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  • Anton Luyten
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  • Last Posted: 2017-06-28 08:35:07
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Love-Hate Relationship with Finance

2015-07-24 04:00:48

Most of us have love-hate relationship with finance, our “significant other”, primarily because of the computations involved. But in reality, we cannot deny its impact in the long run, especially in our daily life. Numbers are everywhere. So, we have no choice but to face it, anyway.


Here are some tips to improve our connection with finance.


Jackie Real-Sales of The Law Offices of Jacqueline Real-Salas says several people have no idea on how to live in the way they have become accustomed. The first thing a person should do is to check the Social Security’s website where he or she can calculate the benefits. A lot of options are available to optimize those benefits, but one has to take into account his or her other sources of income to do so. An average pension is at $2,663 a month, not enough to sustain the standard of living during golden years. If that is the case and the funds are insufficient, they may need to defer retirement for a few years, scale back projections to increase savings, or find other source(s) of income.


Never underestimate life insurance. A permanent life insurance can serve as a savings tool. A percentage of the premium is placed into an investment account, generating returns through money markets or mutual funds. One can either borrow against it for important purchases such as education or a new house, or let it grow with earnings tax-deferred, presuming it will withdrawn during retirement. This can be used to establish a legacy for a surviving spouse and/or other immediate family members to leave an inheritance for loved ones.


It is also an imperative to have a long-term health insurance, as these policies can help shoulder medical expenses, assisted living, or other related costs. The absence of a health insurance can dent savings and investments. However, healthcare policies set the limit the insurance firm will pay on such expenses.


Do not forget estate planning. which helps avoid spending thousands in unnecessary legal costs, court fees, and other charges that arise due to poor planning.


How about a reverse mortgage? Although it is not for everyone, this mortgage can be a great tool to help support retirement. It enables a person to retain the standard of living he is used to. The loan may be disbursed in equal monthly payments or in a lump sum for a certain time period. Lines of credits are available, but monthly payments are unnecessary. In general, such mortgages are repaid by selling the property when the borrower leaves the property or dies. The owner’s heirs can inherit whatever equity is left in the house.


Finance is complicated in nature. But through self-study, researching, and seeking the advice of a professional, you can secure a long-lasting partnership with finance.