Whether we want to admit it or not, most of us are victims of debt at one level or another. This unfortunate situation is only expected to get worse. According to analysts, most individuals in the United Kingdom will be burdened with no less than £47,000 pounds of debt by the year 2020. This equates to an aggregate amount of an astounding £2.5 trillion pounds. As opposed to always keeping the collection agency at bay, successful Forex traders can now leverage their strategies and wipe away this debt over time. How can this be accomplished?

Patience is a Virtue

Monumental amounts of debt cannot simply be wiped away with a few trades. Not only is this an unrealistic expectation, but it could also be very dangerous. Those who opt for short-term solutions will often expose themselves to unnecessary levels of risk. It is critical to determine the approximate returns that are expected over standard periods of time (such as months or quarters). These goals can then be tackled piecemeal.

All That Glitters May Not be Gold

Trading platforms come in all shapes and sizes. Of course, not all are equal. Choosing only the most up-to-date and streamlined system is another core component of Forex success. The architecture provided only through CMC Markets is a perfect example of the marriage between form and function. With over 80 technical indicators and thanks to dozens of currency pairs to choose from, the most efficient strategies can be chosen. Thereafter, it is possible to begin chipping away at a mountain of debt.

Small Profits for Big Returns

The basic principle that is adopted by professional Forex traders is that profits need to be accrued over time. This is directly opposed to the myth that “going large” on a single trade is the most prudent way forward. The weight of one pebble is negligible. The aggregate mass of a bucket full of stones is significant. This perspective holds just as true within the world of currency trading. Small returns can quickly add up.

Sustainability

Sustainable trading is associated with not having to deposit additional funds to prime a personal economic “pump”. The only way that a sustainable approach can be enjoyed is to limit the amount of capital put forth within any given trade. In fact, this can be as low as a few percentage points of one’s net account. Regardless of the temptation, it is never prudent to place a lion’s share of liquidity into a single position. This will help to sustain a lucrative position well into the future.

Margins?

Margin trading can be an extremely powerful means to leverage a small amount of capital and transform these limited funds into a massive return. This vehicle is not without its share of risks. Namely, more money can be lost than was initially deposited. Margin trades are excellent options, but be certain to have stop losses in place and to always appreciate the inherent volatility involved.

{ 0 comments }

All too often people avoid buying life insurance because they simply cannot afford it. However, it might be that you cannot afford your ideal life insurance policy, but you can afford something for less. The following article will cover money saving tips when purchasing life insurance.

Fifteen money saving tips when purchasing life insurance

  1. Buy cheap term life insurance

Life insurance comes in three main flavors: term, whole, and universal life. One of the best ways to save money on your life insurance premium is to purchase term life insurance. Here is a brief description of each type of life insurance.

Term life insurance is designed to last for the term of the policy. Usually, the term can be anywhere from 10 years up to 30 years. You can even find a 35-year term policy with a return of premium rider. Typically the premium is fixed for the duration of the term with the ability to renew on an annual basis. However, because the policy ends at a specified time (the term) your premium will be less than a product that lasts the rest of your life, such as whole or universal life insurance.

Whole life insurance lasts the rest of your life. The policy builds cash value. Typically the premium and face amount are fixed for the life of the primary insured. You can borrow against the cash reserve. Any interest owed on the money you borrowed against will typically be repaid from the death benefit when you die. And for those who want permanent coverage, single premium whole life insurance saves you on the cost of protection.

Universal life insurance is a permanent policy. It is very similar to whole life but has more flexibility when it comes to the payment. There are three main types of Universal Life: Guaranteed, Indexed, and Variable. Guaranteed Universal Life typically has a fixed premium amount. Indexed Universal Life has the premium you paid tied directly to a benchmark, such as the stock market. So if the market does well you pay less and vice versa. Variable Universal Life allows the owner to invest the policy into various investment vehicles which can make the premium and cash reserve go down or up depending on the performance of the investment index the policy is tied to.

You might need life insurance for the rest of your life. In that case, term will not be the best choice. However, you cannot beat cheap term life insurance for the savings it will provide compared to Universal or Whole Life.

A word of advice when choosing the type of life insurance for you: You need to consider how much life insurance you need today, not some hypothetical day in the future. All too often people get hung up on cheap term life insurance because they are too fixated on what may or may not happen once the term expires. The problem is this misses the point of term life insurance. Term should be used to meet your needs in the here and now.

For example, if you know your family needs $500,000 of life insurance proceeds to pay off the mortgage then you should get $500,000 of coverage. What tends to happen is people will purchase $100,000 of whole life instead of the $500,000 of term they need because they are too focused on the term expiring and “then what?” But consider if that person dies in a few years or few months from now.

That $100,000 policy is not going to do the job. And further, how much will $100,000 be worth in 30-40 years when the insured dies? That is why a healthy husband or wife age 40 and younger should consider a million dollars of life insurance. The idea is to buy the amount of insurance you need in case you die today and deal with the future when it comes.

Pro tip: here’s another useful resource that you might also find helpful when deciding which insurance companies to consider (you can also check the full-length content version of the best life insurance companies in US infographic here):

Life

  1. Have your beneficiary or beneficiaries pay for it

Another great way to save on the cost of life insurance is to have your beneficiary pay your life insurance premium. Often older clients will be saddled with a high premium that makes paying life insurance painful. As a result, many people will simply let the life insurance lapse, cash it in, or sell it for a life settlement because it does not fit into the budget. But a good idea would be to see if your life insurance beneficiary will help or completely pay the premium. After all, they are the one who stands to benefit from the policy. Why shouldn’t they help pay it?

  1. Stop smoking

An important money saving tip on life insurance is to know the requirements of getting a non-tobacco rate class. As you may already know, smoking and life insurance are poor bedfellows. Typically, the premium is three to five times higher for a smoker compared to a non-smoker. To save on your life insurance, you will need to quit for at least one year. There is a company that will offer a preferred rate class after one year of no tobacco use. But you need to quit for at least one year to qualify for a non-tobacco rate. For those of you who use other forms of tobacco besides cigarettes than make sure you apply with a company that has favorable underwriting for tobacco products other than cigarettes. And if your tobacco product happens to be marijuana, make sure you apply with a marijuana friendly life insurance company.

  1. Get healthy

Easier said than done, we know. However, many steps can be taken today that will help you qualify for a much better rate class down the road. And going from one rate class to another can save you between 10-25% on your premium. In fact, the difference between a preferred plus rate class and a standard rate class is typically 200%.

The two primary contributors to getting healthy are diet and exercise. Think baby steps. You don’t need to run a marathon or go vegan. Instead, take small steps to improving your diet and fitness. For example, you could cut down on the fast food you eat or take an evening stroll around the neighborhood in the evening. You would be amazed at how a few small changes can make an enormous difference over time.

If you are currently working on getting healthier but you need life insurance today, consider a cheap term exam or no exam life insurance policy. A 10-year term will provide ample length and you can easily re-apply for life insurance once you have reached your desired health goals six months or so down the road.

  1. Pay annually

Here is an often overlooked tip for saving money when purchasing life insurance that adds up over the years. You receive price breaks by paying less frequently. For example, the best way to buy life insurance is with a single premium policy where you put down a large sum of money to purchase an even larger death benefit. Single premium is a great deal for some who have a lot of liquid cash but for those of us who do not have an extra $50,000 or more lying around, there are still ways to save money.

The lowest premium is the annual premium. Paying your premium once a year will provide you the most savings, followed by semi-annual, then monthly and then quarterly. Yes, quarterly is the most expensive way to pay for your life insurance.

  1. Buy it while you are young

Age is the primary factor that a life insurance carrier will consider when determining your premium. The reason is, the actuarial tables that an underwriter looks at considers your life expectancy above all else. Therefore, the older you are, the closer you are to that fateful day. Therefore, the younger you are, the more money you will save on your life insurance.

For all you 20, 30 and 40-year-olds looking for cheap term life insurance, there is no time like today to lock into a policy. Once you get into your 50s, life insurance premiums jump up around 5-10% year over year.

  1. Avoid Dangerous Hobbies

The dangerous hobbies that do raise a red flag for life insurance companies will either make your premium go up, require an exclusion, or cause your application to be declined. And you will have to wait two years after quitting the hobby to qualify if you do engage in particular dangerous hobbies. For thrill seekers, refraining from dangerous avocations is not realistic. However, if you don’t regularly participate in adrenalin sports and have plans to purchase life insurance, don’t go skydiving or make plans to go skydiving before you secure that policy.

  1. Consider the term length

Here is another great tip to save money when buying life insurance. If you are pressed for cash because your monthly budget is precarious close to swamping you but you want life insurance to protect your family as their primary income source, then consider a shorter term length. There are two distinct advantages to doing so.

One advantage of a shorter term length is the premium will be less because the chances of you dying in 10 years or 15 years is less than you dying in the next 30 years.

Also, most term policies come with an additional life insurance rider called a conversion option that will allow you to convert all or a portion of your policy into a permanent policy at your original rate class. That way, even if you do come down with some condition that precludes you from life insurance, you can convert your term policy to a permanent policy with no proof of insurability.

Further, you can always add additional coverage or buy a new policy when you are not so financially strapped, but at least you have some life insurance in the interim.

Also, be aware that some life insurance carriers offer term coverage for every year from 15-30. That means 16, 17, 18, 19, and so on. So you can tailor a policy to your particular need.

  1. Actual age versus insurance age

Some life insurance companies will use your nearest age to determine your life insurance “age”. How this works is the life insurance company will date you at the age you are closest to. So if someone 44 years old was born in August and they apply for life insurance in March, that person is one year older for life insurance purposes because they are nearer to turning 45, rather than 44.

Now you can backdate the policy to save age but you will end up paying more premium up front to do so and it is not in everyone’s best interest to backdate although at times it makes sense.

Other companies will use your actual age. That means as long as you apply and are approved for life insurance before your birthday then you are your actual age. If you have a birthday during the underwriting period, than you are your new age for that insurance carrier. Therefore, you want to make sure you applied with an actual age company with a few weeks or months to spare to lock into your current age.

The difference between the costs for an actual age company versus a nearest age company will probably be a few dollars. However, for longer terms, such as 20 or 30 years, that will amount to thousands of dollars of savings on life insurance premiums. It pays to know which company to choose.

  1. Know your insurance companies weight chart

Different companies have different build tables. Your build is your height and weight allowance that a life insurance company will use to determine your rate class. Another way to say this is that some companies allow for a larger body mass index than others.

The key for overweight or big boned clients looking to save on life insurance is to apply with a carrier that has a more liberal build chart. As we mentioned above, the difference between rate classes can save you 10-25% on your premium. That is sizable savings over the life of your insurance.

  1. Buy in bulk (discounted rate bands)

Life insurance companies bundle policies in much the same way that a company like Costco bundles its food. You receive a price break when you buy more life insurance. Face amounts $0-249,999 are in the lowest band, although some companies have it $0-199,999. The next typical band is $250,000-499,999. There is a price break at $500,000-749,000 and then another price break on cost per units at $750,000-999,999. Another price break on cost per units at $1,000,000-1,249,999. Therefore, a great way to save on life insurance is to inquire into that specific companies price breaks.

You might find that your $700,000 policy actually costs more than a $750,000 policy because the larger policy had a bigger price break on costs per unit.

  1. Take an exam compared to a no medical exam policy

If every penny counts, then this is another awesome tip for saving money when purchasing life insurance. Life insurance companies want to get a complete picture of who the company is offering life insurance to. Therefore, taking an exam provides a company a complete picture of your health and lifestyle.

As a result, exam policies (called “fully underwritten”) are less than a no exam policy. For those of you with a fear of needles or that have superior health, there are still affordable life insurance companies available that do not require an exam. It is these instances when the premium is very close or when it makes sense to choose a no exam policy versus an exam because of a potential health issue not yet discovered that a no exam policy can save you a lot of time and money.

  1. Consider a second-to-die policy

If your goal is to leave money to your estate, then a survivorship life insurance policy might be right up your alley. With a second to die policy, the premium is lower, up to 40% lower in some cases, than buying coverage on an individual. The reason being, both spouses have to die for the policy to pay out. But if neither spouse needs money, an excellent way to increase an estate and pay any estate taxes is with a second to die life insurance policy, perhaps in an irrevocable trust.

And a second to die policy can be purchased on two business partners, siblings, and many other potential scenarios as long as there is an insurable interest. Buying coverage on two business partners is a great way to create a business succession plan with life insurance, such as funding a buy sell agreement, or key man business insurance.

About the Author: TermLife2Go is a life insurance agency dedicated to making the process of obtaining life insurance as easy as possible.

 

{ 1 comment }

When purchasing Punch Debt in the Face we didn’t realize how strong the community still was given Ninja’s lengthy absence.  To say it is amazing is an understatement! At the current time my partner and I are not in the “punching debt” phase of our personal finance journey…but many of the readers may still be, and we want to hear from you.

We are interested in people who want to share their story either on an ongoing basis or even a one-time post.

Getting in Contact

You can either use the contact page or email me directly at ninja@punchdebtintheface.com.

 

 

{ 0 comments }

While talent and skills in couponing and investing are important when it comes to personal finances so is trying to make a side income.  This is where my old Spreadex spread betting account comes in – for some day time trading and investing to make my profits go that much further, especially if your spouse has to stop working.

Budget plans are the cornerstone of any personal finance and most of the time you shouldn’t generally doesn’t stray from safe investments to get out of debt, but with the right amount of patience and insight, trading isn’t as much of a gamble as some people would like you to believe. Here are just a few tips to start with for the year:

  • Commodities – I’m sure most of you know about Oil, Gold and what a commodity is, but what some of you may not know is that these can be traded on either throughout any given day or over a future price (futures). Take Oil for example – the price tanked since 2014 and has only just started regaining some of its’ value. Sure that’s bad for my weekly budget with fuel costs going back up, but it can also be a great investment to get involved with – especially if you keep up to date with OPEC and the oversupply America has which heavily affect its’ price tag.
  • Money/Forex – The Dollar is in a pretty sweet place at the second. With countries like the UK facing an identity crisis (Brexit), the Pound is down against the USD at nearly $1.43/£1 compared to last years’ $1.58/£1 but they vote in May to stay in/out the EU and that means there will be some volatility in the markets. This is a great chance for someone with the patience to wait till the right time to make a nice profit.
  • Crypto Currencies – You may have heard of something called Bitcoin as the payment method that real pirates like to use, but it is now a pretty solid investment. Nearly doubled up in value since last year from some $220 to over $440 per BTC, this has been a crazy winner for those lucky enough to have gambled on it. Although it isn’t available to trade at with all sites, you can find out which ones have the options through a review site like reviews.spreadbetting.

There’s also a ton of other things to look at but for now that should be enough to help most of you get a start on punching debt in the face. And remember to read up on things like stop losses in spread betting more if you decide to try it out as you don’t want to find yourself in more debt that when you started!

{ 2 comments }

How to Avoid Debt When Investing

April 25, 2016

Whilst there are plenty of investors out there who are happy to accrue an amount of debt when starting off (be it down to hubris or confidence), if you’re just getting into trading you’re likely to be fairly debt averse. But you don’t have to get into debt when investing. If you’ve managed to place […]

1 comment Read the full article →

Give Your Wallet the Boost it Needs

April 22, 2016

It happens to everyone at some point in their lives. They open up their wallet or look at their bank statement and the money they need isn’t there. It may only be a matter of time before it happens to you too. Why you end up in that circumstance isn’t necessarily important. It can be […]

1 comment Read the full article →

Think Twice: Crucial Considerations before You Make a Career Change Decision

April 16, 2016

You’re stuck in a career that does nothing for you, and you keep hearing that you’re supposed to do something that you love if you are to be successful. What do you do, though? A career coach may be able to show you the way, but it can help to put in some work yourself. The more […]

Read the full article →