ARCHIVE FILES MARCH 2010 Whose responsibility is it? Let’s explore what the Bible says in relation to financial responsibility and what Jesus had to say about family security. In this first article of three, I want to address the major points surrounding a man’s responsibility to his family and his family’s future. Let’s see what the Bible says about preparing for your future and taking care of your family. Prov 6:6 tells us to go to the ant and be wise. What does the ant do? He works all summer to store up enough food for himself and his family to ensure sustenance through the winter. If the wisest and one of the wealthiest men in the Bible (Solomon) followed and advised us of this principle, I think we as Christians should take his words of wisdom and begin to do the same in our families. These days perhaps we cannot actually store enough grain and food per se, but we can prepare for times of uncertainty. Next month we will drill down and look into how to do this practically. Does the Bible teach anything about your responsibility to your family after your death? Let us take a close look as Jesus is dying on the cross for the sins of the whole world. These are no doubt the greatest moments in the history of the world up until this point. The King of the Universe is about to die. Through dry parched lips Jesus utters only 8 different sayings while hanging on the cross. I want to specifically look at John 19:27, “Then sayeth He (Jesus) to the disciple (John), Behold thy mother! And from that hour that disciple (John) took her (Mary) unto his own home.” We know that John was the half-brother of Jesus and that Jesus was speaking of his mother, Mary. Why did Jesus make mention of this? Could it have been that Joseph had unfortunately suffered a premature death leaving his children to care for his wife? We know Jesus was around 33 years old at the time of his death, and nowhere in the Bible do you see reference to his earthly father, Joseph, around the time of his death. Perhaps Joseph had died, which would mean he could have been as young as  50 years old at the time. This could be the reason that his children then had to take care of their mother to the point of even giving her space in their home to live in, as evidenced in John 19. 1st Timothy 5:8, “But if any provide not for his own, especially for those of his own house, he hath denied the faith, and is worse than an infidel.” If this verse is true while the head of the household is living, why would death suddenly relieve you of the responsibility to provide security for your household? It does not, and next month we will take a very practical and Biblical approach to ensuring the future of our families and preparing for a bright and worry free future. You might ask, “Where in the Bible are you going to find reference to saving or investing the money God has blessed a Christian with?” Lets first look at Matthew 25:15-29. For sake of space I will recap the parable. A certain King gave 3 different servants a differing amount of talents or money to be in charge of in his absence. The first servant traded his 5 talents and doubled the original amount the king had allotted. The second servant was given two talents and the Bible says “…He also gained another two (talents).” We know the third servant was giving charge of one talent and he went and hid that talent and foolishly left it. The returning King was very pleased with the first two faithful servants who had been wise stewards of the possessions that the King had given to them. The third servant was slothful with what the King had given to his charge and his excuses were rejected. It is obvious from this passage that the King did not give to each servant the same amount of possessions to control, but the object and expectations were the same on them all. God has not called us all to be rich and to chase a dollar bill, but he demands that we be good and faithful stewards of that which he has given to us. I could go on and on with verses of caution as to the folly and vanity of riches, but I want to focus on the positive side of how to be a good steward and a wise servant with what God has blessed each of us with. In our May article we will come back to this parable and expound upon the Biblical truths in it as well as the remainder of the Bible. We will then bring this subject full circle and balance it out with practical advice to hopefully teach and help you understand the seriousness and responsibility God has given to us in these areas. Over the next 2 months I want to show you specifically how to practically plan for your families future. It has been said that if you fail to plan for the future, you are planning to fail. I am excited for the opportunity to write the next two months articles for Dr Kidd.com. Dr Kidd whole heartedly believes in the business I do, or he would not have asked me to write these articles. I believe this is one area of the Bible that has been neglected and ignored for way to long. The super-spiritual term “...just trust God…” is true to an extent, but God’s word teaches individual responsibility and stewardship. Don’t believe me? Come back next month and find out for yourself. Your family will thank you! Until next month, Phillip Kidd A.C.T. Insurance & Investments www.acti-i.com phillip@acti-i.com April 2010 Whose responsibility is it? This month’s subject is a continuation from last month’s discussion concerning the adult’s responsibility for providing security for their family. Last month we looked primarily at the biblical aspect of providing and protecting. This month I want to explore the more practical, realistic, and simple side of family security and protection. This article is aimed at the young and old alike, and it is wished that each and every person will take a little something from this article, and proactively act towards securing the necessary protections needed for your situation in life. I traveled the roads with my dad, Dr Phil Kidd, for the first 19 years of my life, and space will not permit me to recount the absolutely hundreds of scenarios that played out like this: You have a couple in their 30’s, 2 kids, and doing all the right things. Husband dies in a car accident, and then the decline begins. They thought that they had all the time in the world to plan for the future or a tragedy, but now it’s too late. The wife is now in debt for the house, the cars, the kid’s school, her husband’s funeral, the electric company, etc. In desperation the wife either runs out and marries the first guy that comes along with a decent job or retreats with ruined credit and embarrassment back to her mom and dad’s house to try and pick up the pieces. This whole scenario should never happen. Both Young and old families alike need to take responsibility for the “what if’s” in life. Pastor’s, Missionaries,  Evangelist’s, Deacons, and church lay people, listen to me,  please do not fall into the trap of thinking that church people or family will take care of everything when you are gone. God gave you responsibilities, and one of them is to take care and provide for your own families. Do not, and let me repeat, Do Not rely on a church, your family, an organization, or missions board to take care of your family after you die. Secure your own plan of protection and sustenance for your family, and here are some ways to do just that. Life Insurance: I know, nobody wants to talk about dying, but we all know the only two absolutes in life are taxes and death, so get prepared early. 46 million people out of Americas 303 million are totally uninsured. 25 million more people admit to being underinsured. Do you fall into either of these categories? If so you need to keep reading, and then do something about your situation today. There are basically 2 types of life insurance. 1. Term: it is the cheapest form of life insurance, and the best way to explain it is to liken term insurance to a presidential term. It covers a specific period of time such as 10, 20 or 30 years. If you are looking to secure term insurance make sure you choose a contract that provides a level premium over the WHOLE term period, a full conversion to permanent insurance without proof of insurability privilege, accelerated benefit provision that pays out a percentage of the death benefit if you are diagnosed with a terminal illness, and an A.M. Best “A” rated company. BEWARE of “Mortgage Insurance!” (it’s a possible rip-off) Contact me for the reason why and for more tips on choosing the term contract that is right for you. 2. Permanent: this is the nearly exact opposite of term insurance. As the name implies, it is permanent, and can be basically “whole life” or “Universal Life” contracts. There are other variations, but we will stick with the basic meanings of each. Whole Life is the most stable and unchanging form of life insurance and it boasts a guaranteed level premium until age 100 or more. All whole life contracts build cash value inside the policy, which you can be borrowed against. (Be careful here as some contracts have 8% or more interest on repayment of the loans.) There are nice variations to whole life policies, such as, single-premium, and 20-pay. These refer to the type of whole life policies available. This is the type of permanent insurance you need to secure if you do not like change. Universal life contracts, on the other hand, are much more flexible and shapeable policies. Universal life contracts are interest sensitive policies, and I like to refer to them as “bucket” contracts. Here’s why – think of a bucket, and every month your premium payment and interest earned on the cash value(water) inside the bucket gets poured into the bucket and at the end of the month there is a spout at the bottom that gets opened and the actual cost of insurance is taken out. The upsides of universal life policies are, flexible premium payments, flexible death benefits while the policy is in force, great for estate planning, high interest returns on policy cash value, and cheaper than whole life. Now you know the basic types and characteristics of life insurance contracts. Typically, life insurance can be used for a myriad of reasons, such as, Inheritance, to cover estate taxes, charitable gifts, final expense planning, bill pay, buy-sell agreements, mortgage protection, asset protection, peace of mind, and many more. Remember, death benefits from life insurance are typically TAX FREE! There is so much more that I do not have time to expound upon.  I am available to anyone who would like to discuss your current situation or policies in a more in-depth way, or to anyone who would like information on the other forms and variations of the life insurance contracts. Health Insurance: In 2008, nearly 60% of all bankruptcies/foreclosures were due to medical expenses and/or bills. Health Insurance, by far and large, is the most complicated form of insurance you will find. I recommend you contact me or another licensed professional to fully discuss health insurance for you, your family, or your business. A few notes to our readers – Be sure that you do not buy health insurance without FULLY understanding the benefit package that you are purchasing. (Such as deductible, Out-of-pocket limits, network, coverage for prescriptions, ER coverage, and any and all exclusions) Variations of traditional health insurance policies are H.S.A. compatible policies (terrific for those that need additional tax write-offs), Limited-Benefit contracts, and Health Access policies. KNOW BEFORE YOU BUY!!! Medicare Supplements: All Medicare Supplements ARE NOT created equal!!!  Medicare Supplements, depending on the coverage plan that you have, help offset the out-of-pocket costs that Medicare does not pay. The plan designs are controlled and set by Medicare itself. Here are some tips to take into consideration when choosing a Medicare Supplement policy – Make sure the plan gives a marriage discount if you are married, buy yours from a reputable long lasting A-rated company, and in my opinion, go with plan “F” “G” or “J”, since they cover so much more than all of the other plans at only a fraction more cost to you. Contact me for more information on choosing a Medicare Supplement policy that is right for you. Critical Illness: Right now I want you to name 2 people your age or younger than you that you know that have had cancer or a heart attack. How long did it take you? If you are like me, not long at all. Just think, in the next 20 years are you more likely to die or be diagnosed with a critical illness? Life insurance premiums are 50% lower today than they were 20 years ago, and the reason is simple – people are living longer due to advances in medicine. Today people survive cancer, heart attacks, etc., whereas 20 years ago these were a death sentence. Although relatively a new concept to the insurance landscape, Critical Illness insurance was first created by Dr. Bernard (the same doctor that performed the world’s first successful heart transplant), who, had grown tired of seeing his patients survive cancer, stroke, heart attacks, etc., and live in financial ruin and stress after winning their battle with a critical illness. These policies are basically designed to pay a lump sum of money (normally tax free) in the event of a critical illness. There are a lot of “cancer policies” and “specified disease” policies floating around, and here are a few tips in choosing what is best for you and your family. Select coverage that is all-inclusive meaning that it covers more than just one critical illness condition. The better policies should cover at least 12 major critical illnesses, and there is even a policy that provides occupational HIV benefits (for those working in medical, law enforcement, etc ). These type policies usually cost no more than a cup of coffee a day. Contact me for a listing of the best policies available that I can find. (FYI, during the time it took you to read this article 4 people in America have had an heart attack) Accidental Death & Dismemberment: These policies pay a designated amount upon accidental death or loss of limb. Considering that only 8% of all deaths are caused by accidental means, I do not recommend this type policy in the place of true life insurance. Cases of un-insurability and supplemental policies are exceptions to the rule. These are traditionally a guaranteed issue policy no matter your health condition. Once again, talk with me or with another professional for guidance or clarification. Short & Long Term Disability: This type of insurance contract pays a specified amount if you are injured and cannot work. There are a couple pitfalls to be wary of. Let me explain. There are “occupational” and “non-occupational” disability policies. In a nutshell, the “occupational” policy only pays if you get hurt on the job, much like OWCP. In contrast, “non-occupational” contracts pay if you get hurt on or off the job and you cannot work. Make sure you know the difference, and make sure you know which one you have. Contact I or a licensed professional for further clarity or with any questions you may have. Long Term Care: The Wall Street Journal stated: ”… a couple turning 65 has a 75% chance that one of them will need long term care.” My Grandmother spent many years in an assisted living facility with no long term care policy to help cover the cost. When she passed away at the age of 91, she was virtually penniless, and her care was being subsidized by Medicare, Medicaid, and her own children, just to stay in a decent nursing facility. Medicaid will make you spend every dollar you have saved before extending benefits. What does this mean to you? If you are planning to leave an inheritance or anything of value to your family, then plan on taking care of the nearly imminent need for long term care help. There are multiple ways to do this. There are traditional long term care insurance contracts. They are very broad and come in all shapes, sizes, and variations. Know what you’re buying before you sign. There are also 2 very new and I think unique alternatives to traditional long term care policies. First, there are certain life insurance contracts that convert the death benefit into long term care subsidies if needed, while all the while providing life insurance protection, and only converting if needed. There is also a new trend in an absolutely beautiful product that is a savings annuity that works just like a traditional savings vehicle, but if needed to cover long term care costs it doubles in value and is then used to pay for long term care. Talk with me or another licensed professional with any further questions. The best rule of thumb when deciding what insurance contract is best for you and your family is to find an insurance professional that you can trust to do what is best for you, not his commission or bonus checkbook. I highly recommend you look up an insurance broker, such as me. Most Independent agents, like me, are most adept at finding the right policy for you, as well as providing the absolute best in customer service. Being independent allows us to do what is best for our clients and their own unique situations. As an independent broker I have access to over 75 different companies to shop for you the best policy, while most companies pitch you a one-size-fits-all policy from their parent company that truly does not fit every situation. I am passionate about providing for my family today, as well as tomorrow, even if I am not there to enjoy it with them. I trust that as a responsible adult and/or parent that you are as well. How will you be remembered when you die? Are you going to leave behind a laundry list of bills and debt for someone else to answer to, or will you prepare your future to leave a legacy of responsibility and concern for the future of those around you that you loved? We will all leave a legacy when we die. Your legacy tomorrow depends entirely on the preparations you make today, both spiritually, and physically. We at A.C.T. Insurance & Investments want to help you make the most of your:                One Chance…                           To Live…                              To Love…                                      To Leave A Legacy!!!