The other day I got a tweet from my brother-in-law Brennan (who’s an awesome guy and runs a travel blog if you’d like to check it out, though you should first make sure to hide the women and children).
Anyways, the tweet looked like this:
This is a really important question because it’s the kind of thing many people worry about when they start investing. As my friend Jason writes, the fear of a market downturn is a big reason why many people avoid investing altogether, or simply don’t take advantage of it as much as they should.
But there are two very simple assumptions underneath this kind of thinking, both of which need to be challenged:
Last week we talked about the importance of disability insurance and why it’s such an important part of building a secure financial base for our families.
As a quick reminder, disability insurance will pay you monthly income in the case that you become disabled and are unable to work. In other words, it’s insurance against the loss of income due to poor health.
And as we said in last week’s post, if there’s anyone that relies on your income, including you, then there’s a need to insure the ability to earn that income.
There are a lot of variables to consider when looking at disability insurance, and with all of the different terms it can quickly get confusing. Today I’d like to explain some of the most common and important characteristics of a disability insurance policy so that you can make a more informed decision when evaluating your options.
This is a guest post from my friend and life insurance expert Gary Dek. Enjoy!
Is life insurance necessary? Almost every American has asked themselves that question, perhaps multiple times during their adult lives. When do you start needing life insurance and, if you’ve decided you do, what type of policy and how much of a death benefit should you buy. Even if you plan on discussing your financial plan with an advisor, it is important to answer these questions for yourself.
Why Buy Life Insurance?
For the right consumers, life insurance coverage is essential because it can keep their loved ones from financial hardship if they pass away prematurely and can’t help support them. Life insurance is primarily a form of income replacement – if others are financially dependent on your contributions to the household, you most likely need to buy protection.
Each Saturday I’ll be sharing some great articles from other sites on personal finance, investing, parenting, and whatever else interested me throughout the week. I think you’ll enjoy these as much as I did.
Hope you have a great weekend!
My Money Design: MMD does an incredibly thorough breakdown showing just how much better it is to save within a 401(k) as opposed to a traditional retirement account. The detail is really helpful and makes the advantage incredibly clear. And although the comparison isn’t exactly the same, some of the biggest points apply if you’re talking about a Traditional IRA vs. a Roth IRA as well. There are BIG tax advantages to a Traditional account that often get too easily overlooked.
Note: Last week I promised to follow-up my post on disability insurance with an explanation of the things you should consider when purchasing a policy. Given that it’s Thanksgiving, I decided to reschedule that follow-up for Monday of next week.
Happy Thanksgiving everyone! Or, if you’re not in the US, happy Thursday!
Typically we travel down to Florida to spend Thanksgiving with my wife’s big extended family. It’s really a great experience with everyone bringing their best dishes and tons of little cousins running around causing trouble. But given that my wife is 8 months pregnant, travel was not going to happen this year.
So today we’re driving the 30 minutes west of Boston to spend Thanksgiving with my parents, my three brothers and my Nana. This is special for me because as much as I love going down to Florida (and I really do), it’s nice to be able to be “home”. It should be a fun, relaxing, low-key day full of good food, football and of course an epic 2-on-2 all-brother basketball game in the driveway.
I’m a big fan of the “buy and hold” investment strategy, which essentially means that you choose your investments for the long-term and stick with them through the ups and downs. There is no trading or moving in and out of the market based on the events of the day.
But even a buy and hold strategy takes a little bit of maintenance. Part of that maintenance is the need to rebalance your investments every now and again.
Today I’d like to talk about the idea behind rebalancing, why it’s important for investing, and how you can do it simply.