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Home is where the heart is. It’s also where a big chunk of your financial responsibility lies. Home ownership is a pillar of the American dream, and while many of those in younger generations either can’t afford to or actively choose not to pursue it, those who buy in to the housing market often see major financial benefits.
There is no doubt that becoming a homeowner is one of the biggest financial decisions you will make in your entire life. It’s also undeniable that simply getting to that point requires a certain degree of financial success. You need to come up with a down payment and closing costs (generally about 3 percent to 4 percent of the total home purchase price for buyers) before you can even turn the key in the door. But among those who take on the big task of home ownership, many see financial benefits that far outweigh their initial investment, especially during tax season. Here are 5 of them. 1. Build up a stronger financial future The recent recession threw a wrench into the idea that home ownership always builds wealth over time. But the fact remains that owning a home is one of the fundamental means of accumulating wealth as we age. The caveat: you have to buy a house that you can actually afford. Asset-wealth is a much more secure predictor of future financial stability than income, which can—and often does, in today’s evolving economy—change from year to year. In a strong economy, home values generally increase by 3 percent to 4 percent every year, thanks to inflation and natural population growth. From 2011 to 2016, as the housing market has recovered from the bubble that contributed to the recession, home values have been increasing even higher at an average rate of 6.3 percent a year. Putting money into home ownership versus a rental is akin to the difference between putting money into an investment account versus a no-interest checking account, with the latter being only as valuable as it is in the moment while the former increases over time. 2. Home ownership tax deductions You get a number of tax breaks for owning a home, most notably a deduction for the interest and property tax portion of your mortgage. This deduction is particularly useful for off-setting the initial financial blow that comes with purchasing your property, since in the first years of owning your home you’re mostly just paying off the interest on your mortgage, as opposed to the principal. The first year you buy your home you are also able to write off any mortgage points on your loan, which can lead to pretty considerable savings depending on how many points you claimed. And if you ever decide to refinance your home after building sufficient equity in it, you also have the option of taking out a home equity line of credit, which is itself tax deductible. Do keep in mind: the Tax Cuts and Jobs Act, passed in 2017, limits mortgage interest deductions to $750,000 of your total mortgage debt, including any home equity credit you take out. Previously, the limit was $1,000,000 in mortgage interest deductions plus a $100,000 for home equity credit. Read up on the new rules here. 3. Amass equity Every single month that you pay your mortgage you own just a bit more of your home. This is a big benefit over renting, where you’re paying comparable monthly fees without any comparable stakes. The equity in your home builds in two ways and often concurrently: (1) equity builds as the value of your home increases, and (2) equity builds as you pay off more of your loan. These two factors mean that after the first couple of years (when, again, you’re mostly just paying mortgage interest), every month you pay money toward your loan you are building up your financial resources for the future. It’s why some people refer to mortgage payments as “forced savings.” Want to build equity even faster? Take steps to pay off your debt quicker (like financing with a shorter term loan or paying more than you owe every month) or increase your property value (think home improvements and a focus on routine maintenance). 4. More control over day-to-day housing-related costs Unless you change the terms of your mortgage, you know the base cost that you’re going to be spending to live in your home every month, both now and in the future. This affords more stability than rent, which is variable and can (and often does) change over time. And control over costs goes even further than that. As a renter, you don’t have a say over whether your landlord supplies you with energy-efficient appliances that can save you hundreds of dollars every year, but you do have to pay the utility bill either way. As a homeowner, you can make better short and long-term financial decisions that are geared specifically toward your own financial goals and abilities. While this isn’t likely going to help you save for your future in the same way building equity does, it should bring you peace of mind to know that you’re saving money everywhere that you can. 5. Positive perks Home ownership has other financial benefits that may come in handy for you someday. For example, a mortgage is considered “good debt,” and as such, it is likely to increase your credit score, provided you always make your payments on time. It also proves your credit-worthiness for other things you may want to consider, like a business loan or a new line of credit. It can even lower your monthly car insurance payments. While perks like these should certainly not be deciding factors when determining whether or not you should purchase a home, they do add up as additional benefits if you choose to opt in to the housing market. But what about the financial risks? Owning a home isn’t all equity building and cost cutting. Aside from the significant payments that have to be made in order to own a home in the first place, there are also some financial risks that all potential and current homeowners need to keep in mind when trying to balance their budgets. The biggest financial risks for homeowners are in terms of maintenance costs. There’s no landlord to put the responsibility on if the roof starts leaking or the heating system goes out in the middle of winter. While you’re unlikely to face major repairs like this all of the time, they do occasionally come up and it’s important for all homeowners to have savings set aside to deal with them when they happen. Then there’s the risk of home depreciation. Ultimately, it’s your home’s land that appreciates in value over time, barring any major negative changes in your area like a natural disaster or a school or major business closing. The structure of your home, however, tends to depreciate in value as things get worn out and lived in. While you don’t have a lot of control over what goes on in your neighborhood that may negatively impact the price of your land, you do, fortunately, have some control over maintaining and increasing value on your home’s structure by keeping up with maintenance and putting in certain home improvements. Don’t let your home’s value be something that you just tacitly accept—work toward making sure your home, and not just the land it sits on, is appreciating as the years go on.
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As employers prepare post-COVID-19 workplaces, supporting employees’ mental health can be as critical as creating a safe physical environment. Safety measures, such as sanitizing protocols and respiratory hygiene, are vital considerations for physical wellness. Taking a broader view of employee health that also includes emotional and social wellness can help employees manage uncertainty, engage in the workplace and adjust to a “new normal.”
Focusing on mental health is especially important during the readjustment phase. Employees may bring new stressors after weeks of sheltering in place that employers need to consider – from fear of infection at work to personal issues, such as child care concerns or substance abuse. Some may have delayed medical care, while others may be feeling financial stress or mourning lost loved ones. Others may be feeling the toll on their mental health in the form of anxiety, sleeplessness or depression. Emotional and Social Reintegration in the Age of COVID-19 “These uncertain times are stressful, and we know that stress can lead to poor performance and poor health,” said Dr. Marcos Iglesias, Medical Director at Travelers. “Now is the time to start conversations about the future and drafting a road map that works for your organization.” As COVID-19 restrictions are gradually lifted, recognizing employees’ emotional and social health can help them reintegrate into the workforce and allow employers to offer additional resources when needed. Here are some strategies to help support mental health as employees return to work: 1. Practice Clear and Frequent Communication Communicating with employees about plans to reopen can help keep them engaged and provide a sense of normalcy. Employees will want to hear about their company’s response plans, from social distancing to wearing personal protective equipment (PPE), as well as details about workforce and financial stability. “It is important for employees to know what to expect as they return to the workplace,” Dr. Iglesias said. “That can help remove some of the uncertainty and reassure employees that you have their best interest in mind.” When you share public health and safety information with employees, it should come from credible sources, such as the Centers for Disease Control (CDC), state health departments, and reputable medical organizations and journals. 2. Train Supervisors to Recognize At-Risk Employees While many employees will be fine once they return to work, there may be some who have a harder time reentering the workplace and readjusting. Supervisors and managers can play a critical role in communicating with employees, providing stability and recognizing signs of distress. A recent study shows that 57% of workers are comfortable with their manager asking them about their mental health and 41% want their manager to proactively ask them. It’s crucial that supervisors and managers are trained in how to recognize employees who may be in distress and to know when and how to intervene. A simple, “Are you okay?” may open the door to better communication and provide an opportunity to gauge an employee’s mental health risk. Supervisors can also create a welcoming environment for employees who may be returning in a modified duty role or who may have recovered from COVID-19 and may fear being stigmatized. Setting expectations and having clear communication can help these employees readjust to the workplace. 3. Evaluate Flexible Work Arrangements Employers may want to consider flexible work arrangements, such as adjusted schedules and remote working when possible. These may be necessary during reintegration to reduce stress for those dealing with personal and family issues, such as school closures or caring for loved ones. Companies may also need to reconsider their policies for paid time off, sick leave, leaves of absence, disability and bereavement, based on unique situations that their employees face. Continuing the open communication once employees return can help address challenges and identify solutions. 4. Consider Workplace Accommodations Returning to work may create anxiety for some due to social proximity, especially when using shared workstations, shared dining space and food prep areas. Employees may ask for accommodations, such as separate work areas, physical barriers, face masks, PPE, cleaning equipment and working from home. This may be especially important for certain employees, such as those with chronic medical conditions and those over age 60. 5. Provide Access to Mental Health Resources Employers must have available mental health resources for employees in need. This may take the form of an Employee Assistance Program (EAP) or a referral to external organizations that can provide crisis intervention, counseling or other assistance. Easy access to and promotion of a company’s EAP can help provide many helpful resources – not just mental health – to employees in need. The COVID-19 pandemic has activated a surge in the use of telehealth, including remote and virtual interactions between individuals and healthcare providers. Access to telehealth can be an important part of an effective strategy for facilitating care to employees post COVID-19, and may offer an efficient alternative to in-person rehabilitation, addiction and mental health appointments. Resilience training may also help employees feel more empowered as they return to work. There may be cases when urgent intervention is needed: suicide risk and threats of violence. Employees need to know how to identify this risk and what to do in these crisis situations, and providing them with a plan is imperative. Whether you and your family are driving to the zoo, the lake, or visiting relatives, you are part of the American tradition of the road trip. Part of the appeal of a road trip is all the fun along the way. So, to make sure you’re prepared for your spontaneous adventures check out these tips:
1. Take your vehicle in for maintenance Oil changes, tire rotations and brake pad replacements are all great ideas before your big trip. Tell the mechanic about your road trip plans and approximately how many miles you plan to travel in your vehicle. They may be able to spot potential issues before you leave to avoid a problem on the road. 2. Review your auto insurance policy It’s a good idea to review what your auto insurance covers before you hit the road. Things like road trouble service and rental car coverage may be important to know if they are included on your policy. 3. Check the weather at home and your destination In the days before your trip, you’ll probably watch the weather forecast for your destination and route. However, it’s also a good idea to check the upcoming weather for your home. The last thing you want is to come home and find that a tree has fallen on your house, or that your basement has flooded. See what the forecast says and ask a neighbor to check on your house once a day, especially if there’s bad weather. Be sure you leave them a reliable contact number. 4. Renting a vehicle? Make sure it's covered If you decide to rent a vehicle for your road trip, contact your local insurance agent to learn about rental car coverages. Most rental companies will ask if you want to purchase insurance for your rental car. But, you may not need it. Your independent agent can check your existing auto policy for any coverages that may apply and can discuss coverages you may be able to add. One coverage to ask about is rental gap coverage. Unless you've read the fine print on the rental contract you probably haven't heard of this coverage. Your local insurance agent will know and can help you feel confident signing your rental agreement. Rental Gap Coverage: Let’s say you crash your rental car and it’s worth $20,000, but the rental company decides to sell it for $10,000 instead of fixing it. Without rental gap coverage, you are responsible for the difference. 5. Arrange roadside help before you go Roadside trouble service can be a vacation saver and you don't have to be a member of an auto association to get it. If you have any questions whatsoever, call Theodore & Associates today and we'll get you road trip ready! With the holiday weekend ahead of us, many of you may be doing some local travel. The weather hasn't been great lately, so please consider these driving tips if you encounter a tornado!
What to Do If You’re Caught in Your Car During a Tornado Tornadoes are the most violent storms anywhere, and about 1,200 touch ground in the United States every year, according to the National Weather Service (NWS). They’re as unpredictable as they are violent, most often occurring in the early spring on the Gulf Coast, in May and June on the southern plains, and in June and July in the upper Midwest. But, tornadoes can occur any time of year and have been recorded in every state, says the NWS. If a twister forms when you’re traveling through an unfamiliar region, or even while driving near home, you don’t have much time to make smart decisions that can help save your life. The NWS and Red Cross recommend these actions if a tornado catches you while you’re on the go: Be Alert and Prepared 1. Know the difference between a watch and a warning:
If You’re Caught Outside or Driving 1. Don’t wait to see a funnel once you hear a Tornado Warning.
Always remember, whenever you encounter severe weather that a violent storm can escalate and travel quickly. If you’re at home, be ready to put your emergency plan into place, if you can – practicing family drills and setting aside supplies ahead of time will help. If not, take the most appropriate safety measures possible, such as the ones shared above. If you have 10 or more employees, a group disability benefit may be a valuable addition to your employee benefits package. Group disability plans typically provide a totally disabled covered employee with a benefit of up to 60% of their pre-disability income, to a specified maximum, such as $10,000 a month. It can help to cover personal expenses as well as provide business overhead protection. Advantages of a group plan include:
Drawbacks to group disability plans include:
Game Plan When offering voluntary disability benefits or buy-up options to your employees, access to information is important. Determining how much disability insurance your employees need and can afford requires them to examine their income, assets, expenses and liabilities, and then to figure how long they could keep everything going if they were unable to work. Theodore & Associates can help you every step of the way! Call or email us today! The COVID-19 pandemic has impacted every part of daily life, from sheltering in place to lost paychecks. While car insurance is no exception, the good news is that every major provider has pledged to help Americans in need like never before. To separate fact from fiction, we spoke with experts and analysts across the country to determine exactly how the coronavirus crisis will affect your car insurance.
Is my insurer going to give me money back? As of March 22nd, the number of cars on the road had fallen dramatically, about 20%, following the declaration of a national emergency in the U.S. Many of the largest auto insurance companies recently announced they will be responding to the lowered risk of auto claims with premium rebates for customers. State regulators are also putting pressure on all insurers to step up to support consumers with measures like extended grace periods, so if your insurer hasn’t yet responded with meaningful actions, you can routinely check its website to catch updates or reach out directly. Should I change my auto coverage because of COVID-19? While you can definitely reach out to your insurance company to see if your lowered mileage could mean a discounted rate, keep the following in mind: Don’t cancel coverage you’ll need in the future. Canceling your car insurance, even if it’s only for a limited period of time, can have several negative impacts:
How can I lower my monthly payments? Increase your deductible Your deductible is the amount of money you agree to pay out of pocket before the insurance coverage will kick in. Increasing your deductible helps lower your premium because you’ll be on the hook for a larger part of any potential losses, but that also means saving on your bill now is something you’ll need to weigh with your ability to take that additional risk. Reduce your liability coverage limits Lowering your liability coverage limits can also help you save on insurance, but it will likely make a smaller dent than changing your deductible. Your car insurance coverage will have both bodily injury and property damage liability, or the maximum amount your insurance company will cover, if you cause damage to someone else or their property. Switch to a usage-based plan If you’re driving fewer miles than usual, you may want to consider a usage-based car insurance plan. While traditional car insurance is priced using factors like your age and claims history, usage-based insurance relies on driving data (usually gathered through an app on your phone) to determine how much you pay for coverage. Many larger insurers are starting to offer usage-based options. This option would be best for users who are likely to benefit from a usage-based policy for the long-term, though. Switching insurers too often can signal that you’re not a loyal customer, which can mean you may be quoted higher rates from even other insurers in the future. Will my future auto insurance premiums be affected by COVID-19? Most drivers are well aware that an increase in claims can spike car insurance rates, but the economy as a whole is also closely tied to an insurance company’s business. Will auto insurance claims be affected by COVID-19? With social distancing measures in place across the country, insurers are making sure their employees and customers stay safe by keeping the claims process digital. This may be a big change from a typically hands-on process or you may not see a change at all. What if I can’t afford my auto insurance payments because of COVID-19? If you are struggling with your car insurance premiums, you should contact your insurer. Many are addressing the COVID-19 pandemic with programs to assist policyholders. For more information, please contact Theodore & Associates today. As you make your way through your spring cleaning checklist, don’t forget to dig out your insurance policies and look them over. Below are some of the reviewable elements of your home, life and auto insurance policies.
Homeowners Insurance 1. Make sure you’re not overpaying for insufficient coverage Experts say the top insurance mistake is being underinsured, which happens when you fail to update your coverage as your property, lifestyle or needs change. Take the time to assess those changes and determine where you need to adjust your insurance coverage. For example, if you like to entertain at home, consider increasing your liability coverage and purchasing a separate umbrella policy. Umbrella liability policies typically offer a minimum of $1 million of additional liability protection and cost just a few hundred dollars a year. 2. Pay attention to increased rates Insurance companies don’t always tell you how much your rates increased on renewals. While doing your spring cleaning, grab last year’s documents and compare the rates for yourself. If your rates rose by five percent or more, call your insurance agent and ask them to explain the increase. Knowing whether the increase resulted from changes in your risk profile or from general increases in the marketplace can help you negotiate and shop for comparisons. 3. Learn how to lower your premium You may be eligible for discounts that can lower your homeowners insurance premium. Our golden rule is to ask! You may miss out out savings if you don’t ask what is available. 4. Make sure you have enough personal property insurance Most people do not take the time to inventory their personal possessions, and often do not have enough personal property insurance as a result. Homeowners should be careful not to overlook their belongings as a way to keep insurance costs down. It is very likely that you have added new belongings to your home over the last year. If so, now is the time to inventory those belongings and ensure you have the right type of coverage for the actual value of your property. Most consumers automatically accept the amount of contents coverage named in their policy. Instead, read the policies carefully to make sure there are no gaps in coverage, and check the dollar limits and excluded causes for personal property. It is in your best interest to raise the dollar limit if necessary, as it will help you better replace or recover the value of your possessions if disaster strikes. Having an updated list and video footage of your belongings could help you recover the true worth of your belongings. Life Insurance If you have a life insurance policy, you should make sure to review its principal points at least once a year, including beneficiary, benefit amount, term, loans and cash value. 1. Update your beneficiaries Many of us forget to update our policies when circumstances change. Life events such as marriage, getting divorced or having children should prompt you to update your beneficiaries. The beneficiary designations on your life insurance policy will trump any other documents you’ve created outlining your beneficiaries, so ensure that they match! 2. Review the term of your policy If you have term life insurance, it’s important to know when the term ends. An annual review will prevent a term policy expiration from sneaking up on you. If you are caught unaware, you may face a major premium hike. Some term policies may be convertible to permanent insurance on their anniversary, which others may be convertible at the end of their term. 3. Assess the amount of your policy Make sure the amount of your life insurance policy is still appropriate for its intentions and for your financial situation. Take time to evaluate what you intend for the benefits to cover. Are you hoping to fund your burial expenses, or provide college tuition for your children? Does your policy provide sufficient coverage for these needs? If not, it may be time to look into additional coverage. If your personal wealth has increased significantly in the last year, you may consider more life insurance in order to protect your family from estate taxes. Auto insurance 1. Reassess your comprehensive/collision coverage If you have collision and comprehensive coverage, take time to make sure the limits are adequate, or whether you still need it. If you don’t have the coverage, consider whether it’s time to add it. If you’re driving an older car worth less than $1,000 – or less than 10 times the insurance premium – having comprehensive or collision coverage may no longer make sense. Dropping either the comprehensive or collision coverage may reduce your premium. 2. Ask about any new discounts. Ask about any discounts that you may qualify for, such as:
For questions about your insurance or to get a quote, contact us today! Nearly 17 million people have filed unemployment claims in the last three weeks with the U.S. Department of Labor. Forecasters predict as many as 20 million people could lose their jobs by the end of April. Millions of workers who have lost their jobs also will lose their health insurance. The potential severity of COVID-19 means that being uninsured could leave people at risk for catastrophic health care costs. Here are some key things people who lose their jobs or who are currently uninsured should know. Coverage Options for People Who Lose Their Jobs or Are Uninsured If you have insurance through the job you lost: Maintaining your coverage through COBRA is a possibility, but you might find a cheaper option through the Affordable Care Act’s marketplaces. As always, even though open enrollment is closed, anyone who loses a job with health insurance is automatically eligible for a special enrollment period through the marketplaces. The first thing to do after losing job-based coverage is visit HealthCare.gov to check out options. If you qualify for a premium subsidy or Medicaid, there may be options much cheaper than COBRA. If you have coverage through the ACA marketplaces: If you lost your job, your income is likely dropping, which means you may qualify for a subsidy. Go to HealthCare.gov and update your income information. If you have coverage through Medicaid: Keep your coverage and make sure your enrollment status is up to date, so you don’t lose your coverage if you forget to reenroll. If you are uninsured, you have a few options — and there may be more in the coming weeks:
Recent Legislation and Executive Branch Actions on Coverage Congress has passed three major emergency spending bills to address the pandemic and the administration has declared a national emergency. Here is what you should know about what this means for coverage:
Looking Forward The staggering economic disruption triggered by the coronavirus pandemic is revealing the importance of the Affordable Care Act in providing coverage options for people who lose their job-based insurance. But the pandemic also shines a bright light on the remaining holes in the system: 30 million people uninsured and at least 44 million who are underinsured because of unaffordable deductibles and copayments. The crisis will place added pressure on the states that have not yet expanded Medicaid and may encourage them to move forward with expansion. It also may push Congress to permanently patch the holes in our insurance system. If it does, the next time we face a public health crisis we can be secure in the knowledge that everyone has health coverage and that illness will not be compounded by personal financial catastrophe because of health care costs. If you need assistance or don't know what your next step should be, feel free to call us and get help. We can offer Short Term Health Plans, Limited Medical Plans, and Major Medical Plans with loss of other coverage, to individuals who may be in need, or just offer friendly advice during this difficult time! Your building is now vacant due to Shelter in Place Key Tips to Consider... As we weather this national crisis and shelter in place, many of our buildings and surrounding property are attractive targets for thieves and other would-be criminals. Before shuttering your doors and leaving your business for, what could be, weeks at a time, consider these tips... Utilities
• Are unnecessary electrical appliances and equipment disconnected/unplugged. • Turn down temperature on hot water heater to conserve energy. • Set thermostat to minimal setting (55° F) to conserve energy but keep out the freeze and/or set low temperature alarms. Failing to maintain heat appropriately can void coverage if pipes freeze and burst. • Sprinkler system also need to be protected from temperatures below 40F to ensure proper operation. • During warmer months or in warmer climates, make sure to set your air conditioning to a minimum of 85 degrees otherwise if your building gets too warm it will become susceptible to damage from humidity and mold. • Check that sump pump is operational and remote alarms are working. • Ensure all refrigerators and freezers are secure and doors are closed. • Irrigation systems should be turned off and disconnected to prevent accidental flooding. Security • Does the building look secure from the street? • Are all vehicle entrances and exits locked/secured? • Are all windows and doors locked? • Have you contacted the police and requested random checks? • Have you alerted neighbors or neighborhood watch programs that the building will be vacant so they can also assist with random check? • Is there a centrally monitored security system in place (door contacts, window tape, motion sensors, video surveillance, etc….) • Has updated contact information been given to companies that centrally monitor security and fire alarms, as contact names/information may have changed from normal operations. • Arrangements should be made, if possible, to inspect the building at least weekly. Document the inspection with photos and utilize our check list. • Can security camera be added or maintained operational to cover the interior/exterior of the facility? o Have temporary, wireless cameras been considered? • Are there exterior aspects of your building that you need to consider: o Temporary weather proofing; o Drainage or flooding hazards; o Gutters and down spouts cleared? • Contact your agent to discuss potentially relocating some high dollar items, temporarily to a more secure location. Inventory • Do you have a list of inventories on hand? o Is it backed up off site? o If it were stolen or damaged what would you need for lead time to replace those items? • Tools and Equipment • Computers and Technology – Are there backups made daily with offsite storage of back-ups? • Furniture, Artwork, Fixtures. • Other Assets Perishable Inventory • Do you have products on auto-order that needs to be suspended for the time being? • Are you practicing all the necessary requirements per your local health department or FDA guidelines? • Do you have a remote alarm on refrigerators and freezers so that you are made away of a temperatures spike? o If this were to occur do you have a plan in place for dealing with this alarm? • Are you maximizing the products on hand to consider items reaching expiration? Fire • Have you contacted the local fire department to alert them of the vacancy and any changes to building access that now may have changed? • Additional monitoring may be necessary because of the following reasons: o There may be a delay in reporting of fires because of the vacancy o Fire could also start due to smoking trespassers, arsonists, faulty wiring or drug production. o Transients/homeless seeking shelter may have open fires for cooking or providing heat. • Are there centrally monitored fire detection systems in place? • Is the Automatic sprinkler system on and locked open with centrally monitored tamper switches operational? Making a plan for how to respond Having a good response plan is as essential as protecting your business investments. When developing a plan, consider communication beforehand with local responders, such as fire and police departments, emergency clean-up companies and security companies. Your livelihood may depend upon it in an emergency. And remember, if you have a helper with you when closing down, be sure to “social distance” from one another. Keeping your house clean is especially important in these trying times of COVID-19 right now. Are you tired of spending money on multiple cleaning products that take up a lot of space? Often, with just a few simple ingredients, you can make your own cleaning solutions at home. Most homemade cleaning products are a fraction of the cost and are typically better for your health and the environment. Get started with these five everyday cleaning solutions:
Reposted with permission from BlueChoice Health Plan. |
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