The Role of Insurance in Financial Planning

By Trilogy Financial
March 28, 2023
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Financial planning involves thoughtfully outlining objectives and setting goals in your Life Plan. With anything, the possibility of running into obstacles, options, and challenges throughout your financial journey is unavoidable. That’s why it is important to implement some sort of checks and balances to mitigate these challenges. Insurance is one of the best ways to account for unforeseen conditions and events in your financial plan. The thought of utilizing insurance can be daunting. It makes the possibility of losing your car or home due to an accident, flood, or fire a reality. That’s exactly why we create a financial plan – to be prepared for the unexpected. Our team is committed to coaching you through the process, so that you can make an informed and confident decision. There are various types of insurance services available that your Trilogy Financial advisor can help you navigate so you can handle the many uncertainties that life throws your way.

Read on to discover these insurance services.

Insurance Services Provided by Trilogy Financial

Every Trilogy Financial Advisor is committed to helping you build the legacy you have always desired to leave through the following services:

Term Insurance

A term insurance policy is the most common form of temporary life insurance. The term usually lasts for a specific “term” of years. Term insurance is also a form of insurance that is rented. Meaning, you pay a monthly premium for the insurance, but it expires after the allotted time frame. The duration can range from five to thirty years.

Term insurance protects liabilities that will cease to exist after a specific period, such as providing extra cashflow for raising children. It is a simple life insurance plan that protects against the possibility of an untimely death. A death benefit is granted if the insured passes away during the policy's stated tenure.

Because death is unpredictable, term insurance plans are essential. The family may experience a significant financial loss if the family's primary provider passes away. A term plan covers the loss. It benefits the family, allowing them to cover lifestyle costs and continue to address their financial objectives.

Permanent Insurance

Permanent insurance can be considered “owning” insurance coverage. Like term insurance, you pay a monthly premium; however, in permanent insurance, the range is continuous and does not end within a time frame.

For instance, even after your children have moved out and your liabilities have diminished, you may continue to carry some form of insurance to cover your loved ones and compensate for your end-of-life needs.

Permanent insurance premiums are more significant than term insurance premiums because, unlike term insurance, the insurance company may never have to pay out the policy. Permanent insurance can be used as an income and an insurance tool. Both a death benefit and a cash value factor are included. You can access the money as the value increases by taking out a loan or a withdrawal, and you can terminate the insurance by withdrawing the cash value.

Long-Term Care Planning

Long-term care planning, at its foundation, entails ensuring that you or a loved one's needs are adequately met when they can no longer care for themselves. Therefore, as you age, having a practical plan becomes more and more crucial. While many maintain their independence well into their senior years, it never hurts to plan.

Any long-term financial plan should consider long-term care costs, especially if you are in your 50s or older. You are unlikely to qualify for long-term care insurance if you already have a disabling condition. Most over 75 applicants will not be accepted by long-term care insurance providers. Most persons who purchase long-term care insurance do so between 50 and 60.

Risk Management

Risk management entails recognizing, assessing and managing risk. A well-executed risk management program is built on a foundation of standardized risk assessments to assist businesses in prioritizing their risk based on its potential impact. This procedure will inevitably reveal hazards affecting the company's fundamental competencies.

As financial Advisors, it is a part of our job to help you navigate your financial well-being, which includes helping you mitigating certain risks. Identifying your risk factors is your first defense, followed by avoiding or limiting risks to your income and survivors. Insurance is your quality line of defense.

Importance of Insurance in Financial Planning

Here are some factors that make insurance an essential aspect of your Life Plan:

  • Financial assurance: You feel safe knowing that the insurance policy will cover the damages in the event of an emergency.
  • Tax advantages: Insurance lowers your taxable income and provides financial benefits.1
  • Risk protection: Insurance prepares you to deal with any financial loss you might suffer in the event of an unplanned circumstance.
  • Meeting your prerequisites: Several insurance policies are available to cover the various risks you can encounter.
  • Peace of mind: Insurance plans assure you that your funds will not be compromised in the event of an emergency.

*This information is not intended as authoritative guidance or tax advice.  You should consult with your tax advisor for guidance on your specific situation.

Why Choose Trilogy Financial

Your financial plan should be strategically in line with your insurance. Our Trilogy Financial Advisors use a comprehensive strategy to offer insurance policies tailored to your specific needs and Life Plan. We understand the risks you face and how to help improve your financial life. Our Advisors will work with you to develop a deeper understanding of your alternatives, pinpoint practical needs and make plans for the care you and your family deserve.

To help you build the life you’ve dreamed, we collaborate with the most reliable insurance firms with a track record of being financial secure and capable of paying claims.

Get Started with a Financial Advisor Today

Everyone has a distinct level of risk, and before purchasing insurance, it is critical to identify risks and establish how to limit the likelihood of them occurring. We understand that everyone has a varying level of comfort and experience in navigating finances and Life Plans. That’s why our Advisors are committed to being both a partner and coach to support you as much or as little as you need, so you can make the best decisions for you and your family.

At Trilogy Financial, our Advisors will guide you through your daily financial decisions to keep you on track and set you up for your real-life goals. If you have any questions concerning insurance or any other element of your financial life, get in touch or visit our website today to book a meeting with an advisor

 

happily discussing insurance plan after meeting with financial advisor
 

 

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By Trilogy Financial
August 1, 2023

A romance scam, also known as an online dating scam, is when a person gets tricked into believing they’re in a romantic relationship with someone they met online, when in fact their other half is a cybercriminal using a fake identity to gain enough trust to ask — or blackmail — them for money.

Oftentimes, a romance scammer starts on dating sites or apps. But scammers have increasingly started finding targets on social media, too.

After connecting with someone through a fake profile, the scammer will strike up a conversation and start building a relationship by regularly chatting with them. Once they start to trust the romance scammer and believe they have a truthful relationship, the cybercriminal will make up a story, ask them for money, and vanish.

Types of Romance Scams

Some of the most common internet dating scams include:       

Fake Dating Sites: Scam dating sites claim to be legitimate but are actually filled with scammers or underpopulated. These websites are created to mine your information.

Photo Scams: Scammers will convince their target to send their personal information in exchange for intimate photos.

Military Romance Scams: The scammer will pose as a military member, likely deployed. They build trust by using military jargon and titles, then ask for money to cover military-related expenses, such as flights home.

Intimate Activity Scams: The scammer connects with their target on multiple social media websites. Once they become closer, the scammer convinces them to undress and then threatens them with the recordings.

Code Verification Scams: Scammers will send a fake verification code through email or text, posing to be a dating app or website. Once clicked on, it will ask for their personal information, including Social Security number and credit cards.

Inheritance Scams: Scammers will make their target believe they need to get married in order to get their inheritance. In this case, they will ask them to help pay for something like airfare.

Malware Scams: Malware is also common on dating sites. In this case, the recipient will interact with a scammer who sends them a website that looks legitimate; however, it's a page that includes malware.

Tips To Avoid Losing Money To a Romance Scam

  • Protect yourself and older loved ones by raising awareness. Although this can be an uncomfortable topic, make sure you, your family and your friends are familiar with romance scams. The more you know about these scams, the better prepared you are to prevent being a victim.
  • Check in on older loved ones. Scammers are seeking to target those living alone or grieving the loss of a spouse as they are more vulnerable.
  • Limit what you share online.Scammers can use details shared on social media and dating sites to better understand and target you.
  • Do your research.Research the individual’s photo and profile using online searches to see if the image, name or other details have been used elsewhere.
  • Go slowly and ask lots of questions.Don’t let the individual rush you to leave a dating service or social media site to communicate directly.
  • Listen to your gut.If the individual seems too good to be true, talk to someone you trust.
  • Don’t overshare personal information.Requests for inappropriate photos or financial information could later be used to extort you.
  • Be suspicious if you haven’t met in person.If the individual promises to meet in person, but consistently comes up with an excuse for cancelling, be suspicious.
  • Don’t send money.Never send money to anyone you have only communicated with online or by phone.

Think you’ve been scammed?

  1. Stop communicating with the individual immediately.
  2. Talk to someone you trust and describe what’s going on.
  3. Report the incident to local law enforcement.
  4. Submit a fraud complaint with the Federal Trade Commission.

Dating scams can have devastating consequences on individuals seeking love and companionship online. It's crucial to be aware of the red flags and take necessary precautions to protect yourself from falling victim to these fraudulent schemes. Even if it’s too late to recoup losses, details may help others from becoming a victim.

 

By
David McDonough
October 30, 2019

FIRE, an acronym for “Financial Independence, Retire Early” is trending as a new financial lifestyle.  In a nutshell, FIRE promotes extreme savings in your 20s, 30s, and 40s, with the goal of being able to live off passive income from the accumulated nest egg much earlier than typical retirement age.  Some proponents suggest saving 70% of your income until you have collected 25x your annual salary, cutting your working years in half.  Extreme saving is not a new idea, but the phrase has taken off in the last couple of years, creating a cult following online.

Putting aside additional savings to fund a “work optional” lifestyle is a fantastic idea in theory, but most Americans would find it quite difficult to only live on 30% of their income without making DRASTIC changes.  If you are willing to downsize, live with roommates in a cheaper part of town, eat beans and rice, drive an old car/take the bus, and limit purchases, you could be successful at FIRE.  However, this level of deprivation may cause unintended sacrifices that impact your social life and happiness.

Our take on FIRE is to find your happy medium.  For example, you absolutely should increase your savings rate incrementally every year if you can afford to do so, but initially choose an amount that’s attainable.  To help you get started, these are the questions we encourage clients to consider:

1) What is your current cash flow?

Do you have a firm grasp on how much you spend on monthly groceries?  Going out to eat? Gifts at the holidays for friends and family?  The key here is to consider all expenses, not just big-ticket fixed items like your car payment or mortgage.  Once you have an idea of how much you are spending compared to household income, you can then evaluate your current savings rate.

2) Where can you cut back to increase your savings rate?

Can you meal prep on Sundays to avoid going out for lunch during the week?  Can you stay in to watch a movie instead of going to a theater for date night?  Are you willing to have a “no-spend” week?  Some people use tracking software (our firm provides EMoney to our clients) to help set up electronic budgets to alert you when you are close to going over set categories of spending. Alternatively, can you bring in additional income via a side hustle?  Can you work additional hours at work to qualify for overtime pay?  Make an honest assessment to determine where you could potentially improve your cash flow on a monthly basis.

3) Are you debt-free, or leveraging debt appropriately?

A mortgage with a low-interest rate is an appropriate means of financing a lifestyle you want, while potentially building equity via real estate.  If you still have student loans or credit card debt, though, your increased cash flow should go towards paying this off ASAP. Just make sure you have 3-6 months of living expenses built up in an easily accessible emergency savings account as well.

4) Outside of your emergency savings, are your accounts keeping pace with inflation?

Historically, inflation rates average around 3% annually.  This means that your purchasing power decreases, as the cost of goods increases over time. Remember when you could buy a Coke bottle out of a vending machine for a dollar? Your parents or grandparents may even recall purchasing a soda for a quarter!  That’s inflation at work. If you’re planning to retire early, this means you need to account for inflation over several decades. The best way to maintain your purchasing power is by investing excess savings in the stock and bond markets and taking advantage of compounding interest over time. A Financial Advisor can determine the best investment strategy for you.

5) Are your investments in a diversified portfolio in line with your risk tolerance?

Trying to time the market to buy and sell holdings is incredibly difficult to do.  Diversification via broader index funds and investing consistently (to take advantage of pullbacks) has proven to be a more successful investment plan for most Americans.  The concern with the FIRE movement is knowing how risky you can or should be with your asset allocation depending on your time horizon to retirement.  For example, if you are closer to reaching your retirement goal, you don’t want 100% of your assets invested in the stock market.   A comprehensive financial planner can help determine how much risk you should be taking on by looking at your finances holistically, and ensuring portfolios are rebalanced regularly according to your needs.

The road to early retirement is still a long one, so you’ll need to regularly evaluate your progress, reassess as needed, and don’t forget to acknowledge small victories!

Our advice is to push yourself to save more, without going to the extremes of the FIRE lifestyle.  If you would like additional accountability, Trilogy offers progress checks through our Decision Coach process more frequently than annual reviews.  And if you need a road map to help find your path to success, reach out with any questions here.

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. To determine what is appropriate for you, consult a qualified professional.

Get Started on Your Financial Life Plan Today