurance.  The insurance I want to make an argument for is accident insurance.
Just like it's name sounds, this is a product that covers you in the event you have a "what if" moment in the area of an accident.  It works hand in hand with both of the above other pieces of needed "what if" insurance in that it can help pay a lump sum benefit based on the severity of any accident and it can also be used to handle co-pays and deductibles you will surely have with an ambulance ride and/or an emergency room visit.
True story:  A few years ago we are sitting and discussing insurance offerings as a place of business.  We had been sitting with each employee all day and were winding down.  One gentleman sat with a benefits counselor and got the same information on life insurance, disability coverage and the like.  At ever turn we were met with opposition and the unnecessary need for these insurance products.  As we were wrapping up, the client wanted to look at the accident insurance one more time because he rode a motorcycle to and from work and he knew the dangers he might run into.  Six weeks later, the "what if" hit home as he had a near fatal motorcycle accident on his way home from work.  The accident put him in an ambulance, the emergency room, in surgery for almost every bone in his body, and a hospital room.  This man dies after a 30 day stay in the hospital as his body just could not heal.  The accident policy paid a claim to his wife and four children in excess of $50,000.00.  Since they had health insurance, that coverage helped.  But because he refused all manner of discussions about life insurance, this piece of "what if" insurance saved his wife and children from a financial nightmare on top of the emotional devastation of a "what if".
So, the next time you think there might be an insurance hole to fill based on your way of life or just for piece of mind...think about "what if" and then make the call.

Something funny for you...

Tuesday, February 8, 2011

Who Has Time?

The title of this post is a statement we have all uttered at one point or another.  It's been asked for many things and for various reasons.  It's been contemplated as people try to put all they can on themselves and live the fullest life possible.  The question I have for these people who utter the statement is, "Really?"
First off, time is what it is.  There are 24 hours in a day and we all get the same 24.  The real question is, "What are you doing with your 24?" So many times when we talk about not having enough time to do something, it usually means that we have already allotted our time on what we feel is most important and we can't fit one more thing in.  The end result is that we can...if we really want to.  The day still starts with the sun and ends with the moon.  Another question I have for the people who say they don't have time is, "What is it you want to do with your time?"  Many times that answer is far different than what they actually spend their time doing.

If any of you have ever been on Weight Watchers, you know that one thing they ask you to do is track your food.  Every single thing you put in your mouth that day gets documented.  EVERY LITTLE THING.  In Weight Watchers a small Hershey's Kiss can be the difference in being over your total of allotted points for that day.  Your goal is always to maximize what you eat within the meals you have.  You don't want to be too under or over.  You want to be spot on for the program to work.
Why not try that with your time?  Have you ever documented what you did as you did it?  Sure, we have calendars of our daily "plans" but what really happens in the day.  The key is to be totally honest with what you document.  You have to be honest with the "what" and the "how much time" that you spend on things each day.  Try it for one week.  Get a notebook and track what you spend your time in a day doing each day.  At the end of that week you might be sick to find the amount of time you "wasted" was on things totally unrelated to anything you really want to spend your time doing.
Many of us have goals and dreams.  What did we do today to get one step closer?  If the answer is "nothing" then evaluate your time and find time to make that change.  Any idea how much you can get done in the 2-3 hours a day we might just sit and watch TV?  Think about it.
The other thing to consider is how badly you want to accomplish something.  How many people seem to find the time to get more done in the day.  The good news for everyone reading this is that you can "find" time too. It's in those 24 you have.  I'm not saying don't sleep to accomplish it, I'm saying prioritize.  I could give you example after example after example of what you want to do versus what you actually do, but I think you get the point.
I'll finish with a personal example.  I was HUGE into fantasy football a few years back.  I played in as many leagues as I could find and even ran my own.  I spent every day and every week for months out of year looking and reading and learning all I could about players and who to play the following week.  Bedtime for me most nights was after midnight.  Guess what the result was.  I was AWESOME!  I usually finished in the top three teams no matter what and won over 6 championships in 4 years.  I wrote about it and lived and breathed it.  Guess what happens to a good relationship with your spouse after about two years of this.  I'll give you a hint...it's not good.  Once I came out of my pigskin haze to realize that there was something way more important to me than fantasy football and winning, I had a choice to make.  I chose my wife.  The following year I dropped it all.  I stopped my league and all others.  Everyone was stunned but I had a decision to make.  I evaluated the amount of time I had spent in this endeavor and when I came out of that evaluation period I literally got sick to my stomach that I allowed this to happen.  I had to re-prioritize what really mattered to me and spend my time there.  Guess how much quality time I can have to spend with my wife now.  Lots.  Guess how much I take.  Lots.
So, decide what you want and who you want to be and if what you are spending your time doing is not in line with that, you've got some decisions to make.
Good luck.  You'll be glad you took time to evaluate your time and then you'll have all the time you need.
Time is like money...spending it wisely makes all the difference in the world and in your life.
What would a blog about time be without a blast from the past in Cyndi Lauper's video "Time After Time"?

Monday, February 7, 2011

Would You Wear the Ring?

As football season comes to a a close, I am reminded of a debate of sorts that I have often pondered.  This is the time of year where championship games are played.  With those championships comes awards, a trophy, and then later a ring.

Now, these rings are usually beautifully crafted filled with stones.  The carvings have the individual player's name, team name, season record, etc.  A lot of hard work goes into making these lovely awards of art that have been crafted to show they world that the person who wears this ring is a champion.
However, many times you see these players selling their hard-earned ring on eBay.  Others times they just keep the ring in a safe and never wear it.  Then on the flip side there are players who wear their ring all the time showing their pride for the accomplishment.
As these two polar opposites hit me, my thoughts go to what I would do.  Would I wear the ring?  Would I hide it away?  Would I sell it (I don't get this one at all)?  So I started looking at the answers these athletes give for NOT wearing their hard earned bling and I am intrigued by their statements.  Here are a few:
1 - "I don't want to wear it because then it's like I've accomplished everything and I have nothing left to attain to".  I like this answer the best.  It shows the hard work and determination that the person feels compelled to continue on producing.  They feel the ring is a stopping point and might make them complacent as they spend more time looking at their sparkly ring than working for the next or working to better themselves.
2 - "It's just too big and gaudy and it hurts my hand".  Well, I can see this one too.  Have you seen those things?  Many of these rings are so heavy and so large that the knuckle it's worn next to is just in pain to even support it.  I'm not sure who decided to make these rings bigger and brighter with each year.  Look at the first Super Bowl ring.  Now that was a sensible ring that a player who wanted to wear it could.
3 - "I don't want to show off".  I kind of like this answer too.  The humility it takes to "dial it down" after winning "the big one" takes a strong person.  Many times as accolades are heaped upon us we tend to get a little proud.  We puff out our peacock feathers for the world to see instead of remembering all the hard work and determination it took to get where you wanted to be.
4 - "I don't deserve to wear it".  This usually comes from the player who didn't play much to get the team to being champions.  While they may have practiced hard and been available to play, they never got their chance to show what they could do.  They never got their jersey dirty.  To them, just being a part of the team is not enough.  They feel they had to do more to earn the right to wear the ring.
Now, let's look at ourselves.  Would you wear the ring?  How would it effect you?  Many times in life we are given something we know we earned.  We put in the time and the effort to make it happen and awards day arrives and we get the ring (so to speak).  What happens next?  The key is to balance earning something great to never resting so more can be accomplished.  The thing with life is that it's never over until we take our last breath.  We may have gotten the ring for today, but how much more can we accomplish long after that ring has lost it's shine?
I personally like seeing people wear their championship rings.  I know what went into making those things and I know what went into earning it.  What I like the most is seeing that they can wear it as a reminder of where they have been, what they have done, and what they need to do to be worthy to keep on wearing it.
Every group I am able to help and every person I am able to answer a need for is like a ring to me.  I'd consider it an honor to earn a ring from you as well.
Step into my office...
Now, for a funny video:  http://www.youtube.com/watch?v=mO1F3er-jDk&NR=1

Thursday, February 3, 2011

If the Situation Was Critical - How Would You Cope?

I love stories that help me help people make informed decisions about insurance and why it's important.  Unfortunately, most of those stories are the bad news stories of people in their time of need.  I met a woman today who relayed her story to me about a critical illness that occurred to her not two years ago.
One of the products that has always kind of baffled me in terms of need has been a critical illness insurance plan. Most of the time, these plans pay a lump sum benefit if you should be diagnosed with having had a heart attack, stroke, renal failure, blindness, paralysis, etc.  All that is well and good, but the question I always has was how would this money they receive (sometimes in upwards of $50K) help?  Today I found that out.
As this very nice woman told me her tale of illness, the first thing that struck me was that once she was diagnosed with having had a heart attack, her doctor recommended she take a year off of work to get better and hopefully heal.  A YEAR?  Exactly how did this doctor think someone who was working full time go into a year long state of disability with no income?  That's not really the doctor's issue now, is it?  Fortunately she had a working spouse who was paid well enough that the bills could be met and she could take her needed time of rest.  Fortunately she did heal.  Today she can have all the EKG tests she wants and there seems to be no signs of ever having had an issue.  That's great for her, but what about the other people this could happen to?
The reality is most lengthy health issues happen just like this.  Unfortunately, most people can't just take time off like this woman was able to do.  They have to do something or risk the stress of going bankrupt or losing all they have.  THAT is why critical illness insurance is there.  If this lady was not in the minority, she would have needed money and she would have needed enough to at least get her through a year.  How far would $50K go for keeping your bills paid for a year?  I think I'd be OK in that situation and one thing I would not be stressing over is money.
So, the next time someone talks to you about critical illness insurance, remember this story and ask yourself how long you think you could go without income if the doctor told you you needed to take a year off to get better.

Wednesday, February 2, 2011

Welcome to The Ramsay Bugle...Blog Style!

Hello all.  This blog is new for me for 2011.  In an effort to be of the best service and provide my friends and fans with the most and best information, I needed a platform that would allow me the flexibility you need and an avenue where I can bring the most information to you.  This new blog will also allow me the ability to post more things without attacking your inbox.
I will continue to do the Constant Contact newsletter for everyone on my email list.  If you are not on that list, I will be posting many of the main articles that I send to everyone in that venue.  Why not just do the blog?  When I asked all of my friends and fans what THEY wanted, many came back with just keeping the newsletter with others stating that an online blog would be a good idea.  The newsletter is once a month and does take some doing to put together.  The blog I can write and/or post as I am inspired and have time.  Many of my friends and fans follow me on Twitter (@RGRamsay), Facebook (Gene Ramsay - The Insurance Man), and LinkedIn.com.  Those people will be notified every time I post here.  So basically, if you want to stay connected with me on all levels, follow me here by subscribing to this blog and connecting with me on the various social networking sites as well as getting on my email list.
Thank you to all of you for asking for this and being willing to be a part of my life in business and otherwise.  I hope to bring everyone here timely and valid info with regards to the insurance industry as well as other things I am involved in as they happen.  I feel it is KEY (for those out there who want to know me for business purposes and social purposes) for me to share on this blog who I am and what I do.  I can state all day long that you should work with or connect with me in some capacity so you know what you're getting when you contact me.
Lastly, if you ever have questions or comments, feel free to contact me through here.  I always try to be a phone call or an email away...so let me know what I can do to serve.
Step into my office...