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Kristina Said:

What are benefits of 'investment' life insurance vs. other tax reducing investment vehicles?

We Answered:

You are smart about being cautious toward your friend who is trying to sell you the idea of life insurance being an "investment." Life insurance is not an investment. Its insurance that provides your family income in case you die. There's two types of life insurance. One builds cash value (otherwise known as whole life, universal life, variable universal life, etc) and the other type doesn't (which is term insurance). All financial experts agrees that term insurance is the best way to protect your family against financial loss. I personally own a 30 year term insurance and all my clients own term insurance as well. Why? Its inexpensive, so you can get lots of coverage for low cost. Since its inexpensive, it gives you more flexibility to save your money elsewhere.

You say that someone is looking for a long term investment where is tax-reducing. There are many examples that fits this objective such as qualified retirement plans (such as a 401(k) or 403(b)) and IRAs. These types of plans grow tax-deferred. So you get more of your money invested in the market over the long run. I have a Roth IRA and I invest every month into mutual funds. All my clients do the same.

While having life insurance and investments is a good plan, its only a partial picture of a full complete financial plan. A full complete plan includes protecting your income (which is life insurance), having an emergency fund (in case you can't work for a period of time), having a debt elimination plan, a retirement plan, and any other plans (such as education plans for your kids or planning for a wedding or a house). I do all these things for my client. Hopefully you will find someone who does a complete financial needs analysis for you.

Lillie Said:

Here I am 47 years old. 7 years to pay off the mortgage $170.000 home. Paid for 22 ft Wellcraft boat in cash,?

We Answered:

I've been in your shoes my Friend. Rags to riches and, back
again. Poor health, family disowned me etc. My advice is:
Get down on your knees and, pray to Jesus for guidance,
endurance, patience, faith in him and, believe that what ever
you ask in HIS name, HE WILL DO IT! He will restore all, you
must seek his will first and, have FAITH! Read your bible.
If you are homeless, most counties have programs that can and will help you but, YOU have to do your part! Don't be proud. Also, Church's have food programs etc. My prayers are with you in Jesus name.

Willie Said:

TFSA contribution vs. paying down mortgage?

We Answered:

Open up a discount brokerage account like Charles Schwab or Fidelity.
Put 6 months salary in there and buy some cd's or bonds for now.
This will give you comfort in case an emergency comes up, or unemployment.
Then pay off your cars. No more car leasing. Every calculator I see says its cheaper over the long run to buy.
Then, and only then, you can pay down your mortgage. Make an extra check and write in the memo "towards principal"
At the same time, if you have extra cash, open up an IRA and take the $5,000 yearly deduction.
The brokerage account with your 6 months salary will come in handy when you have kids heading for college. Keep putting money into it.

Ramona Said:

What is the best order to invest money? Roth vs. 401K vs. Life Insurance?

We Answered:

Best order to invest money?

1) Max out your Roth IRA contributions. I would divide the maximum limit over a 12 month period. For example, invest $333.33/month vs putting $4000 once a year.

2) Max out your 401(k) contribution.

3) If your wife isn't working, you can max out her IRA contribution on her behalf.

4) Setup an emergency fund (use money market fund as an emergency fund). There should be enough in there to last you 3-6 months in case there is an emergency (such as losing your job).

5) If you still have money left over, check out Metlife's PrimeElite IV variable annuity.

As you can see here, I did not list life insurance. Life insurance is never an investment. It is insurance that pays a death claim in the event that you die. I would stay away from any life insurance policies that builds cash value. Cash value is the biggest scheme and if you are uneducated about it, you would fall into the deception that the cash value belongs to you.

Virgil Said:

Career in Mortgage loans vs Insurance?

We Answered:

The mortage biz is geting tougher. Not a lot of money in P&C though, life and health is where is make the big commissions. P&C is something you build a career with. Small now but after several years, it will be good.