The Roman military commander Caius Marius instituted a concept called the Burial Club for the beneficiaries of Roman soldiers, similar to our modern day final expense life insurance. Burial procedures were steeped in religious superstition to the point that the dearly departed would haunt their family and friends if they were not given a proper burial. These clubs evolved into burial societies with strict adherence to their procedures and beliefs. Roman legions were successful for almost 600 years and the soldiers who survived out numbered the solders who died. Enter the first practical use of the concept of the law of large numbers, the very math that insurance companies use to determine calculate probabilities of death among a specific demographic. Sir Edmund Halley designed the first actuarial model for life insurance in 1693. The Amicable Society issued the first life insurance policy in 1706 in England. In the U.S. in 1759 The Presbyterian Minister’s Fund was formed to take care of the widows and children of deceased ministers. In 1762 The Society of Equitable Insurance was formed and issued life insurance policies, the predecessor of what is now called AXA. In 1835 the venerable New England Mutual, the first U.S.   Read more…

There is a variety of budgeting software available online, some of which is free. But in today’s modern family, the best way to construct your budget is to simply look at the things you purchase or pay for with checks and charge cards. It’s not the best way to begin creating a budget, but for many it’s the best place to start. Most budgetary items are monthly, some quarterly and others semi-annually. Most income is bi-monthly, so the goal is to split your monthly expenses evenly between the first and latter half of the month.  Hopefully this will create less pressure on your cash flow. Many graduates from high school and college are shell shocked when they receive their first paycheck and notice their net proceeds are far less than they anticipated, so a budget is determinate on the net proceeds not the gross. You may want to consider increasing your exemptions to a point that you have no refund, but you do have increased cash flow. There are basically three budget categories: Essentials, Savings, and Discretionary. Essentials Expenses are the obligations of life: housing, utilities, food, medical, transportation, clothing and basic education costs from kindergarten to senior year in   Read more…

HECM loans are not a silver bullet for every retiree and they haven’t been good for everyone who has used them. But for many, these strategies are just short of a godsend. There are requirements for HECM loans and suitability determination for which strategy fits your retirement course of action. Whatever HECM strategy you select, keep in mind you still have property taxes and homeowners insurance to pay. You still have a mortgage, but you don’t have a mortgage payment. Also please note, you still have closing costs with any of these transactions. There are many HECM strategies Tax-Free Income, Mortgage Payment Elimination and an Appreciating Equity Line of Credit, just to name a few. Reverse mortgage is an alternative use of your home equity for tax-free income. In a traditional mortgage, you make payments to the lending institution. In a reverse mortgage, the institution makes loan payments to you. Loans on an existing mortgage are not classified as income while you maintain the mortgage. A home purchase mortgage is another alternative use of your home equity where you can buy a home for around half its sale value not to exceed the maximum claim amount. The main stipulation here   Read more…

Social Security Benefits inception was in 1935 during FDR’s term as President. It was one the government’s responses to the Great Depression. The key debate on Social Security back then was whether the benefits should be “doled out” or pay as you go insurance approach. Self-financing was the centerpiece of the original concept. Social Security benefits generate lifetime income to retirees starting as early as age 62. Originally there was no taxation on Social Security benefits. Now there’s a means testing income threshold that taxes benefits on a two-tier system. And with the exception of Roth IRA distributions, Reverse Mortgage income, Cash Value Life Insurance and Health Savings Accounts, all other income is includ in the provisional income test to determine Social Security benefit taxation. Medicare Health Coverage was enacted in 1965 under LBJ for seniors age 65 and older. Knowing the basic benefits of Medicare Parts A and B can save you time and create fewer headaches in the future. Operated by the federal government, Medicare is available to qualifying individuals age 65+ and consists of three main parts: Part A, Hospital Insurance and Part B, Medical Insurance. Part D is the prescription drug program. With Part A Hospital   Read more…

There is a variety of budgeting software available online, some of which is free. But in today’s modern family, the best way to construct your budget is to simply look at the things you purchase or pay for with checks and charge cards. It’s not the best way to begin creating a budget, but for many it’s the best place to start. Most budgetary items are monthly, some quarterly and others semi-annually. Most income is bi-monthly, so the goal is to split your monthly expenses evenly between the first and latter half of the month.  Hopefully this will create less pressure on your cash flow. Many graduates from high school and college are shell shocked when they receive their first paycheck and notice their net proceeds are far less than they anticipated, so a budget is determinate on the net proceeds not the gross. You may want to consider increasing your exemptions to a point that you have no refund, but you do have increased cash flow. There are basically three budget categories: Essentials, Savings, and Discretionary. Essentials Expenses are the obligations of life: housing, utilities, food, medical, transportation, clothing and basic education costs from kindergarten to senior year in   Read more…

According to a Wall Street Journal article in October of 2014, life expectancy has increased to an average of age 65 for males and age 86.6 -88.8 for females.  It is estimated that women survive their husbands 87% of the time and average around age 93 at death. But that’s the average, which means half will live longer! In 2014 it was estimated that over 72,000 American seniors were age 100 or older, worldwide the number was about 450,000.  By 2050 there may be 3,676,000 seniors living on the planet.  So even without any significant medical advancement, the numbers of senior centenarians could become dramatically higher. In light of this great mortality revolution, should you start planning to live to age 100?  You may need to prepare yourself for age 100 if your family tree already contains longevity and/or you exercise religiously and are committed to a healthy diet. There also seems to be a gender advantage towards women in life expectancy stats. Preparing for geriatric living starts with guaranteed income you can’t outlive via lifetime annuities with a cost of living rider.  Preparing for elder years should include retrofitting your home for single level living with stairs turned into   Read more…