Which Is First: Paying Off Your Debt or Investing for Retirement?

This question has plagued financial planners for years. Should you pay off debt, or should they start a retirement account first? This assumes that the same amount of money is involved in each transaction. We will use $5,000 for our examples. Below we will take a look at the pros and cons of each option, and give our opinion. Paying Off Debt First Paying off debt is a great way to use a lump sum of money. Being in debt can be burdensome to the individual in debt, and feeling like you are never going to get out can be awful. If you do not have a lump sum, you may want to consider a debt management plan to help … Read more

Reader’s Question: Do Single People Need Life Insurance?

Essential Money Tips for New Parents to Implement on Day 1
Do Single People Need Life Insurance?

Understanding the purpose of life insuranceHere is the next installment in our the Reader’s Questions Series which highlight questions emailed to me by you, the readers of Money Q&A. Be sure to find out at the end of this article how you can receive a free copy of Dave Ramsey’s book, The Total Money Makeover if your money question is chosen to be featured a future week’s blog post.

If you’re not familiar with Dave Ramsey’s book, you should run right out and get it. It is one of the best personal finance books that everyone should read. Now….on to our reader’s question.This week’s Reader Question is from Michelle in Fargo, ND. She asks…

Do single people need life insurance?

This is a great question that I hear quite regularly actually, and it all stems from people not understand the true purpose of life insurance.

Do single people need life insurance if they do not have an heir or someone that they look after or who relies on their income?

The True Purpose Of Life Insurance

Life insurance is meant to protect your most valuable asset, your income stream. More importantly, it is designed to protect your future income stream should you die a premature death. Life insurance protects your income and replaces it for your loved ones who depend on it in order to survive and live day to day.

So, if you have no one who depends on your income to live such as a spouse or children, then you most likely do not need life insurance. This is a prime example of why children do not need their own life insurance policies.

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Money Q&A Interview On KGO 810AM San Francisco

I was recently interviewed on KGO 810AM San Francisco. This was my first interview talking about money matters and consumer savings tips. I was interviewed about the article that I wrote detailing how to save money on my moving expenses. Ten Ways To Cut Costs On Moving Expenses Moving from one home to another or into your next apartment is expensive. But, there are many moving tips that can help you save money on moving expenses. I have come to find this out the hard way. For years, I have been blessed with an employer that covered all of my moving costs, but this time it is different. This time I am footing the bill by myself. You may remember … Read more

Dangerous Dog Breeds And Your Insurance

Rottweiler is a dangerous dog breedIf you have applied for a homeowner’s insurance policy in the last ten years, you may have been surprised when the insurance agent asked you if you have any pets. Specifically, they are looking to see if you have any dog breeds that the insurance company deems to be dangerous. In fact, many insurance companies limit coverage to dog owners, and may deny coverage all together to owners with certain breeds.

Why Insurers Hate Dangerous Dog Breeds

While many consider insurance companies refusing to insure individuals with certain breeds, the fact is that insurance companies have been on the hook for too many lawsuits resulting in damages from these certain breeds. When you get a homeowner’s insurance policy, you also get a personal liability policy that covers the homeowner for a certain amount.  If the homeowner’s dog were to bite someone and cause damage, the victim could sue and the homeowner and their insurance policy would be liable for the damages.  As a result, insurance companies are carefully looking at which breeds pose the most risk, and limiting the insurance provided to homeowners with those breeds.

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Filing Too Many Small Claims Can Hurt You

You purchase home insurance to protect yourself if something major goes wrong such as a pipe that bursts, there is a fire, or some other peril.  In fact, most mortgage companies require you to have homeowner’s insurance if you have a mortgage on your house to protect their stake in your home as well. However, insurance companies are not in business to pay out too many claims. They would quickly find themselves out of business if they did that, and they take a negative view on customers filing too many claims in a short period of time as well. This is considered a red flag, and you can quickly find your insurance premiums going up or worse. What Is Considered … Read more