Will you be ready to retire when the time comes?
Retirement will either be a time of relaxation or possibly one of the most stressful times of your life depending upon how well you have planned for this time and of course if you are still enjoying good health. The professionals at Southern Insurance Group are well versed in setting up the right retirement plan for you so that God willing you will be able to enjoy your golden years.
Southern offers many different retirement plans to choose from, however, the retirement plan of choice is our exciting product line of indexed annuities. Indexed annuities have been around since 1995 a feature guaranteed principal savings, tax-deferred growth, up to a 10% bonus on you money and we can add income riders that pay an 8% interest rate. The earnings are based on capped market like returns which means you will receive a capped interest rate on the high side but if the market declines then you won't lose any of your principal.
These products can be set up for both qualified and non-qualified accounts. Qualified just means it is part of a retirement plan like an IRA, 401k, or 403b. if it is non-qualified that represents money that you have outside of the above mentioned for qualified status. Usually it is money saved up or a lump sum from a sale of a home for instance. Either way the indexed annuity is a perfect vehicle for putting money aside for retirement savings.
Retirement Investment Vehicles
Retirement may be a long, long way off for you or it could be just around the corner. It doesn’t matter how near or far away it is, you have definitely got to start saving for it right now. However, saving for retirement isn’t what it once was with the increase in the cost of living and the instability of social security. Nowadays, you have to invest for your retirement, as opposed to saving for it!
We shall commence by taking a look at the retirement plan, which is offered by your company. Once upon a time, these plans were quite reliable. However, after the Enron collapse and all the problems that followed, people aren’t as secure in their company retirement schemes anymore.
Many companies offer stock options for 401k's that employees have the opportunity to invest into on a matching system. The good news is that when companies offer this, they usually will match you up to a percentage of what you put in which is free money. I always recommend for clients to try to max this matching as this is a great incentive to building retirement income.
The drawback with this concept is that if you are too heavily invested in your company stock and the company goes south you can lose both your job and your nest egg. As mentioned above this was the Enron issue. People were devastated when this took place with hundreds if not thousands of people lost everything that they have.
Another potential issue that I see when I review the 401k's for my clients is that most people really don't understand exactly what or how they are invested. In Sept of 2008 when the market dropped 40-50% because of the banking and housing failures. People invested in 401k's lost a huge amount of money at this time and they most likely have not gotten back to zero since. My suggestion for you is to find out if you are able to withdraw the buildup in your 401k to something that will protect their principal from market decline. If this is not an option then review your account to make sure you are invested according to your risk tolerance.
If you decide not to invest in your company’s retirement scheme, you do have other options. First of all, you can invest in bonds, certificates of deposit, money market accounts, mutual funds and stocks but as mentioned my favorite is the indexed annuity. All these programs will help you build money for retirement, however some will perform much better than others. We will review the various options with you and let you make the choice that best meets your need. One of the keys to any good retirement planning strategy is to start early. The compounding of your money over time will cause your money to make you money over the years.
You could also open an Individual Retirement Account (IRA). IRAs are very popular since the money is not taxed until you withdraw the funds. You may also be able to deduct your IRA contributions from the taxes that you owe. An IRA can be opened at almost any larger bank.
A ROTH IRA is a much newer type of retirement vehicle. With a ROTH IRA, you pay taxes on the money that you are investing into your ROTH IRA account, but when you cash out, no federal taxes are owed. Roth IRAs can also be opened at most larger financial institutions.
Self-employed small business owners may also be interested in Simplified Employee Pension Plans (SEP). This is another kind of Keogh plan that people usually find easier to administer than a normal Keogh plan. Whichever retirement investment plan you choose, please make sure you do pick one! Again, do not depend on social security, company retirement plans, or even an inheritance that may or may not happen! Take care of your financial future by investing in one kind of investment scheme today.
Retirement is the time we all look forward to Here you are, counting down the last days before you retire, after what seems like a lifetime of work, "climbing the ladder", and investing into your IRA or 401(k).Congratulations!
Retiring is certainly one of the bigger milestones in life. And likely, excitement mixes with anxiety and apprehension. Is there going to be enough money? What are you going to do with all the new-found time? Among the many formalities that come with retiring, your insurance might not be the first thing on your mind. After all, the time to set up your insurance is usually long before retirement...
Still, as you take the plunge into retirement, give your personal protection plan a quick review: Adapting your personal insurance to your new status as a retiree may not only save you money, but will also set you up for the future.
What does retirement have to do with my auto insurance?
Now that you are retired and enjoying your golden years, you need to make sure that the work usage on your vehicle is changed to pleasure. This is not a huge discount but may save you about 5% or so on your premiums.
We also will change your PIP(personal injury protection) to exclude work loss. Work loss is kind of a short term disability that can be paid to you if you are temporaraly out of work due to your auto accident. Now that you are no longer working then it makes no sense to keep this coverage on your auto insurance policy. Note that if your spouse is still working i recommend that you keep this coverage on your vehicle until all drivers are no longer working.
Unfortunately, you completely forgot another aspect that might save you even more money: Your auto insurance! If you recently retired (or if your driving habits have significantly changed otherwise) give us a call so we can adjust your auto policy to match your new lifestyle. You can actually ‘lose’ quite a bit of money in higher payments if you retire and don’t call your insurance agent. Here’s what to look out for:
Another way to save is to complete a Defensive Driver Class. You actually don’t have to be retired to benefit from this. Anyone 55 years young can take a class and save money on their auto insurance. These classes are offered by AARP as well as other providers in the area for a small fee.
if you can afford to do so you might want to consider adjusting your deductible to a higher deductible which will in turn the lower your monthly insurance payments. The best thing to do is to obtain a quote with and without to see if it makes financial sense to do so. (Your deductible is the amount of money you pay after an accident, before the money from the insurance kicks in.)
If you have an older car or a car that you barely use, but hesitate to sell, give us a call. We can help you evaluate the situation and make a recommendation on how to save insurance dollars while still providing you with adequate protection. Please be sure to give us a call before you decide to drop any coverage.
As you re-evaluate your auto insurance during retirement, please be very careful to keep adequate liability limits on your policy. The last thing that you want to happen is to be considered "at-fault" in an accident and be held responsible for a sum of money that exceeds your policy limits. Don’t jeopardize your retirement funds and don’t risk having to return to work!
We can help you set up a high-value insurance plan that makes the most of your insurance dollars and provides you with adequate protection and peace of mind during your sunset years. You deserve to enjoy them worry-free! Give us a call today 352-243-9000 for a free policy review.
Retirement and homeowner’s insurance
If you are fortunate enough to enter retirement and not have a mortgage, we always recommend to adjust your all other peril deductible to a higher deductible of a minimum of 1000 but preferably 2500. This is recommended for two reasons, first you definitely do not want to file small homeowner claims. your homeowner policy is actually set up to cover the major catastrophe claims and not the smaller event claims. When people call my office and they have 2 or more claims it is very difficult to find coverage for those individuals. if we can find coverage it usually ends up being a higher risk policy as a result of the claim activity.
Secondly, having a 2500 deductible will save you about 10% on your premiums. So by doing so this will be a win win for you in the long run of having a homeowner insurance policy.
In addition, it is important to regularly review your homeowner’s policy to ensure that the value of your home, rebuilding cost, and value of your personal property are still adequately reflected. Call us 352-243-9000 anytime for a policy review. We are happy to help you with this (And if your policy hasn’t been reviewed since you signed the mortgage documents, it is high time to schedule an appointment with us!).
I’m a “snowbird” – how do I need to set up my insurance?
if you are a snowbird then we offer the perfect Clermont homeowner insurance policy for your home. These policies are called secondary or seasonal residence policies. This just means that you are not living in the home full time due to your dual residence status. Not all carriers offer this type coverage but rest assured that you are in good hands with the professionals at Southern Insurance Group. Give us a call and we will set up a policy for your today.
We can help you with that. Just give us a call, and we’ll help to coordinate the Here and There and Where and What for you, when it comes to your protection plan.
Unfortunately, things tend to get a little complicated when it comes to insurance plans that cross state borders. To make it a little easier, let’s split this question up into various insurance scenarios:
Homeowner’s Insurance
Let’s assume that you own a home in Florida State and would like to purchase a second home in California. That may trigger a variety of questions: Where is your primary residence? In which state should you get insurance?
Your primary residence is the residence that you spend most of the year in. Let’s assume, in this example, that this is the Florida home. It needs to be insured in Florida by a company and agent that are licensed in Florida (We can help you with that!).
If you purchase a second home in California, it needs to be insured in California (through a company or an agent who is licensed in California). If you are looking to find an agent outside of Florida, please give us a call. We can recommend insurance agents in all 50 states. We are happy to help!
Auto Insurance
Let’s continue to use our example of Florida and California.
If you own one or more car(s) at your primary residence in Florida, they need to be insured in the state of registration. That is usually the state of your primary residence (In our example - Florida).
If you own cars that you are absolutely sure won’t be driven in your absence, you have the option to pare down the insurance in order to save money. Give us a call – we can provide you with recommendations and price quotes.
Be sure to keep adequate insurance on the car that you intend to drive and on any car that might be driven (for example, by your son or daughter who watches the house)! If an uninsured car ends up being driven and the driver causes an accident, you will be held financially responsible no matter who drove the car!
If you drive your car from Florida to California and use it there for the months you spend “snowbirding”, your Florida auto insurance policy will extend while you are away. But, as always, give us a call if you plan on spending an extended amount of time out of state so we can make the necessary adjustments to your policy and ensure that it meets the other state’s minimum insurance requirements.
If you purchase a car in California and intend to leave it parked at your secondary residence while you are back in Florida, you need to obtain registration and insurance for this car in California. We can help you find a local agent.
Umbrella Insurance
If you carry umbrella insurance in your home state, the policy will extend to cover the underlying policies no matter where you are. However, it will not apply for homes and cars purchased, registered and insured out-of-state.
Health Insurance
Whenever you leave home, be sure to contact your health insurance provider to ensure coverage at your destination.
Do I still need life insurance after I retire?
You just retired a few months ago and are sitting with your coffee on a rainy Wednesday morning reading the newspaper when your spouse comes in with the mail. There’s a letter from your Life Insurance Company. Your 30-year term policy is about to expire. If you’d like to renew, you have to re-apply for a new term.
Hm. You wonder…The mortgage is paid off. One of the kids is out of college. The other one will graduate in a couple of years...
There aren’t really any major expenses that your wife would face if you passed… except, of course, the cost of living, since her retirement funds are a little more meager than yours. Would she need the extra money if something happened to you? Would the kids need it?
There. You thought you had considered everything…But now you wonder: Do I still need life insurance after I retire?
You are not alone! Thousands of people are facing this question every year: “My term life insurance expired. Should I renew it?”
Unfortunately, the answer is not easy and depends on you and your family’s individual status. Sit down and answer the following questions:
- If you passed away, would your spouse have to make significant restrictions to the current lifestyle?
- Are you currently working part-time, which would be an additional loss of income?
- Are your debts paid off?
- Are your funeral expenses covered?
- Is your estate of a size that would trigger a tax burden to your family if you died?
- What’s the status of your retirement savings? Do you have enough savings to provide for your spouse for another 10, 20, 30 years?
When you answer these questions, you’ll have a better idea whether you still need life insurance during your retirement years.
Keep in mind that life insurance rates increase with age. If you had a term life insurance policy and find that you need to continue your life insurance during retirement, you will likely have to renew your policy. That requires you to re-apply and complete another medical examination. Unfortunately, we have to warn you: Be prepared for your life insurance rates to soar if you renew your policy at this stage in life.
You can save money on your life-insurance renewal by purchasing the minimum amount of coverage for as short a term as possible.
None of this applies to you if you have whole life insurance. Permanent, or whole life insurance remains active until you pass away.
A word of caution: We don’t recommend treating a life insurance policy as a savings plan for your beneficiaries. Consider a meeting with a financial planner for ways to optimize the investment of your money.
Please don’t hesitate to give us a call if you’d like to have more information about life insurance options at this stage in your life. We’d be happy to assist you!
Retirement and Long-Term Care Insurance
When you dreamed about the sunset years, you always saw yourself as a spunky, energetic retiree who climbed Mt. Kilimanjaro in her seventies, took the great-grandkids to the water park in her eighties, and passed away peacefully in her late nineties by means of falling off an apple tree while harvesting apples.
All that, of course, with no sign of major health issue or body parts refusing service.
But, unfortunately, you have to admit to yourself that this might not be the most realistic scenario.
It’s a fact that more and more retirees move to an assisted living community or to a nursing home. So, in order to plan your retirement and get your affairs in order, you consider long term care insurance. But, where to start?
As with everything that’s related to retirement, it helps to start planning early. There are various different types of long-term care, ranging from hourly in-home health care help to full-time nursing home care. And the price tag varies just as greatly, ranging from $8,000 per year to a hefty $75,000 per year for full-time nursing home care in some places.
Who is going to pay for that?
Unfortunately, long-term care is not covered by health insurance. You are responsible to pay the expenses for assisted living or a nursing home out of pocket. This is where long-term care insurance comes into play. It can protect your assets, your savings and your inheritance.
The earlier in life you start planning, the lower are the rates you pay. Consider this: If you purchase long-term care insurance in your seventies, you might likely pay monthly rates that are six times higher than if you had purchased it in your fifties!
The question is, are you really going to need long-term care insurance? Consider chronic diseases and family history. If you rely on family members, don’t just assume. Talk with them.
If you have sufficient funds and investable assets to carry the cost of long-term care yourself, you may opt to self-insure rather than investing in a long-term care insurance plan. To determine your individual financial situation, get advice from a financial planner and obtain quotes from a variety of long-term care insurance providers several years before you retire.
As you consider long-term care insurance, it also plays a role whether you are single or married. If you are single and can, for example, sell your house to finance the living expenses in a nursing home, you may have sufficient funds. But if you are married, you may find that only one spouse needs the care of a nursing facility while the other stays at home. In that scenario, you can expect your living expenses to double in order to accommodate both spouses’ needs.
This topic does not lend itself to an easy answer. But with a little research and planning ahead of time, you can start your well-deserved retirement with peace of mind. Contact Southern Insurance Group today 352-243-9000 and let us help you to answer your important questions and arrange the best possible insurance options for you.