Insurance – TGIF 2 Minutes with Kerrie Debbs, CFP

Failure of a Bank

Quick trivia: Who is famous for the saying, “It’s only when the tide goes out that you learn who’s been swimming naked”?? Ironically just last week Warren Buffett’s 58th annual “Letter to Shareholders” was reviewed by TGIF 2 Minutes, and, yes, Warren E. Buffett first famously uttered these words back in 1992.

The timing of his utterance was, as CEO of the insurance conglomerate Berkshire Hathaway, just following Hurricane Andrew when the inadequacies of the insurance industry were negatively exposed. Buffett was describing “the rosy appearances that can mask financial recklessness until the good times end.”*

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Murphy’s Law, YOLO, & Cash

From the Archives of TGIF 2 Minutes – with an update on cash.

One of the most critical factors of long-term personal financial success is…. guess:

A) The markets
B) Spending
C) Interest rates
D) Stock selection
E) Income level

And the answer is… SPENDING. This fact is why a truly competent financial planner will spend the most time on discussing spending, both today and future projected. Spending can also be expressed as “lifestyle” or “the basics of food, shelter, and transportation plus lifestyle”.

However, the inevitable will happen. And YOLO (“You Only Live Once”) will creep in.

The most basic factor that can soften a huge spending blow is CASH savings

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Inflation: Chicken or Egg? Or China?

Alert: “Getting into the weeds” here in a brief discussion on inflation and why it may not be easy to solve quickly. Bullet points below may help.

There is a bit of a “chicken or the egg” scenario when it comes to inflation.

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Caring For an Aging Friend 2.0

This topic has become far more complicated post-coronavirus.

Back in 2017, 2018 & 2020 TGIF 2 Minutes explored “Caring For Aging Parents”… which then became “Caring For an Aging Friend”. Whether caring for a family member or friend, finding and putting into action Care (with a capital “C”) may be more stressful than ever – both for Care-receiver and Care-giver.

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Beware of Money Scams

Just in the past week, two friends notified me they had been party to a money scam or potential money-related email hack. Going back further in time, there are numerous instances where a client or friend has made it known they were, regrettably, on the losing side of a money-related scam.

Look no further than this week’s news on a larger scale: due to recent, repeated money-request scams via the online payments network Zelle, major banks and financial institutions including JP Morgan, Bank of America, Capital One, and PNC Financial announced talks to reimburse scammed Zelle customers (Zelle is an online payments network in which various major banks participate).

All of these events prove that money-related scams are no longer isolated incidents.

Even intelligent people can accidentally find themselves in the midst of these gift card scams or urgent calls for money from what seems to be the IRS, the FTC (Federal Trade Commission), or Social Security.

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Hurricane Season

Hurricanes can come in various forms. Whether they be the recent Ian and Nicole or the staggering Sandy of 2012 they tend to strike in the fall season. Also, in the fall come U.S. elections and historically a bit of stock market volatility. Like the weather, markets are anything but predictable. Elections can lend themselves to predictability but there are always surprises too.

This year has had a mix of all these factors. Currently amidst high inflation the stock and bond markets are trying to digest an environment of much higher and increasing interest rates – exactly how much higher is an unknown. Also unknown is the post-election reality of future policy making in Washington, DC. Interest rates are “driving the economic bus” for the time being, and government policy making will be an ongoing force running alongside. Both will affect the markets in positive and negative ways over time.

Getting through hurricane season can be a relief – but only if it is known that the storm is over. Is the storm over or getting close to being over, and where does all this leave investors and savers?

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Alexa, Remind Mom to…

Thanks to a couple of smart and very caring friends of mine for today’s quick post. Everyone with a mother, mother-in-law (MIL) or even a grandmother will want to read on.

We cannot ever have enough resources when a parent or grandparent needs care or help getting around. Women tend to live longer than men, so Mom and Grandma are the ones who need the most help in their later years. Family members provide the highest percentage of help but often get in over their heads. The next step becomes researching in-home care giving – which has become exorbitantly expensive while still necessary.

Planning for care – and the cost of care – now will make it more manageable down the line.

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IMPORTANT Cyber-Security Message

In light of the recent Russian aggression in Ukraine and surrounding areas, here is a quick and important message regarding vigilance around security of personal information, including:

Bank accounts – including in-person, online, PayPal, Venmo, etc.
Credit card accounts
Email & Texts
Tax time information
Social media
Even Crypto accounts!

It should not come as a surprise to read or hear this message. Hopefully, the major news outlets are broadcasting this warning as well:

*The SEC has sent notices that the Department of Homeland Security’s Cybersecurity & Infrastructure Security Agency (CISA) issued a “Shields Up” notificatio*n.

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Important Early-Year Reminder

The following is an important reminder for every other year or so – more often if there are new people in your life:

Whoever, whatever you want to call them: Beneficiaries, “Bennys,” Heirs… make sure to check who is listed as Beneficiary or Beneficiaries on your retirement accounts, insurance policies, IRAs, trusts or in your Will (if you have a Will).*

Inevitably, time flies. Sadly, loved ones pass away; important loved ones may, well, change. (Think: divorce, relationship changes). Happily, new beneficiaries, or heirs, are born or enter the picture! In the busy nature of life, often the beneficiaries currently on record are not accurate or have not been updated in years.

Make sure to check who is listed as Beneficiary or Beneficiaries on your retirement accounts, insurance policies, IRAs, trusts or in your Will.

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Getting a New Car

There are few things as exciting as getting a new car: the “new car smell,” the test drive, the sound system, sunroof, heated seats… the feeling of “everything is new.” And these days, cars are advanced computers on wheels (and that means even the non-self-driving kind).

With that said, yours truly recently bought a new car – the first new car in 15 years! The old 2005 (Certified Pre-Owned) B-mer went 180k miles and could have gone another 100k but with a bit of maintenance here and there. Time for a new vehicle. But what new car to buy? New or used? Sedan or SUV? Buy or lease? And the cost: go expensive or reasonable in cost?

Any major purchase – housing, appliances, transportation, kids’ education, and the like – needs to be evaluated both from a **financial** and **emotional** perspective.

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