Guide to
Real Estate, Banking & Finance
A Blank Slate Media / Litmor Publications Special Section • January 12, 2018
32 REAL ESTATE, BANKING & PERSONAL FINANCE • Blank Slate Media Newspapers, Friday, January 12, 2018
Today’s long-term care landscape BY N ATA L I E K A R P AND RONA LOSHAK If you’ve been straddling the planning conversation; thinking about whether long term care insurance is appropriate for you, is aordable, or if “self insuring â€? (still) makes sense , there has never been a better time to have a conversation and revisit :
The choices are fundamentally between “stand alone; traditional policies� or asset based solutions that combine a life insurance platform with long term care.
The Biggest Bang for your Buck, Stand Alone LTC If you live in New York State, are a business owner, or itemize medical expenses, you have meaningful deducThe Why, What and How: tions and credits from the federal and Long Term Care Insurance today: state government. If you prefer a low annual premium, stand-alone Long Term Care plans Why? pack a punch. Lots of options in the • We are living longer lives! way of riders that include shared care • Government programs are limited plans for spouses, innovative ination and unreliable • Mitigating risk and longevity planning protection and waivers for elimination periods. is statistically and economically Having just come back from a consound. ference laden with actuaries, (that’s a • Blended families and second party waiting to happen) the news has marriages for couples and adult never been better. children Stand-alone polices written af• Protecting your health, your money, ter 2010 have less than a 10 percent your lifestyle and your family’s well chance of a rate increase! being. Today’s generation of policies are priced appropriately, and reect the What? Today’s long-term care solutions reality of claims experience, women’s give you exibility and a choice in priori- rates (unisex rates has now given way tizing what is most important. You can to gender speciďŹ c pricing), longevity prioritize according to budget, leverage, and today’s low interest rates. Legacy policies are “old newsâ€?. exibility, and tax eďŹƒciency.
Life Insurance and LTC. Asset Based Solutions and Linked BeneďŹ ts. Where the puck is moving. Life and LTC hybrids are the new darlings that oer guarantees, limited pay options and death beneďŹ t. You have an “either-or “ scenario with LTC beneďŹ ts for care or a death beneďŹ t as well as a return of premium if you “want out.â€? Highly leveraged money for long-term care makes this compelling especially for the “ I can self-insure “ crowd, who can reposition underperforming or dormant assets. Using life insurance as a foundation and adding a LTC rider (whole life or second to die policies) can be structured to include lifetime beneďŹ ts and cash value (state speciďŹ c). Plans can be tailored for use in ILITs, as executive carve outs and or employee beneďŹ ts. How? Tax incentives and ďŹ nancing ease- even for those who do not want to write a check. The state and federal government want you to take action! And provide incentives for consumers and business owners. If you pay taxes in NY State, there is a 20% credit on your annual long-term care insurance premium(s). Federal deductions are in still in place
with an
C E L E B R A T E
for those (and their spouses) who own their own businesses. Consumers with tax hostile money in annuities can reposition their $$ tax free into LTC Insurance. Dormant and underperforming assets can be better leveraged. Cash in an annuity? Or a life insurance contract? You are able to use the cash and reposition tax hostile money to tax free money through a 1035 exchange. Incentives to make ďŹ nancing your LTC planning painless also extend to Health Savings Accounts, which provide another resource that make paying premiums easier. Tax QualiďŹ ed Accounts – Depending on the state, you can fund your long-term care policy tax eďŹƒciently. State and age speciďŹ c. The landscape of long term care insurance continues to change. Navigating the maze of options has never been more challenging yet easier to ďŹ nance. Reframing the conversation of long term care to why, means protecting your family. The how has never been easier. Information provided Natalie Karp and Rona Loshak, Founding Partners, Karp Loshak Long Term Care Insurance, www.karploshak.com; 516-801-1419
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News Times Newspapers, Friday, January 12, 2018 • REAL ESTATE, BANKING & PERSONAL FINANCE
33
Online banking safety tips
.75 % APY Liquid Savings Account
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n the digital era, many errands that once required leaving the house can be conducted from the comforts of home. Groceries can be ordered online and delivered to consumers’ doorsteps, while bills can be paid online, saving men and women from having to drive to their nearby post office. Online banking has revolutionized the way people manage their money. Investors can buy or sell stocks with the click of a mouse, and money can be moved across accounts just as easily and instantly. Many consumers now even do their banking on their mobile phones. In fact, a 2016 study from the Federal Reserve found that 67 percent of millennials use mobile banking, suggesting that mobile banking is the wave of the future. While online or mobile banking makes it easy for consumers to manage their money, it’s also potentially much riskier than in-person banking at the bank. Unseen hackers and thieves are lurking online and in places where Wi-Fi is open and free, so online and mobile banking enthusiasts must exercise caution when accessing their accounts. Sign up for two-factor authentication. Some banks and credit card companies now provide two-factor authentication, and some may even insist their customers use it. Two-factor authentication requires two forms of verification before users can log into their accounts. The first might be the traditional username and password, while the second might be a temporary code texted or emailed to users after they log into their accounts. Some consumers may feel two-factor authentication is tedious and slow, but it’s an effective safety measure that should only delay online or mobile banking by a few seconds.
Use only secure network connections. Public Wi-Fi can be convenient, but consumers should never use such connections to do their online or mobile banking. The American Bankers Association suggests consumers always do their online banking via their own private home networks. Consumers who routinely use public Wi-Fi, even if it’s just for basic internet surfing, should log out of mobile banking apps or websites before logging on to public networks. Change passwords frequently and avoid using the same password for more than one account. Many banking websites advise customers if their passwords are weak or strong when customers first set up their accounts. Even if customers’ passwords are deemed strong, it’s best to change them periodically so hackers or criminals cannot guess them. And consumers should never use the same password for more than one account, as that can make it much easier for criminals to steal consumers’ identities. Monitor credit scores. Consumers have the right to one free credit report each year, but many credit card companies now update customers regarding their credit scores once per month. Consumers many need to sign up to take advantage of this service, but doing so is typically free. If credit scores suddenly dip unexpectedly and without reason, consumers may have been victimized by identity theft and can then take the necessary course of action to address the issue. Online and mobile banking is convenient, but consumers must tread carefully when accessing sensitive financial information online.
Free Checking, Online Services + more. Same rate applies to our Youth Accounts. Ask about our additional Savings options.
VISA Credit Card: 8.9 to 17.9 %
between
ASK about our other Loan options: 2 Year Adjustable Rate Mortgage, Line of Credit, Car Loans, etc. We are your Community Credit Union. Reach for the sky because the winds of change are with you.
34 REAL ESTATE, BANKING & PERSONAL FINANCE • Blank Slate Media Newspapers, Friday, January 12, 2018
8 ways to start saving now S
aving money is difficult for many people across North America. According to a 2017 GoBankingRates survey, 57 percent of Americans have less than $1,000 in their savings accounts, and 39 percent have no savings at all. A recent Ipsos survey on behalf of the accounting firm MNP found that more than half of Canadians are living within $200 per month of not being able to pay all of their bills or meet their debt obligations. With such little room for error, even minor unexpected bills can pave the way to financial hardship. Fortunately, many people do not have to make drastic changes to save more. Here are several ways to start saving more now. 1. Plan meals. Decide what you will make in advance and list all the ingredients, enabling you to shop for the lowest prices. 2. Cut the cord. Cutting ties with traditional cable television providers can save consumers
substantial amounts of money. Streaming services like Netflix, Hulu, and Amazon Prime provide a slew of content for a fraction of the cost of mainstream cable. 3. Establish a goal. It’s easier to save when you have an end goal, whether it’s financing a vacation, buying a home or growing your family. Establishing a goal gives men and women something to strive for. 4. Make coffee at home. Make your daily coffee at home rather than paying several dollars per day for that morning cup of Joe. 5. Wait before checking out. Impulse buys can quickly add up. Store that online item in the shopping cart for a day or two to really think about if it is a necessity or just an impulse buy.
6. Shop quality not quantity. Bulk buys may seem advantageous, but not if the items break or wear out prematurely. When shopping, opt for quality merchandise that may cost more initially, but thanks to its durability, will save money in the long run. 7. Don’t worry about your neighbor. Trying to keep up with the Joneses, Smiths or Murphys is a recipe for
overspending. Stick to your budget and make improvements or upgrades as you can afford them. 8. Rely on automatic deductions. Set up automatic deductions so a predetermined amount of money is deposited into a designated savings account each paycheck. Chances are you won’t miss it, and the savings will add up.
they have enough capital left after making their down payments to address any repairs that need to be made. If not, they might have trouble attracting renters willing to pay enough in rent.
Financial reserves Some lenders may require that prospective investors have sizable financial reserves before they will lend them money to invest in real estate. Some may require that borrowers have several months’ worth of reserves to finance both their personal lives and their investments. If a 20 percent down payment would make that impossible, then prospective investors may want to wait a little longer to invest and save more money until their financial reserves would prove more acceptable to lenders. Investing in real estate can yield big returns. But first-time investors should know that such investments are vastly different than investing in a home for oneself.
Tips for first-time real estate investors R
eal estate can be a good investment that helps build wealth and secure a financial future. According to Investopedia, average 20-year returns in commercial real estate hover around 9.5 percent, while residential and diversified real estate average returns of 10.6 percent. Such figures may seem too good to ignore for many prospective real estate investors. But investing in real estate can be risky, and it’s important that first-time investors consider a host of factors before deciding to delve into the real estate market. Current finances Real estate can potentially yield big returns, but these may only materialize after investors spend ample amounts of money refurbishing or even maintaining their investment properties.
Prospective investors without the capital on hand to finance repairs or routine maintenance may find it difficult to make their properties appealing to potential tenants, which can make it harder to meet mortgage payments. Prospective investors who already have sizable debts, be it consumer debt or existing mortgage payments, may want to pay down those debts before investing in real estate. Down payments According to Wells Fargo, mortgage insurance does not cover investment property, and loans typically require a minimum down payment of 20 percent of the value of the property. So prospective investors cannot count on mortgage insurance to finance their investments in real estate. Investors should not just make sure they can meet that 20 percent requirement, but also ensure
Interest rates Prospective real estate investors may be surprised to learn that investment property loans are often subject to higher interest rates than those for home buyers borrowing to purchase a primary residence, says Quicken Loans. Investors should not count on getting the same or better interest rates for their investment properties that they did when buying the homes they currently live in.