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Teaching Kids Financial Responsibility

Parents need to instill responsible financial behaviors in their children starting at a young age. As the father of three financially-independent daughters, Dan Danford, CFP® and Principal/CEO of Family Investment Center, shares his real-life experiences along with some helpful financial advice as you attempt to teach your children fiscal responsibility.

In this video, Danford addresses the question, "Growing up I had to learn the hard way how to handle finances. Having experienced those hardships, I want to help my children avoid as many of the painful lessons as possible. How would you suggest attempting to teach your children financial responsibility?"

LTC Benefits? Beware this Hybrid Product (Agents are Selling the Heck Out of It!)

I’ve met with three different people in the past month who were contemplating or, in one case, had already purchased a unique new “product” offered by insurance companies. The product is actually a combination of two products; an annuity and an insurance policy. They pair these two together and then “include” a Long Term Care (LTC) benefit from the combination.

The LTC benefit is what customers think they are buying. It is certainly what agents are selling.

But the LTC is really just an acceleration of the death benefit that they’ll have to pay (upon death) anyway. So, they sell the future value of the annuity plus the death benefit, and then show that you can withdraw from this future amount in monthly LTC benefits. But, of course, those benefits are deducted from the eventual death benefit. They are giving your own money, and claiming it’s an LTC benefit!

If you separate the two, the annuity amount will likely grow better and quicker as an investment account or IRA and a term life policy will be much cheaper than whole life insurance. But insurance illustrations never show the opportunity cost of 1) lower annuity returns, and 2) the inferior investment component of the life insurance policy. The agent doubles up his commissions (whole life policy and annuity) and the insurance company makes ongoing fees from both parts (and possibly adds a fee for the accelerated death benefit). And then it pays a quasi-LTC benefit from your own money! It’s a ridiculous product, but they are selling the heck out of them today.

My recommendation? Beware this sales gimmick. If you genuinely need LTC insurance, buy that product directly from a reputable source. If you need life insurance, buy a term life policy to cover your beneficiaries. Annuities? Find a better place to invest your money.

Asset protection in divorce

Asset protection is an area of law in which your attorney works with you to ensure that the assets you have worked to accumulate are legally safeguarded. Divorce is a major financial event that can have repercussions for years to come, as it often is difficult to financially recover once your assets are split.

Dan Danford, CFP®, CRSP®, MBA, and Principal/CEO of Family Investment Center, shares his financial tips on what you can do to make this transition a little easier financially as you try to protect your assets in divorce.

Money anxiety can be treated

Dan Danford's article, "Don't let your emotions affect your finances," was recently published in Medical Economics magazine. In the article, Danford explains that behavior has greater impact on finacial success than income, and suggests that money anxiety can be treated. Click here to read the full article.

Health insurance for your pet? Surprising thoughts from Dan Danford

Pet insurance: a topic that would seem insane 20 years ago is now a booming industry with one million pets and counting covered by insurance. Revenue for U.S. pet insurance plans was more than $300 million in 2009 is predicted to reach $753 million by 2014, according to consumer research firm Packaged Facts. But does pet insurance make sense for you?

Dan Danford, CFP® and Principal/CEO of Family Investment Center, shares his financial tips on whether owning pet insurance makes financial sense.

Five tips to avoiding financial scams

Dan Danford, CFP® and Founder/Chief Executive Officer of Family Investment Center, answers this week's episode of Money Made Easy:

I used to believe I'd be able to tell if I was being scammed or not, but now I am not so sure. What are some good ways to ensure you are not hurt in a financial scam?

It seems every day you read about a new financial scam bilking people out of their hard-earned money, but how can you ensure you are not caught up in one of these financial scams? Danford shares his five financial tips to avoiding financial scams.