At the end of 2021, the new 2022 Medicare premiums, Medicare Advantage plans, and Part D plans were announced. Many people were shocked that the Medicare Part B premium increased more than $20 per month. Those who were enrolled or looking to enroll in a Medicare Supplement Plan G in 2022 wondered what the cost of that plan would be. [Read more…]
There’s always talk about home-buying and mortgages, but with interest rates being at all-time lows over the past few years, I feel like the talk about those things have picked up. Not only that, interest rates are likely going up this year so people are trying to get in before it’s too late. In this post, I want to talk about mortgages, how they work, and what happens when applying for a mortgage.
A mortgage is a loan you get from the bank or another lender to buy a house. When you submit an offer to buy a house, you’ll apply for a mortgage, and it’s a very involved process. More on that later.
In a mortgage, you’ll have options for what your term is. Your typical options are 15-year, 20-year, and 30-year.
You’ll also have to make a down payment. Current trends show that a lower down payment is pretty common. Depending on the type of loan, you can put down 3+%. And how much you put down matters. If you put down less than 20%, you’ll have to pay Primary Mortgage Insurance (PMI).
Here are the pieces of your typical mortgage payment – principal, interest, taxes and insurance, and PMI (if applicable). Taxes and insurance are commonly put in an escrow account and paid when they’re due by the lender.
From application to closing, it’s about 45-60 days. During that period, you’ll go through underwriting. In underwriting, they’ll have you submit documentation to confirm your credit report, annual income, current assets and liabilities, employment information, prior tax returns, among other things.
After you’ve cleared underwriting and they’ve confirmed everything, you’ll head to closing. At closing, you’ll sign a lot of papers. You’ll likely need to bring your checkbook with you as well.
There are closing costs associated with your mortgage. Some of these can be added to your total mortgage and some of them need to be paid. Closing costs are normally 3%-6% of the total mortgage and can include real estate commissions, taxes, insurance premiums, title fees, and record filing fees.
And if you’re buying, you’ll also need to write a check for the down payment.
There is a slough of factors you need to meet when applying for a mortgage. Credit score matters. Usually, you’ll need at least a 620 credit score (all else being equal) to get a mortgage. Though the better the credit score, the better interest rate you’ll get.
The debt to income ratio needs to be under 50%. The lower the debt to income ratio (all else being equal) the more you can afford. If you have a 45% debt to income ratio and can afford a $250,000 mortgage, you’d probably be able to afford a $300,000 if your debt to income ratio is 25% (this is just an example, I didn’t do the math on this).
Condition of the home. With an FHA mortgage, they are a little pickier on the condition of your home. Usually, it’s just the outside of the home they’re picky with. Chipped paint is a typical thing they take issue with, so just be aware of that.
Applying for a mortgage is necessary for most people so it’s important you understand how they work.
Understanding 15-Year vs. 30-Year Mortgages in the USA
What to do when you’re one month behind on your mortgage
Why Financial Literacy is Important
**Securities offered through Securities America, Inc., Member FINRA/SIPC. Advisory services offered through Securities America Advisors, Inc. Securities America and its representatives do not provide tax or legal advice; therefore, it is important to coordinate with your tax or legal advisor regarding your specific situation. Please see the website for full disclosures: www.crgfinancialservices.com
The concept of insurance looks simple enough: It is an income replacement tool to make sure your beneficiaries can be protected financially after you pass away. This is one of the reasons why people buy insurance policies. [Read more…]
When you’re looking for term life insurance, the number of options that are available is often overwhelming. However, if you’re looking for a company that doesn’t require medical exams and can provide you with fast coverage, Bestow might be your perfect match. If you are wondering whether Bestow is the best option for you, here’s what you need to know about the company, as well as a look at the pros and cons of using Bestow.
Bestow is a term life insurance policy portal that uses a streamlined online application and algorithm-supported calculations to determine if a partner insurer can extend you coverage. It’s important to note that Bestow currently acts only as an agent or broker, so any coverage you get isn’t technically from Bestow. The company does have plans to become a fully licensed insurer, though it isn’t clear when that’ll occur.
At Bestow, speed and convenience are both priorities, something that may appeal to many prospective customers. However, as with all companies, there can be some drawbacks to going this route.
The main pros of using Bestow are speed and convenience. The application process only takes a few minutes and, since a medical exam is never a requirement, you can wrap everything up in no time. Plus, everything is online, so you can get it all done from the comfort of home.
Another benefit of Bestow is that your coverage – should you decide to purchase it – begins right away. There aren’t any waiting periods or setup delays, giving you immediate peace of mind.
Bestow doesn’t work on commission, so you don’t have to worry about being pressured into a plan that isn’t a good fit. Instead, you’ll get options that are selected for your situation, not the amount of money they generate for the company.
Finally, Bestow works with an A+ rated carrier. While there is a higher rating companies can get (A++), A+ is still incredibly reliable, which can make you feel more confident about moving forward with a longer policy if that’s what you’re after.
As with all term life insurance options, there are some drawbacks to using Bestow. One of the biggest is that coverage is only available up to $1.5 million. While that may sound like a lot, other places do offer policy options far above that mark.
Additionally, Bestow only supports term life insurance. If you’re looking for another kind of coverage, Bestow isn’t designed to meet your needs.
Even if you’re looking for term life, not everyone qualifies for coverage either. While there isn’t a medical exam, you do have to supply some details about your health history, and certain conditions make you ineligible for coverage.
Age restrictions do limit many people’s options, too. While the company does have term lengths as high as 30 years and can supply coverage to people up to 60 years old, that doesn’t mean everyone age 60 and younger has access to 30-year terms.
Instead, for a 30-year policy, you have to be a woman under the age of 41 or a man under the age of 40 and a non-tobacco user. For tobacco users, the age cutoffs are 31 and 30, respectively. The highest age for a 25-year policy is 45, and 20- and 15-year policies are cut off at 50 and 55, respectively. If you’re above the age of 55, a 10-year term is the most you can get.
When it comes to coverage amounts, Bestow isn’t necessarily the most expensive. However, there are more affordable options available.
Generally speaking, Bestow could be a solid place for term life insurance for many people, particularly younger adults who aren’t tobacco users. However, anyone age 60 and under looking for coverage who doesn’t want a cumbersome application process or medical exams should keep Bestow in mind, too.
In the end, getting a quote from Bestow is completely free. As a result, you can find out what coverage options are available to you specifically, all without having to commit. Then, if there’s a plan that meets your needs, you can finalize the purchase, allowing you to have immediate coverage.
If you’re looking for term life insurance and you need it fast, Bestow could be your answer. You can find affordable plans with ease and get instant coverage upon approval, all from the comfort of your home. Head on over to the Bestow website to learn more today.
Can you think of any other pros and cons of Bestow that people should know about? Have you used Bestow and want to discuss your experience? Share your thoughts in the comments below.
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Healthcare costs can add up quickly. However, if you’re using out-of-network medical services. The damage to your financial health could be significant. If you are wondering what kind of impacts out-of-network providers can have on your budget. Here’s what you need to know.
An out-of-network provider is a healthcare facility or medical professional that isn’t affiliated with your health insurance coverage. They aren’t part of your insurer’s medical care network.
Medical networks are groups of doctors, hospitals, and facilities that have a contract with your insurance provider. That contract outlines various details about care. Particularly when it comes to the rates they can charge insured patients.
It’s important to note that out-of-network medical professionals can work for in-network facilities. When that happens, any facility-related charges are bound by the contract. However, services provided by the medical professional are not.
When patients use out-of-network medical providers. They end up paying different rates for services than if they used an in-network provider. The out-of-network provider isn’t bound by a contract with your insurer. Thus, allowing them to set their own prices for services.
Insurers may also set separate coverage rates for using in-network and out-of-network doctors. For example, the percentage of the charge that the insurer will cover, copay amounts, and other details may be different. The rates are less favorable if you use out-of-network providers.
In some cases, insurers may not cover any of the costs associated with out-of-network care. When this happens, the patient is responsible for the full bill regardless of whether the insurer handles some of the expense if an in-network provider was used.
Cumulatively, this means that out-of-network medical services cost patients more money. Providers may charge higher prices, and the insurer may cover less of the cost. Anything not handled by your insurance company is your financial responsibility, so you’ll end up with a higher bill by not staying in-network.
Often, healthcare insurance and medical bills are quite costly, even when you use in-network providers. However, if you go out of network, the out-of-pocket costs are even higher. That can put a significant strain on your budget, making it hard to cover your living expenses while you repay the debt.
In the worst-case scenario, the higher costs might actually be unaffordable. If that happens, you may fall behind in repaying your medical bills, causing the account to go into delinquency or leading the provider to send the account to collections. At times, it may become so burdensome that bankruptcy seems like the best option, a choice that can have long-lasting effects on your credit report and score.
Can you think of other ways that out-of-network medical services impact your financial health? Share your thoughts in the comments below.
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Hurricane season is currently well underway. While most people don’t want to think about a hurricane hitting their home. If you live in certain areas of the country, the possibility certainly exists. That’s why having the right kind of insurance coverage is so critical. Without it, you may not have the proper level of protection if your house ends up in the path of a hurricane. If you are wondering what your homeowners insurance won’t cover for hurricanes. Here’s a breakdown based on insurance type.
While homeowners insurance can be fairly comprehensive, it does have limits. Certain types of damage are often excluded if you have a traditional homeowners insurance policy.
In many cases, hurricanes aren’t explicitly listed as non-covered events. However, the kinds of damage hurricanes often cause normally are listed as excluded.
For example, water damage caused by storm surges and floods isn’t covered by the vast majority of traditional policies. If you live in a hurricane-prone area, some forms of wind damage might also be excluded. In both of those cases, you may need supplemental policies for flood and wind damage to secure the proper coverage.
Additionally, sewer backups related to a hurricane aren’t usually covered events. In fact, you may have to have both flood insurance and sewer backup coverage to ensure you have all of the protection you need.
Finally, if you incur expenses during an evacuation, such as costs associated with temporary lodging, that isn’t covered by most traditional homeowners insurance policies. However, if you come back to find that your house is now unlivable. You may have some coverage that can offset any temporary housing costs.
It’s important to note that if you do have a policy that covers hurricane-related damage. You may be subject to a hurricane deductible. A hurricane deductible is similar to a typical one. Since it outlines the amount you are responsible for paying to address the resulting damage.
However, hurricane deductibles are higher than your typical deductible. Additionally, they only apply under specific circumstances. Usually, a triggering event has to occur. For example, if a hurricane warning is issued by the National Weather Service, that may enable insurers to require hurricane deductibles.
Whether you may be subject to a hurricane deductible depends on where you live. They are only a factor if you reside in one of the areas that allow them. Currently, those locations include:
Additionally, the amount of a hurricane deductible can vary. Typically, it’s based both on state law and the value of your covered property. It could be as little as 1 percent of your home’s value. On the other hand, it could be as high as 10 percent. This depends on applicable laws and what’s in your policy.
As mentioned above, certain kinds of hurricane-related damage aren’t usually covered by basic homeowners insurance policies. However, if you have the right supplemental policies or riders. You may have all of the coverage you need.
If you want reasonably comprehensive coverage for all kinds of damage a hurricane can cause. You may need the following extra policies:
Typically, by adding those three kinds of coverage, you can address most hurricane-related damage. However, as with all insurance policies. You’ll need to review the details to confirm what is and isn’t covered. Even those policies or riders can have exclusions. So you want to read through the policy carefully to make sure you have everything you need.
Renters have a different kind of insurance coverage than homeowners. With a renters insurance policy, there’s never any coverage for the building’s physical structure. That’s because the renter doesn’t own the building.
However, like homeowners insurance policies, renters insurance coverage does have limitations. In most cases, damage caused by floods created by hurricanes isn’t a part of a typical renters insurance policy. Instead, the renter would need a separate flood insurance policy or a rider that addresses that type of water-related damage.
If you have a basic renters policy. Adding flood insurance or an appropriate rider may be enough. However, you’ll want to review the policy details to confirm.
Additionally, it’s important to note that renters aren’t typically subject to hurricane deductibles. As a result, if you owe a deductible. It’s typically the standard one in the policy.
Both homeowners and renters insurance policies don’t extend coverage to your vehicle. Regardless of whether the damage is related to a hurricane. As a result, you need a separate auto policy.
Unlike homeowners and renters insurance, comprehensive vehicle policies do provide hurricane-related coverage. With comprehensive coverage, damage that isn’t related to a collision is covered. Which includes damage caused by severe weather.
However, if you only have liability coverage on your vehicle. Damage related to a hurricane isn’t a part of it. In that case, you would have to handle any related expenses yourself.
Can you think of anything your homeowners insurance won’t cover for hurricanes? Share your thoughts in the comments below.
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If you are starting a new business, it is important to sign up for an insurance policy as soon as you can. Especially if there is a strong chance that the business might fall into a financial catastrophe in the future, it is important to register for a suitable insurance plan as soon as you can. In simple words, insurance provides strong protection if any of the passersby or even the stakeholders try to cause any damage to your firm. So if you have decided to get an insurance policy for yourself, it is important to embrace the importance of insurance for your business as well. For example, if you have a food business and one of the customers falls sick after having a donut, they will sue you right away. This is when a commercial insurance policy will help your firm stay afloat.
Therefore, it is important to talk to the corporate insurance brokers and ensure that your firm has a strong policy. Keep in mind, in some contracts; you will have to purchase an insurance policy for yourself first. Especially if the business hasn’t provided the worker’s compensation benefits, the firm will have to settle for such a policy In the first place.
If any party is harmed by your business activities, the business liability insurance will take care of it. Although the customers are standing a greater chance of getting harmed by the core product, still the bystanders might get affected as well. For instance, if your company is using hazardous materials and they explode, it will eventually have a strong impact on everyone around. Therefore, a business should be prepared to tackle unforeseen circumstances all the time. On the other hand, the different types of business insurance are also the requirements of the state government.
Such policies actively protect the workers in case they get hurt. So if there is a strong chance that the workers will get affected due to unemployment insurance or on the job, the business insurance policy will make sure they are provided with the maximum financial compensation.
Simply put, you can look for the best policies online. Instead of asking people around who have little to no experience, it is recommended that you sift through the customer reviews on the web and look for a suitable business insurance plan. You can also inquire about the people from the same industry and see how commercial business insurance has worked out. Secondly, when sifting through the rates, you will be astonished to witness the differences because the rates will always vary. You can consult a broker who has experience working in your industry. Such people can easily help you get the best business insurance policy out there. They will work on your budget and make the best recommendations. Therefore, you shouldn’t overlook hiring such a person for this job.
No homeowner imagines being the victim of a natural disaster. A serious flood can be devastating. Floods can damage your home and personal property with surprising speed. However, not having flood insurance can make the entire situation worse. Without the right coverage, your losses may not be covered. If you’re wondering why every homeowner should have flood insurance. Here’s what you need to know.
Flood insurance is a type of coverage that is separate from a traditional homeowners insurance policy. Anyone who lives in an area with flood risk can potentially purchase this supplemental policy.
It specifically focuses on flood-related damage caused by natural disasters, as well as other causes. Usually, flood insurance covers damage in specific categories.
First, flood insurance will commonly handle structural damage to your home. This includes the actual building, as well as some related systems, like electrical, plumbing, and HVAC.
Second, flood insurance may cover your personal property. This includes damaged furniture that isn’t salvageable and similar household items, as well as clothing. However, this isn’t always part of the starting flood insurance policy, so you may need to request it be added if you want this protection.
Now, certain high-value items may not be fully covered by base flood insurance. This can include art, antiques, jewelry, firearms, or electronics above a certain value. In those cases, you may need flood insurance riders to add that coverage, just as you do with traditional homeowners policies.
Additionally, it’s important to note that every policy is different. Before you make assumptions about your coverage, review your flood insurance policy carefully. Ask questions about what is and isn’t protected, and request add-ons if needed to provide you with the level of protection you’re after.
Typically, flood insurance fills a gap that many homeowners have in the primary policy. While homeowners insurance does cover some types of water damage under the hazard insurance segment of their policy, flooding events usually aren’t classified as the covered kind of hazard. As a result, damage caused by a flood may not be covered, leaving you without financial support to repair your home or replace your personal property.
Essentially, if you don’t have flood insurance, you’ll have to handle all related costs out of pocket. For most homeowners, this simply isn’t feasible. Flood repairs to a structure can be incredibly costly. Similarly, replacing all of your damaged personal belongings could take thousands and thousands of dollars.
It’s also important to note that homeowners with mortgages who live in higher-risk areas may be required by their lender to have flood insurance. This is especially true for anyone who uses government-backed financing sources, as there are federal laws requiring the coverage for properties they finance in high-risk zones. However, other lenders often follow suit, even if there isn’t a legal requirement.
The mandate for flood insurance is similar to them requiring homeowners insurance in general. It ensures the property is protected should a flood event occur and, since the lender is technically the owner until you pay off the mortgage, they have a vested interest in protecting its value.
If you want to see if a property is in a high-risk flood area, the simplest way is to use the Federal Emergency Management Agency (FEMA) Flood Map Service Center. Simply enter your address into the search bar, and the site will display a map that identifies your home’s risk level.
You may be able to turn to other state and local resources as well. State emergency management agencies may have flood maps, for example, so they can be worth checking if you find the FEMA results lacking.
No, homeowners in low-risk areas shouldn’t skip flood insurance. Even if you live in a low-risk area, going without flood insurance means you aren’t protected should the unexpected occur.
Low-risk doesn’t mean risk-free. Many natural events are unprecedented. But even if they weren’t deemed likely, your base homeowners policy won’t cover the related damage if it is excluded in your policy.
Additionally, risk levels can change over time. An area that wasn’t previously flood-prone can suddenly become so for a variety of reasons. Climate change, land development, and similar shifts can alter water flow through regions, turning areas that previously didn’t experience flooding into moderate or high-risk areas.
If you need flood insurance, you can call your homeowners insurance company to see if they offer it. Some insurers have flood insurance riders, while others may require a separate policy for that specific kind of coverage.
However, not all insurance companies offer flood insurance. If that’s the case, you may not be able to secure flood insurance through your homeowners policy provider. Instead, you’ll turn to the National Flood Insurance Program, a system run by FEMA, that can help you find a provider that covers homeowners in your area.
Do you think every homeowner should have flood insurance? Have you decided to risk it and go without flood insurance? Has flood insurance ever saved you from financial hardship? Share your thoughts in the comments below.
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Life insurance can offer a solid jumpstart towards the future security of your dependents. It may be an intimidating topic; however, it must be considered by every household, particularly by the family’s primary provider. [Read more…]
Getting car insurance can be a big responsibility, especially if you have never had it before. However, there are many reasons you should get one. This article will give you the information that you need to decide whether or not you should get car insurance, and what kind of policy you should get. [Read more…]
