Guaranteed Asset Protection
In a flailing economy, few institutions offer guaranteed asset protection. Although recent domestic and foreign economic woes have hit the pockets of most American investors, savvy consumers are still seeking vehicles which shelter funds for future income. Dependency on long-term retirement savings bit the dust after many U.S. corporations folded and the American banking system nearly collapsed in the midst of rampant housing foreclosures and volatile stock markets. But there is still hope for consumers who want to build a more secure financial future. Rather than stuffing money under the mattress, consumers can find places to safely park long-term funds for guaranteed asset protection. While the American dream has always been built from nest egg savings, savvy consumers are considering ways to safeguard assets for the short- and long-term, until the economy stabilizes. Annuities, trusts, Certificates of Deposits, U.S. Treasury Bills, and precious metals are suggested ways to secure long-term savings. Single deposit life insurance policies also offer an excellent vehicle to guarantee that assets are not only protected but also easily accessible.
The drawback to investing in some long-term savings instruments is that depositors risk paying a penalty for early withdrawal. Individual Retirement Accounts (IRAs) require depositors to park funds until the age of 59 and a half or incur a hefty fee. 401ks, Roth IRAs, rollovers, and other bank instruments may fail to provide long-term funds in light of recent bank failures and mergers. High-yield CDs are also suspect in a faltering economy, since yields are largely determined by market fluctuations. Government-backed U.S. Treasury Bills and investments in precious metals such as gold, silver or platinum, may offer investors the safest and best hedge against inflation as guaranteed asset protection. Gold and other precious metals remain rock solid options for anyone seeking to protect liquid assets for the long haul; particularly since gold increases in value as the dollar and other commodities decline.
Individuals seeking guaranteed asset protection may invest in precious metals or mining company stocks. In spite of a woeful economy and declining commodities futures, mining companies may hold steady. Their profitability depends largely on the supply and demand for precious metals. Investors seeking to diversify portfolios or gain assets that won't fade away with the next wind of untimely bank failures, may seriously consider accumulating gold, silver, or platinum coins. As a secure, collectible investment, American Eagles and Buffalos, Canadian Maple Leafs, and South African Kruggerands hold or increase in value, are highly portable, and can be used as currency in a pinch. Gold bullion is also highly collectible currency which provides protection for liquid assets. "In the light of the king's countenance is life; and his favour is as a cloud of the latter rain. How much better is it to get wisdom than gold! and to get understanding rather to be chosen than silver!" (Proverbs 16:15-16).
Some American workers that trusted in corporations to safeguard retirement funds have been left high and dry; and many lack sufficient time to amass monies before reaching the age of 65. Workers who have some savings may consider converting cash into single premium life insurance policies, which provide guaranteed asset protection. Interest-earning single premium policies are purchased with a lump sum payment, which can instantly be valued at twice its initial worth. A typical policy purchased for $200,000 can represent a cash benefit of $400,000 to survivors; monies that will help family members maintain the standard of living to which they are accustomed. Policy holders can choose to accumulate long-term financing for beneficiaries' college funds or use policies as savings vehicles. While funds are not FDIC insured through a bank or lender, underwriters are obligated to pay one hundred percent of the policy's value in the event of the death of the insured. Beneficiaries are also exempt from paying tax on funds, unless monies become part of the insured's estate.
The beauty of single premium life insurance is that monies can be withdrawn in the event of a catastrophic accident or chronic illness. Policy holders can withdraw and utilize funds without worrying about taking out a second mortgage or incurring high-interest credit card debt. People are living longer, healthier and more productive lives; but funds that have traditionally been inaccessible until the insured expires are readily available, with interest. Guaranteed asset protection via single premium life insurance just makes good common sense. Consumers should consult with insurance agents about taking out single premium coverage and the provisions for securing short- and long-term benefits.
Other vehicles for guaranteed asset protection include establishing living trusts, annuities, or formulating family-owned limited liability corporations, or LLCs. Family LLCs can be formed with one member acting as a general partner and others as limited partners, with limited liability. Essentially, the average American family can form a partnership similar to syndication, which allows individual members to share in profits, but protects share assets. Real and personal property becomes part of the corporation; and family members are only liable to the extent of their interest in the corporation. LLCs can purchase real estate, buy and sell stocks, or accumulate wealth that is protected under the U.S. Corporate law. In the event that an individual family member becomes the object of a lawsuit or legal judgment, assets placed within the limited liability corporation cannot be attached.
The best advice for individuals or families seeking guaranteed asset protection is to consult with a financial planner or an attorney that is well versed in corporate law, income tax, and investments. Professional money managers can help individuals that have held onto funds, in spite of a national financial crisis, find out how to make the most of short- and long-term investments and find vehicles for savings. With the right vehicle and a little patience, consumers should be able to ride out the storms of domestic financial woes to realize a brighter fiscal future.
Income Protection PolicyAn income protection policy can be a safe and reasonable short-term money solution, but a financial cover should not be considered a long-term answer to a person's money concerns. Therefore, the insurance is a form of stop-gap coverage. These types of insurance policies are not designed for an injured or disabled person to live on for years. In fact, there are measures built into most agreements to prevent people from living long term on benefits received from an income protection policy. According to an information website, income insurance is known by several different names, but they all essentially provide the same service. Other names include: permanent health insurance, income cover, income protection, income protection cover, sickness insurance, or just simply insurance protection.
Basically, the income protection policy provides funds to people who have lost the ability to earn wages due to illness, injury, or disability. On the surface, the policies sound like a good deal, but there are limitations to be aware of before buying. Basically, funds received from cover policies can be used however the insured chooses. The money can be used to pay bills and make mortgage or credit card payments. When buying an income protection policy, a person can buy as much coverage as he or she feels is needed. Not surprisingly, better coverage will cost more money. However, a person will not be able to profit from their injury or misfortune. A person will not be able to buy more coverage than they would make on the job. They will not even be able to make 100 percent of their projected wages. In fact, they will lose money, because benefits will probably be capped at about 60 percent of what a person would earn if they had continued to work. Insurance companies limit the benefits for a couple reasons. First, the funds are not taxed. Second, paying less than the person would earn from his or her job is an incentive to get the individual back to work once good health is restored. Otherwise, the rehabilitation period could be extended indefinitely.
Christians can reference at least three passages from the Bible to help understand how not working, if able, is a bad way to go. The first passage can be found in 2 Thessalonians. Basically, the passage says that if a person doesn't work, then the person doesn't eat. Not eating is major grief in any person's life. So connect that with the second passage, which is found in 1Timothy. That passage says money is the root of all kinds of evil and some people eager for money have wandered away from faith and burdened themselves with unnecessary grief. Finally, Luke addresses the dangers of serving two masters. "No servant can serve two masters: for either he will hate the one, and love the other; or else he will hold to the one, and despise the other. Ye cannot serve God and mammon. And the Pharisees also, who were covetous, heard all these things: and they derided him. And he said unto them, Ye are they which justify yourselves before men: but God knoweth your hearts: for that which is highly esteemed among men is abomination in the sight of God." (Luke 16: 13-15)
Some policies offer what are called partial or rehabilitation payments, when a person returns to work on a part-time basis. When considering the purchase of an income coverage policy read the fine print and know what is and is not covered before buying and signing for the coverage. Also, don't expect payments to start rolling in immediately. Most policies have a deferral period before payments begin. This period will vary from policy to policy but can be anywhere from four weeks to one year. And there are numerous exclusions with an income protection policy. Most coverage policies will not pay benefits pregnancy and childbirth. For the most part, pregnancy and related health issues are covered by other insurance. Government legislation has established rules and guidelines that regulate the income protection policy industry. The rules have been established to protect everybody involved. A search of government websites indicates that several companies that offer income cover policies have been fined in the past. In fact, the business continues to be a concern to government regulators. For more information research both government and private organizations that are familiar with cover policies.
No income protection policy will pay benefits for any self-inflicted injury. Also, any downtime stemming from alcohol or drug abuse is not covered. Pre-existing conditions are not included in most policies. If an insured person is still being paid by the employer or is hurt in a dangerous sport not specifically written into the agreement, benefits will not be paid in most cases. Retired, self-employed, and part-time workers are generally not eligible for cover insurance. Seek the advice of a financial counselor before purchasing a policy. There appears to be some debate as to the best place to purchase an income protection policy. Some people believe an agent who deals with the products of only one company is best. Others believe going to an agent who handles multiple companies and products is better. These agents are able to shop around and find the best available product and service. Many options are available for purchase, so buying the wrong product is a real possibility without knowledgeable assistance. Do as much research on different companies and products before contacting any company or agent.