Six Months, Three Years, Thirty Thousand Dollar discussed on Clark Howard


You're buying cellphone service how do you know forget all the marketing how do you know you're actually getting a company is going to treat you well who does the best job believe it or not the people who do the best job or companies you'd likely never think about so don't wanna be Debbie Downer here the federal reserve put out yet another report about how many of us are one small unexpected event away from financial Armageddon and it is something that you probably have heard these reports from time to time that somewhere depending on how you ask the question somewhere between a third of people to a half the people most recent statement there are federal reserve said roughly forty percent of Americans cannot handle what they identify as a small financial sat back or emergency in their lives which they define is a four hundred dollar expense so something happens when your car breaks down or the air conditioner need to repair your home or you have a medical issue with an out of pocket that you can afford so this is just a reality of modern American life that we as Americans don't put money aside for a rainy day like we used to and it used to be so automatic now I'm gonna sound like I'm from the error the dinosaurs right two generations ago in America we used to have these places you go to called savings and loans and if you are probably under age forty five you don't even know what that was means but they were places that were all their whole reason for existence ways for you to put money aside every week or every paycheck they would go into savings for rainy day it was just something people debt you had all of a printed book it was like a little paperback book the U. taken with you if you go to make a deposit a withdrawal and they'd stamp in the book how much money you had and it was just something people had the you just automatically have I mentioned recently that Americans use to save on average somewhere around sixteen cents of every dollar they made to eighteen cents of every dollar they made through most of modern times but in recent times we've gone from saving negative amounts spending I remember it was a time last decade where Americans are spending a dollar one for every dollar they make today Americans tend to spend ninety four ninety five cents of every dollar they make on average then closed saving for everything retirement kid's college emergencies all that you know I don't I can't help you control what other people do all I can advise you to do is would be great for you to do in your own life the four walls of your own life and that is if you're someone who saving thing just hasn't been part of what you've been about I want you to think about how it lowers anxiety in your life lowers pressure in your life if you get going with us and start with just a penny of each dollar you make if you have any kind of retirement plan available to you at work start putting one percent of your pay and that plan we listen to me for a long time you know I'm all about incremental change in building habits so six months from now I want you to go up to two cents of each dollar six months after that three cents of each dollar if you do it in baby steps you'll be amazed in five years you'll be saving a dime of every dollar you make but you've done it slowly but you've changed your habits we don't have any kind of retirement plan at work you can do it with an online savings account which I guess is the modern equivalent of a savings alone those are paying two point whatever percent many of them or you could open your own Roth IRA and start putting money into yet little bits at a time automatically growing at and remember every six months your assignment step it up another penny hi mark our car gallery in great thank you mark how can I be of service mark I am new to your show what I wish I would've found you will sooner before I got involved into my whole life policy almost three years into it now spending a hundred dollars a month finding that now Hey you got thirty grand in this thing already yeah so it's a friend of mine introduced me to you know I took my golfing and wine and dine me and so a thirty thousand dollar around the call how was it we got so what I want to know is where you go from now where where to go to now I I got it for you really easily now one thing I have the name of the company that the policy as well and it is a very respected company in fact of the companies that sell life insurance it's perhaps one of the highest rated so I really really like the culture of that company but it doesn't mean they're buying a whole life policy is the right thing for you to do and it's hard to know but one thing have you gotten your most recent annual statement to see what the cash value of the policy is right now in a pile of in my mail yeah where I get all the statements from so I haven't read it yet but I think I have gotten it right so you paid in roughly thirty grand and what you want to know is how much value you have in that policy right now versus how much was taken away by commissions and fees charged by the insurance company so that's a sunk cost you you know if it says you have a value in that policy right now of let's say ten thousand you put in thirty thousand your twenty thousand upside down right all right but the thing is what happens with these life insurance policies is the longer you're ran the more that cash value starts to recover and eventually typically somewhere about year twelve to fifteen you'll end up where you're above water in the policy that's a long time from now exactly so it's a hard dilemma and I've got a way for you to solve it there's a service you can buy on the web do you can have a full independent analysis done of your individual policy that you bought three years ago and they'll be able to tell you keep it dump it or you may have with those a conversion privilege and that they would want you to.

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