Working With Your Best Interests In Mind

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“Its business,” is the excuse many professionals use when they are doing something they know is less than ethical. They aren’t doing anything illegal, they’re just maneuvering a situation to benefit the company they work for, or their own bank account, OVER the benefit of their client.

We see this frequently in the financial services industry, and it’s the reason so many individuals are leery to trust someone else to manage their money. And it’s logical to be cautious when you know that someone will make their living off of the decisions they lead you to make with your wealth.

Camouflaged under the concept of “Business is Business” many stock brokers make recommendations to their clients that are not really in their best interests. An article found in Yahoo Finance Online* says,

“Many of those who work on Wall Street go through a process in which they gradually learn that what is perceived as “smart investing” is often unbelievable dumb. Specifically, they learn that many of the recommendations that Wall Street makes, and the transactions that Wall Street gets paid to facilitate, are not in their clients’ best interests.” The article goes on to talk about a former stockbroker named Josh Brown who left the business when he was forced to do things that weren’t really in the best interest of his clients.  He is now a Financial Advisor and says that in this position his interests and his client’s interests are more closely aligned.

“Most people don’t recognize that there’s even a difference between a “Stock Broker” and a “Financial Advisor,” but there is, the article says. “Stock brokers generally work for brokerage firms and do not have to recommend trades that they think are in their clients’ best interests. Rather, they just have to recommend securities that are “suitable” (a much lower standard). Financial advisers, meanwhile, have a fiduciary duty to act in the best interests of their clients.”

The article concludes by saying that someone looking for “sound financial advice” would be wise to choose a Financial Advisor over a Stockbroker.

Articles like these make Cornerstone proud to have a group of Financial Advisors who have a DUTY to provide their clients with more than just “suitable options”. Cornerstone advisors are required by law to make sure that they offer the very best options to anyone who comes to them for advice.

In addition to the state specific laws and regulations they follow, Cornerstone itself has set very strict procedures that must be followed when their Advisors are meeting with clients. As mentioned in our previous article, “The Importance of Fact Finding,” (https://cswta.wordpress.com/2012/07/27/the-importance-of-fact-finding/) we take collecting information about our clients VERY seriously. Why? Because to make the best suggestions, we must have all the information!

Giving Cornerstone an even stronger ability to do the best for their clients, is the huge number of Investment Relationships they have. Cornerstone works with more than 30 different A+ rated companies (You’ve surely heard of some of them, like John Hancock, ING, MetLife, Lincoln Financial and Humana) and so their agents have the ability to compare the rates of a number of companies and find the best option for you!

Even dealing with a Financial Advisor who represents a specific Insurance Company or bank can bring on a challenge, because they may recommend the best option that THEIR COMPANY has to offer, but it may not be the best option for you overall. Cornerstone itself is not an insurance company and does not have any of its own products, so when meeting with a Cornerstone representative, clients can be assured that their Advisor has no ulterior motive in suggesting a certain product or service.

Their job is to pick the product that will save you the most money, make you the most money, or best meet any of your specific needs. When seeking good financial advice, as the Yahoo article mentioned above, contacting a Financial Advisor, such as the 50+ representatives Cornerstone has employed is the smart way to go!

Feel free to contact any one of our representatives for financial advice completely free of charge! http://www.cornerstonewealthsc.com/agents.php      

Hurricane Preparedness

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This week we’re stepping outside of our normal topics of discussion and moving to something pretty relevant for this time of year. Hurricane preparedness.

All along the East Coast and Gulf Coast over the last week, families have been preparing for the latest tropical disturbance, Isaac.

Isaac reached Hurricane strength this afternoon and should reach the coast of Louisiana this evening. Although many times, hurricane preparations turn out to be needless as a storm takes an unexpected turn, most people remember storms like Katrina (2005) and Hugo (1989) and know just how important that preparation can be.

One family from the panhandle of Florida has to board up their windows, build sandbag walls around their home, pack most of their belongings and evacuate multiple times a year. Most of the time they come back home to everything exactly as they left it, unpack and carry on with their lives, but they’ve seen enough destruction over the years to know how important it is to be prepared.

“I’ve lived here on the Florida coast all my life,” says 62 year old Johnny Rivers, “And we have lots of false alarms, but when you come back after a big one, and your refrigerator has been smashed through your ceiling into the upstairs, you are glad you left. We have friends and neighbors that we will try to warn, and some think they want to stay and stick it out. We’ve heard horror stories when we returned.”

“They always say they should have listened to Johnny,” His wife Nan adds. “And now every time there’s a storm they come back to him to see what they should do. They say, ‘We’re going to do whatever Johnny does!’ Because they know that he leaves when he should.”

Like the Rivers family, all families should take the time to think ahead during hurricane season to be as safe as possible. According to the ready.gov Website there are a lot of things we can do to be safe, before during and after a storm. Here’s the breakdown:

BEFORE

  • To begin preparing, you should build an emergency kit and make a family communications plan.
  • Know your surroundings.
  • Learn the elevation level of your property and whether the land is flood-prone. This will help you know how your property will be affected when storm surge or tidal flooding are forecasted.
  • Identify levees and dams in your area and determine whether they pose a hazard to you.
  • Learn community hurricane evacuation routes and how to find higher ground. Determine where you would go and how you would get there if you needed to evacuate.
  • Make plans to secure your property:
    • Cover all of your home’s windows. Permanent storm shutters offer the best protection for windows. A second option is to board up windows with 5/8” marine plywood, cut to fit and ready to install. Tape does not prevent windows from breaking.
    • Install straps or additional clips to securely fasten your roof to the frame structure. This will reduce roof damage.
    • Be sure trees and shrubs around your home are well trimmed so they are more wind resistant.
    • Clear loose and clogged rain gutters and downspouts.
    • Reinforce your garage doors; if wind enters a garage it can cause dangerous and expensive structural damage.
    • Plan to bring in all outdoor furniture, decorations, garbage cans and anything else that is not tied down.
    • Determine how and where to secure your boat.
    • Install a generator for emergencies.
    • If in a high-rise building, be prepared to take shelter on or below the 10th floor.
    • Consider building a safe room.

DURING

If a hurricane is likely in your area, you should:

  • Listen to the radio or TV for information.
  • Secure your home, close storm shutters and secure outdoor objects or bring them indoors.
  • Turn off utilities if instructed to do so. Otherwise, turn the refrigerator thermostat to its coldest setting and keep its doors closed.
  • Turn off propane tanks
  • Avoid using the phone, except for serious emergencies.
  • Moor your boat if time permits.
  • Ensure a supply of water for sanitary purpose such as cleaning and flushing toilets. Fill the bathtub and other larger containers with water.
  • Find out how to keep food safe during and after and emergency.
  • You should evacuate under the following conditions:
    • If you are directed by local authorities to do so. Be sure to follow their instructions.
    • If you live in a mobile home or temporary structure – such shelter are particularly hazardous during hurricane no matter how well fastened to the ground.
    • If you live in a high-rise building – hurricane winds are stronger at higher elevations.
    • If you live on the coast, on a floodplain, near a river, or on an island waterway.
    • If you are unable to evacuate, go to your wind-safe room. If you do not have one, follow these guidelines:
      • Stay indoors during the hurricane and away from windows and glass doors.
      • Close all interior doors – secure and brace external doors.
      • Keep curtains and blinds closed. Do not be fooled if there is a lull; it could be the eye of the storm – winds will pick up again.
      • Take refuge in a small interior room, closet or hallway on the lowest level.
      • Lie on the floor under a table or another sturdy object.
      • Avoid elevators.

AFTER

  • Continue listening to a NOAA Weather Radio or the local news for the latest updates.
  • Stay alert for extended rainfall and subsequent flooding even after the hurricane or tropical storm has ended.
  • If you have become separated from your family, use your family communications plan or contact FEMA or the American Red Cross.
  • FEMA has established the National Emergency Family Registry and Locator System (NEFRLS), which has been developed to help reunite families who are separated during a disaster. The NEFRLS system will enable displaced individuals the ability to enter personal information into a website database so that they can be located by others during a disaster.
  • The American Red Cross also maintains a database to help you find family. Contact the local American Red Cross chapter where you are staying for information. Do not contact the chapter in the disaster area.
  • If you evacuated, return home only when officials say it is safe.
  • If you cannot return home and have immediate housing needs. Text SHELTER + your ZIP code to 43362 (4FEMA) to find the nearest shelter in your area (example: shelter 12345).
  • For those who have longer-term housing needs, FEMA offers several types of assistance, including services and grants to help people repair their homes and find replacement housing. Apply for assistance or search for information about housing rental resources
  • Drive only if necessary and avoid flooded roads and washed¬ out bridges. Stay off the streets. If you must go out watch for fallen objects; downed electrical wires; and weakened walls, bridges, roads, and sidewalks.
  • Keep away from loose or dangling power lines and report them immediately to the power company.
  • Walk carefully around the outside your home and check for loose power lines, gas leaks and structural damage before entering.
  • Stay out of any building if you smell gas, floodwaters remain around the building or your home was damaged by fire and the authorities have not declared it safe.
  • Inspect your home for damage. Take pictures of damage, both of the building and its contents, for insurance purposes. If you have any doubts about safety, have your residence inspected by a qualified building inspector or structural engineer before entering.
  • Use battery-powered flashlights in the dark. Do NOT use candles. Note: The flashlight should be turned on outside before entering – the battery may produce a spark that could ignite leaking gas, if present.
  • Watch your pets closely and keep them under your direct control. Watch out for wild animals, especially poisonous snakes. Use a stick to poke through debris.
  • Avoid drinking or preparing food with tap water until you are sure it’s not contaminated.
  • Check refrigerated food for spoilage. If in doubt, throw it out.
  • Wear protective clothing and be cautious when cleaning up to avoid injury.
  • Use the telephone only for emergency calls.
  • NEVER use a generator inside homes, garages, crawlspaces, sheds, or similar areas, even when using fans or opening doors and windows for ventilation. Deadly levels of carbon monoxide can quickly build up in these areas and can linger for hours, even after the generator has shut off.

For additional information you may visit http://www.ready.gov/hurricanes

Cornerstone wishes Everyone a safe and successful week! 

The Future of Social Security

 

Social Security taxes- They’re taken out of every paycheck. We all see the figures every few weeks on our stub and although a small part of us wishes we could hold onto that money, we know that it’s going towards a good cause, so we let it slide. We are appreciative of a system that is supposed to take care of us after we retire. At least, that’s how it used to be.

When Social Security was enacted in the 1930’s it was a great bargain for its recipients because payroll taxes were very low.

“For the early generations, it was an incredibly good deal,” said Andrew Biggs, a former deputy Social Security commissioner as quoted in a recent Fox News article.* “The government gave you free money and getting free money is popular.”

The article says that if you retired in 1960, you could expect to get back seven times more in benefits than you paid in Social Security taxes and more if you were a low-income worker, as long as you made it to age 78 for men and 81 for women.

However, in recent years those numbers have changed drastically. According to a 2011 study by the Urban Institute, the average married couple retiring last year paid $598,000 in Social Security taxes during their careers and can only expect to collect about $556,000 in benefits if they live into their 80’s.

Fox’s article explains why the decrease is happening.

“The shift among middle-income workers is happening just as millions of baby boomers are reaching retirement, leaving relatively fewer workers behind to pay into the system. It’s coming at a critical time for Social Security, the federal government’s largest program.

“The trustees who oversee Social security say its funds, which have been built up over the past 30 years with surplus payroll taxes, will run dry in 2033 unless Congress acts. At that point, payroll taxes would provide enough revenue each year to pay about 75 percent of benefits.”

This leaves future generations either getting fewer benefits or paying higher taxes, and individuals who fall into this bracket are less than pleased. One recent college graduate states that she recognizes the money she pays in now, isn’t going to be waiting for her when she retires. “If I wanted Social Security 50 years from now I would have to hope that someone else is still working and putting money aside in their paychecks to pay for my Social Security at that point,” she says.

Some have taken a more aggressive approach and opened their own private retirement accounts to ease their worry that Social Security won’t provide adequate benefits in the future.

David Armbruster, Investment Advisor Representative in South Carolina, sees more and more clients of the younger generation, who are interested in finding the best place to invest their funds.

“They know that although their parents and grandparents have been able to rely on Social Security, it may not be there, or be sufficient when their turn rolls around, and they don’t want to take any chances,” he says.  “The biggest problem that we see overall when it comes to retirement funding is that costs are going up and benefits are going down. For our younger generations, it is imperative, more so now than ever before, that they be involved in their own retirement planning. IRA, 401K, Roth IRA and other retirement vehicles are becoming more and more important. These younger generations will be responsible for their own retirements. Gone are the days of waiting for Uncle Sam to pass out a paycheck. Self sufficiency is a must.

“There are a lot of wonderful investment vehicles out there. Some of the best programs around right now are annuities. Inside annuities we can find protection from market risk, guaranteed growth moving towards retirement, and guaranteed income once we get to retirement. For many folks, annuities will be the tool that can be used to create their own “social security” checks. Pensions are a thing of the past. Social security is moving that direction quickly. People are going to have to get smarter about their planning or plan on working for a lot longer.”

For more information on the types of products discussed above visit www.cswta.com.

* http://www.foxnews.com/politics/2012/08/07/new-retirees-receiving-less-in-social-security-than-paid-in-marking-historic/

Lost Life Insurance Policies

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Last week’s blog focused on a program that can help the person managing your affairs after you pass away. https://cswta.wordpress.com/2012/08/06/silent-partner/. In a follow-up to that post, we’d like to reference a recent article found on Yahoo Finance entitled “Life Insurers Pressed on Lost Policies.”*

The article begins by mentioning a woman, named Mary Lou, who was surprised to receive a check for $7,000 more than a decade after the death of her father. The check was from unclaimed life insurance policies her father had taken out previously, that his family had no knowledge of.

At the time of her father’s death, Mary Lou inquired with the insurance company with whom she knew he had policies, to see if there were any other accounts. She was told at the time that they didn’t owe her anything else. As it turns out, that $7,000 check was for three policies that she didn’t have a policy number for.

Mary Lou voices her concern for the situation as it may affect others, “Can you imagine all the millions or billions of dollars that belong to other people and they don’t know to claim it,” she says, in Yahoo’s article?

Backing up Mary Lou’s statement, state regulators estimate that over the decades life insurance companies have failed to pay well over $1 Billion in death benefits. The reason? Because it’s up to the beneficiaries to file a claim following death.  One industry official says that whatever the amount is, it’s a “very small percentage” of total claims paid. “We know the percentages represent real people and we’ve been working with policy makers on ways to ensure all policyholders get the benefits they deserve,” said the official, Bruce Ferguson of the American Council of Life Insurers.

Recognizing that new technology can help alleviate this problem, insurance companies in many states are being required to check old unclaimed policies against death databases, and to make payouts to those they owe.

Most insurance companies will probably not fight these regulations. Yahoo’s article went on to state that opposing a requirement to check the databases would be particularly difficult given that many insurance companies already check them when it’s in their interest- for example, to learn about the deaths of annuity customers because such deaths usually end the insurers duty to make payments under retirement-income contracts.

As many such modern systems are slowly being implemented into this industry, the process of handling insurance claims is no doubt going to undergo some changes. The article mentioned above referenced a number of such changes that are already taking place.

Of course we all look forward to a time when this process has been completely ironed out and programs such as “Silent Partner Executor Planning” will no longer be necessary. But in the mean time, the monetary figures mentioned most likely only strengthen your resolve not to be one of the many whose unclaimed benefits make up that staggering $1 Billion.

Taking advantage of a free program to keep you out of that statistic is definitely a wise course.

For more information about this program as offered through Cornerstone please visit us here: http://www.cornerstonewealthsc.com/silent_partner.php

*http://finance.yahoo.com/news/life-insurers-pressed-lost-policies-030100774.html 

Silent Partner

It’s pretty much understood that planning for the future with products such as retirement packages and Life Insurance are necessary in today’s world. Nobody wants to leave their family members scrambling to come up with funeral expense funds in the wake of losing a loved one!

So, you’ve taken care of this, and that’s great! You have the best interests of your spouse, or children in mind and you have taken definite steps to make that inevitable occurrence a little easier to handle. However, one thing many people neglect to consider is how arduous the process can be when it comes to filing paperwork and handling claims. Especially because sometimes the family members left behind aren’t fully aware of what kinds of plans/policies their deceased loved one even had!

This is where something called a “Silent Partner Program” can really come in handy.

A Silent Partner Program is just another term for an Executor Planning Document and is a way to keep family records organized and up-to-date. This will take a lot of the stress away from someone who is going to be grieving and may find it difficult to navigate the planning process ahead of them.

Many people find it difficult to compile this information and share it with their family members, but fortunately, a number of Retirement Planning companies provide a structured program to manage all of this data.

Usually, a representative from the company will meet with you one on one and walk you through filling out all necessary documents. This will likely include details on the following personal information:

•             Personal Documents

•             Survivor’s Guide

•             Family Data

•             Safe Deposit Box Inventory

•             Contacts

•             Budgeting

•             Additional Sources of Help

•             Personal and Financial Security

As you work together to gather all this data, you will no doubt start to realize how important it is to have this available to those who care about you most!

When all the details are correct and finalized, a number of copies of this document will be created to be kept by the necessary individuals. You will keep one copy for yourself so that you can refer back to it annually and make sure it’s still up to date. Another copy will go to your “Silent Partner,” the person who will be using this information in the event of you becoming disabled or passing away. A final copy will be kept by your retirement planning agency. Your representative will check back with you periodically to see if you need to execute any changes to the information, in which case a new document will be created and distributed. This representative will also be the point of contact for your family members when the time arises to use the information contained in the document.

Just like a will or a Life Insurance policy, a Silent Partner Program is an essential step in looking out for the future of your loved ones. It’s a simple service that many companies provide for free to you and your family.

Why not start working on yours today? http://www.cornerstonewealthsc.com/silent_partner.php

The Importance of Fact Finding

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You’re at home on a Tuesday afternoon and you receive a phone call from a local retirement planner, offering to visit you at your home, explain the Medicare program and do a free financial review.

Of course, as an informed consumer, you are skeptical. “What are they going to try to sell me? Is this legitimate?” You may wonder.  And these are valid questions. ANY time ANYONE wants to visit you at your home or wants you to divulge personal information, it’s your responsibility to do your due diligence and make sure the representative is legitimate. In a society filled with dishonesty, scams and scandals it can be hard to know who to trust! This article will discuss a few ways you can help ensure that you are dealing with who you THINK you’re dealing with and also that they give you the treatment you deserve.

Step 1- Identification

When you book an appointment with a representative over the phone, be sure to get their FULL name and the name of the Company they represent. Your first step is to make sure that they are licensed to do what they say they do. If they are representing an insurance company, or a group that works with insurance companies, they are required to have a state insurance license. You can easily go online and do a search for the Department of Insurance for the state you live in. Each website usually has something called a “Producer Search” which allows you to inquire by Insurance License Number, or by name.

When you find the name of the person you’re looking for you will want to verify that their license is current and active. If you have trouble finding them, don’t hesitate to contact them back and ask for a State Insurance License Number. If you still can’t find it, or if it’s not active, do not meet with this person! Contact their company back and ask for a manager. The company should be able to provide you with a different representative who can help you. You can also contact the state Department of Insurance for more information on that individual.

If you DO find them online, you’ll also want to search further and see which companies they’re licensed with. If you don’t immediately see a particular company listed, don’t be alarmed. Insurance Agents frequently become contracted with new companies as rates fluctuate and products change. They just want to be able to offer their clients the very best options! But sometimes these companies take time to reflect those contracts in the State’s online system.

Another issue is that sometimes an agent works with an agency of a certain name (For example: Jones Retirement Center) who has contracts with insurance companies (Like, John Hancock or Lincoln Financial) So the person on the phone might say: “This is Mike, with Jones Retirement Center.” but when you look him up online you don’t see any sort of contract listed for “Jones Retirement Center”, you only see “John Hancock and Lincoln Financial”. This is because the State sometimes only lists the contracts for actual Insurance Companies, not for the agencies they work through.

If this is the case, you’ll want to do another online search for the name of the agency they work for. So, using the example above “Jones Retirement Center in Financeville, Washington.” Most agencies have a website and you can use this site to review a little more about the company the agent represents and possibly even verify that the agent DOES in fact, work for that agency. (Many agencies list their representatives on their website.) You might also check other outside online listings such as Yellow-Pages or Google, to read reviews about this agency. If negativity seems prevalent with no response or explanation from the business, then you might want to turn elsewhere for your financial planning advice.

If the agent and agency clear all the above filters, the last thing you’d want to do, is just verify that they are who they SAID they are, when they come to your house for their appointment. Asking to see a driver’s license or insurance license will not throw an honest agent off-guard. They will be happy to share their credentials with you. Hopefully they’ll tell you that they appreciate your diligence and that they’re glad to be working with someone who has taken steps to protect themselves in this crazy world we live in.

Step 2- Fact Finding

If you went to a doctor for a check-up and he walked in the room and handed you a prescription for a heart medication, without ever talking to you, taking your blood pressure or running any other tests, you’d think he was crazy! He knows nothing about you or your situation, yet he’s trying to get you to take a drug for a heart condition! How can he even know you HAVE this condition? And even if he’s right, you might already be taking some other medication to treat it! Who knows how the two could affect each other!

It’s just as unreasonable, for a representative to come to your home and tell you that a certain product or service will best suit your needs, if they haven’t first done a financial review.

Also called a “Fact Finder” a financial review will let your agent know about everything you are and aren’t currently doing with your insurance, investments and savings. Having this information will allow them to inform you of possible problems and offer valid solutions.

It can be unsettling to divulge this type of personal information, but keep in mind, you’ve already verified that this is a licensed and trained representative, working for a company that has a good reputation. It’s vital that they have a full picture of your financial situation BEFORE you purchase any new product, or they suggest any changes to your retirement plan.

You may be asked any of the following questions:

  • What types of investments do you currently have? What are the interest rates and total balance of those accounts? (They will want to see statements if you have them and might even call the company to confirm different details of your policies.)
  • What type of life insurance do you have? (This is another case where showing the agent your policy and letting them call the company for full details is definitely to your benefit.)
  • What are the balances of your checking and savings accounts?
  • What type of health insurance do you currently have?
  • What is the current state of your physical health?

Honestly answering all of these questions is the only way that your representative can truly evaluate your situation and offer real solutions that could change your life!

If your representative doesn’t take the time to do this type of review with you, they aren’t doing their job. To get the best service in this industry, you must demand it! Don’t settle for less. Give them your full attention, and they will give you theirs.

Together you can work towards a secure future for yourself and your family.

For more information about Wealth Management and Financial Planning visit www.cswta.com.

 

Same monthly payment- double the benefit! How?

You may wonder why Cornerstone is constantly emphasizing the importance of having a regular financial review at least once a year. Managing Partner/Branch Sales Manager Jonathan Booher recently encountered a situation, which is a great example why these reviews are so important!

Mr. Booher recently met with a client who we will refer to as Mrs. Jones. Mrs. Jones is 66 years old currently in good health and hasn’t had any major medical complications within the last five years. Mrs. Jones was very happy with all of her insurance policies and felt like she was set and did not need a financial review. To be on the safe side, she decided to let Cornerstone review her current policies to make sure everything was still in force and in good standing, and that there weren’t any oddities to the policies she might have been unaware of (seems like there’s always SOMETHING hidden in the small print. Right?)

The Life Insurance Policy Mrs. Jones had purchased many years before, was a whole life policy that had a $25,000 death benefit. Her monthly premium was $50, and she made it very clear that was the most she could afford to pay for her life insurance.

When Mr. Booher did some research into this life policy, he found that in the years Mrs. Jones had been paying premiums into her life insurance policy, it had accumulated over $10,000 of cash value! However, Mr. Booher explained to Mrs. Jones, that in the event of her death, her beneficiary (her daughter) would ONLY be entitled to the $25,000 death benefit, and NOT to the $10,000 of cash value! This was very upsetting to Mrs. Jones, because her main goal was to leave as much of a legacy behind to her daughter as possible, and it seemed like a waste to just lose that cash value that was rightfully hers!

So, through Cornerstone, Mrs. Jones was able to take out a new life insurance policy. Using the $10,000 of cash value that had grown within her old policy she was able to fund a new policy with a death benefit of $52,800- more than double her previous benefit! ALL of this money will go to her daughter when Mrs. Jones passes away. And best of all, her monthly premium stays exactly the same!

In just one simple (and FREE) financial review, Mrs. Jones was able to use an asset she already had and double the benefit that will be paid to her family with NO added monthly financial responsibility!

This is just one example of how beneficial a financial review can be!

Cornerstone has more than 50 trained professionals who will complete a financial review completely free and with no obligation to the client! It’s what we do! These meetings can take place in the comfort of your own home at a time convenient for you.

Contact us to set one up today!

843-376-3350

administration@cswta.com

Behold! The Power of Life Insurance!

Wanted to share this article written about life insurance, by our representative Matthew Gouin, a few years back. Very helpful information!

Tuesday, June 7, 2011 at 11:18am ·

By Matthew Gouin, Field Trainer

I’ve helped seniors with their retirement for the last several years now and I’d like to share a few ideas that have helped others I’ve met along the way.Life Insurance can be a powerful tool and can be used for much more than covering one’s final expenses. There are many ways to use life insurance and I’m going to share a few. The first is through Pension Maximization. When choosing a pension payout, you typically have several monthly options. Many retirees choose to take a partial amount to provide a widows benefit for their spouse. In doing so you will receive a lesser amount. I recommend taking the full amount and using the difference to invest in a life insurance policy. You can provide a large lump sum to your spouse rather than a monthly payout.

In addition to Pension Maximization, many of my clients are choosing life insurance to leave behind a legacy or offset estate taxes. The end of 2010, means the end of the Bush tax cuts. Starting in 2011 estate tax could be as high as 55% over the $1,000,000 exemption. Instead of using a monthly income to pay premiums, we will utilize the Required Minimum Distribution or (RMD) from IRAs to pay annual premiums. This gives the client cheaper premiums by paying annually, an answer on how to use the mandatory RMD, and it also creates a tax free benefit to whomever you choose.

Many retirees I meet with have old life insurance policies saturated with cash value. If you cash in the policy you will forfeit your death benefit and pay taxes on part of that money. If you borrow against it, you must pay that loan back plus interest. In most cases when you pass away that cash value stays with the life insurance company. There are few options to use that cash value so what good is it? Did you know that you can use that cash value towards the purchase of a new policy? Even though you may be 10,20,30 years older you can utilize that cash value to work for you. Insurance companies are more concerned with the health of an applicant than their age. Last year I had an 80 year client issued Preferred due to her good health.

Through a 1035 Exchange, we can transfer the proceeds from an old life insurance policy to a new life insurance policy with no tax consequences. Ultimately, this provides clients with three options: 1) Pay the same premium and maximize death benefit 2) Keep the same death benefit and reduce premiums considerably, or 3) Sometimes a policy that is completely paid-up.

2012 Update

As many of you may know, we relocated this fall into a corporate office suite in Summerville, SC. As our business continues to grow and expand we have recently welcomed in a group of new representatives from the Newport News, Virginia area. This team is being led by Branch Manager Erik Goerman who has had many years in the financial services industry.

Cornerstone has always tried to utilize modern resources to benefit both our employees and our clients. That is why we’ve recently started branching out by using a variety of Social Media Networks. Taking advantage of these avenues opens up many doors for our Financial Advisers and Representatives. It also allows us to keep our clients updated on what kinds of new products and services we can offer them! 

As this growth and expansion continues we will be updating this blog regularly with information that can benefit everyone!

Stay tuned!ImageImage

Website Revisions Live!

Great news! Cornerstone’s website has been recently revamped! Lot’s of exciting stuff for everyone! Check it out to see our event calendar for Cornerstone Representatives, as well as upcoming events for our clients too! There are links on the site to important documents and other helpful sites. It will also connect you to our Facebook and Photobucket pages where you can check out tons of photos from fun company events!

Whether you’re a current Cornerstone employee, a client, someone seeking employment or even someone looking to find guidance for their retirement planning and insurance needs, the website can be a great tool!

To visit go to http://www.cswta.com