Is it time to Re-evaluate your Financial Plan?

By
Jeff Motske, CFP®
February 14, 2022
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Re-evaluating your plan and re-evaluating your opportunities is really important. According to Northwestern's 2020 Planning and progress study, 71% of Americans feel their financial plan could use some improvement. So maybe you have a plan, but you're saying, “Maybe I can use some improvement”. At Trilogy Financial we look at the work that's been done in the past. Remember that we're not judging what was done in the past, but we'll look at that and say, is there any way that we can make improvements upon what's been done in the past to help you plan for the future. Understanding that is really important. A plan is not static, it's a living, breathing document, and you want to make sure that you're updating and reevaluating your opportunities on a regular basis.

Another thing to think about is interest rates is we don't know what's going to be in the future. I think this is an interesting one as well. Many Americans for 2020 stayed at home a lot and a lot of them spent less money. Matter of fact, Northwestern Mutual did a study for 2020 on average, people say it's about 10% more money in their personal savings than they did in 2019. Well, why didn't they spend? Some of it was lifestyle – they didn't go out to dinner as much; they didn't go on their vacations- there’s a lot of things that were held back due to all the craziness that had gone on. But there were people that spent on home improvements in other areas as well. People were spending more on their houses because they were living in their houses more. There's a lot of people that saved more or in that period. You might want to evaluate what to do with that savings. Maybe that's the first step in building out a financial plan. Maybe that's the money that should be put towards the college plan. Maybe that's the money that should be put towards lowering your debt overall. Maybe that's money that you should use to increase your path to financial independence. Re-evaluating your opportunities, your long-term financial plan.

I would highly encourage you to re-evaluate those opportunities again. At Trilogy Financial, we do that all the time. We look at current plans and make sure they make sense. Then when you have extra money that's saved, we look at is it working hard for you and is it working hard for your financial why. Maybe you're in a place where you can refinance. Saving money, and refinancing is another really good tool to help create more cash flow and help you get on that path to financial independence.

I'm big on this thing called Financial date nights. Earlier, I talked about the fact that people argue about money, financial date nights once a month, get out of the house, go do something different. I've had people do financial date drives that live in big cities – go have a cup of coffee, have dinner, whatever it is. Get out of the house and talk about your financial whys, talk about your planning, and talk about your goals. Don't argue about them. This is an opportunity for big picture, global type discussions within the couple and then work through those things. And when you need help and more clarity, that's where a financial advisor can really jump in and help you jump-start whatever is going on in your financial plan.

Another thing is to be flexible and willing to adapt. I said this earlier but good financial plans are living breathing documents. In regard to this, all of our clients at Trilogy Financial have their own portal. Inside that financial portal is their financial plan that updates on a regular basis. We can put paperwork in there or documents in there and it's something that's living and breathing. You may need to be flexible with what's going on in your world. Timeframes constantly are getting adjusted. We've had people come in and say, “You know what? I'm thinking about retiring early” or “My companies offering me an early retirement package.”, or “I have to work a little bit longer” for whatever reason. That's just something you update in the plan. College scenarios too. Some kids are deferring going to college and I don't blame them. You didn't pay for online college, and you may want the experience. If that’s the case, you’d go in a different direction. Whatever those things are, be willing, flexible, and adjustable and in communication with your spouse, your partner, or business partner.

Meet and talk with your financial advisor regularly. They should be asking you those questions and they will be updating you on the markets and current events. what I would say are the unknowns or the instability side. The other thing about having that advisor is that joyful accountability. Have an advisor, have a coach, have a financial team – they'll help you stay accountable to do what you say. They're not going to be bugging you, they're going to be reminding you of the good things that you've said during those planning discussions. They're going to be reminding you where you are and they're also going to be praising you when you're doing what you said you were going to do. And when you do that, you make great progress, and when you make great progress, then the plan progresses year after year after year.

How much closer are we to financial independence, that's the conversations that happen over time. So, take action on what you can do, be in control of your knowns, and plan for the unknowns. Again, insurance is a great thing for that. Work with your advisor on the unknown, so you have less anxiety. Be flexible and will be willing to adapt and remember the financial planning documents and plans are living, breathing documents. Life happens, life events happen, and you've got to plan for those things. If you're not working with a trust or a financial advisor investment fiduciary, look to find one that can help you build your own personal plan.

 

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By Trilogy Financial
July 23, 2019

Like many in my generation, I prefer to subconsciously minimize the odds that I’ll become ill and ignore the reality that I’ll eventually pass. Unfortunately, the harsh reality is that illness and death are inevitable. Enter another subject we tend to ignore: Life Insurance. For many Americans – particularly young and/or single adults, life insurance is nothing more than a plot point in a Hollywood movie or true crime drama: the money collected by remaining relatives after someone has passed. However, life insurance, like health insurance, is just something you need to have. It can provide financial security for your loved ones, cover end of life expenses, and can even provide tax free income.

There are two different types of life insurance: temporary and permanent. The most common form of temporary insurance is Term insurance. Term typically lasts for a specified “term” of years, hence its name. Permanent – on the other hand – stays with you for your entire life, provided you continue to pay the premium, or have developed an account value large enough you no longer have to pay in. There are a wide variety of insurance policies available under the permanent life insurance umbrella, such as: whole life, universal life, variable universal life, and indexed universal life.

To put in another way, Term insurance can be thought of as renting insurance. You pay a monthly premium for the coverage but once the specified term of time is up that coverage goes away. The term can vary from 5 years up to 30 years. With some companies you can continue the policy, but you will have to pay premiums that are a multiple of what you had been paying during the “term” of the contract. It is used to provide protection for liabilities that will disappear after a certain time period ex: raising children, your mortgage, or income replacement. In your 20s-50s you have more people depending on you; therefore, if something were to happen to you (e.g. illness, death) you need an insurance policy that will take care of the people you support. If you pass away, you need enough coverage to pay off any existing debt, provide income replacement, and cover any other miscellaneous expenses associated with supporting your family. This coverage makes a difficult time a little bit easier by reducing the financial burden and allowing loved ones time to grieve without worrying about impending bills. Term insurance is perfect for this type of coverage as it has the lowest premiums and can be structured to disappear once certain liabilities disappear (e.g. mortgage is paid off, kids are out of the house, and your income is no longer critical to the security of your family).

Permanent Insurance, on the other hand, can be framed as owning the insurance coverage. As with term insurance, you pay a monthly premium; however, the coverage stays with you for the rest of your life, not just a specified term of time. Once your family is out of the house and your liabilities are decreased you still want to maintain some level of insurance coverage to cover end of life expenses and provide for loved ones. Permanent insurance is a great choice to cover these remaining liabilities. The premiums for permanent insurance are higher than those for term insurance because, unlike term – where the insurance company may not ever have to pay out the policy- permanent insurance means a guaranteed payout – assuming you’ve paid the premium. At some point the insurance company will have to pay. Additionally, part of these monthly premiums are placed into a cash value account which, depending on the type of policy, earns a fixed or variable rate of return and can provide tax free income. This income can be used to fund an early retirement as it can be accessed prior to age 59 ½ – the age required to legally withdraw from retirement plans without incurring penalties.

But what if you want to access the death benefit in an insurance policy without having to die – sound too good to be true? In fact, some insurance policies allow you to access death benefits before actual death! These policies feature Accelerated Benefit Riders (ABRs) which allow you to accelerate (or, in other words, use) the death benefit while still alive to cover certain terminal, chronic, or critical illnesses. Unlike health insurance, which only reimburses medical expenses, ABRs provide tax free money for you to use as you wish, assuming you have an ABR event. You can use this money for experimental treatments that health insurance will not cover or use it to travel the world. There are no restrictions on how the money is spent.

Now you know about life insurance and the many different options and benefits available to you – consider working with a financial planner to discuss the right life insurance policy for your needs.

If you have questions about insurance or any other aspect of your financial life please do not hesitate to reach out to me at zach.swaffer@trilogyfs.com

This article contains only general descriptions and is not a solicitation to sell any insurance product or security, nor is it intended as any financial or tax advice. For information about specific insurance needs or situations, contact your insurance agent. This article is intended to assist in educating you about insurance generally and not to provide personal service. Guarantees are based on the claims paying ability of the issuing company.

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.

By Trilogy Financial
April 18, 2022

Financial advisory firms have historically endured a bad reputation ­– either because they were too expensive, or they only helped people with lots of money to invest, or they were trying to sell clients a product or plan that didn’t align with the heart of their goals and situation. Too many Americans don’t think they can afford a Financial Advisor and planning services. Too many of them avoid partnering with an Advisor because they don’t think they have enough money to meet some criteria. But those are often the people who could benefit from a financial coach the most! It’s also the largest population in America. That’s why we founded Trilogy Financial almost 30 years ago – to provide a true fiduciary and financial coach to everyday Americans who want to live the best life possible. Our goal at Trilogy was to create something different, something people hadn’t seen before. And over the last 25 years, we’ve been evolving the firm and honing our practices to improve the financial planning industry and make an Advisor accessible to everyone.

A Purpose Driven Financial Advisor and Coach

In Trilogy Financial’s beginnings, our vision and purpose was to help Financial Advisors be better Advisors so they could help more people. However, as time has gone on, that’s evolved into something bigger. Now our purpose is to help everyday Americans gain financial independence. They are the group of people that often struggle to achieve their financial goals, and we want to focus and help those that need advice. This is the culture we’ve built today. Our Advisors want to help as many people as they can, and we’re on a mission to make those Advisors more productive so that can help provide more for our clients. That is purpose-driven business.

How to Make Financial Advisors More Productive For Clients

Most financial advisory and planning firms have an advisor-led service model, and there’s nothing wrong with that – except that not all Advisors have service as their strong suit. As a Financial Advisor, many people perceive our job is to advise people how to save and spend their money. But we believe it takes more than that to make an impact. We’re striving to build what we call a “trust transfer” where our Advisors spend more time advising clients, building Life Plans, and making recommendations, and a service team does what they do best. This is how we’re optimizing our operations at Trilogy for the benefit of our clients. This service team consists of a group of people with a distinct culture and skillset that will deliver great, helpful service to our clients. This is contrary to what’s “the norm” for financial advisory firms – and that’s exactly why we’re doing it. This is part of our efforts to bring quality financial planning and advice to everyday Americans.

Introducing the Mack Service Center

The Mack Service Center is a robust client experience service center that was Trilogy’s late co-founder Kevin “Mack” Mackintosh’s vision for the firm. His core focus was to build a meaningful client service team to support Advisors so they could do what they do best – financial planning – and provide the clients with a high quality experience. Mack designed and developed the Trilogy Service Team based on what he learned over the years as an Eagle Scout, rowing crew member and in his time in the financial planning business. From day one, he had a clear vision of what Trilogy could accomplish when we all worked together and focused on service. A few years back, he took the ball and really got it rolling for this project. He found the right people to lead it and get it off the ground. Right before his untimely passing in early 2020, he had nearly completed building the Service Center team vision. Following his loss, under the leadership of our founder/President, Jeff Motske, in conjunction with Eric Perkins – we built out the actual Service Center, team, outlined processes, operations and more. Kevin Mackintosh instilled the right attitude, built the right culture and we’re proud to name our Mack Service Center after him so his legacy lives on.

The Future of Trilogy Financial and the Mack Service Center

 Our goal is to have a well-regarded Advisor in front of every everyday American.  Too many financial advisory firms want to work with high-net-worth individuals, but it’s those who are 52 years old with $400,000 in their retirement who really need our support and education to get to where they want and need to be. These are everyday Americans, and they deserve for someone to help them pursue their dreams. And we’re changing that. We rolled out the Mack Service Center team this year to support our Financial Advisors’ current planning efforts with each client. This is our way of connecting the financial planning industry back with the real-life issues of Americans and helping each of them plan and live the life of their dreams.

Get Started on Your Financial Life Plan Today