Financial planning often results in bad laps. Because some industry participants sell products rather than dealing with financial concerns, some of the problems are self-reflective. However, the process of planning is important whether you go with a professional or do it yourself. After all, you should not make a long trip without seeing the map - a similar kind of analogy to some of our men, you get that idea.
Where should I begin? It really depends on you and your circumstances. Everyone needs a unique plan because everyone has different goals, needs, risk tolerance, and concerns. However, in general, you need to consider at least three major areas of insurance, investment, real estate planning. You can fill out the library with all the information you need to properly deal with these issues, but here's a hint to get started.
Insurance
Insurance is confusing. It comes in all shapes and sizes and covers everything from your car to your health. You can even purchase insurance covering you against the reaction of foreigners. Also, as with many areas of the plan, insurance, depending on your situation, may be especially complicated for single.
· Life insurance. In some singles this may not seem like an urgent problem. But for singles with dependents, it is important. Stick to long-term life insurance contracts - more expensive life-long insurance and universal insurance are worthless of extra expense. You may need more, usually like a child with special needs, if you have multiple dependents or unique expenses, but enough insurance equivalent to 8 to 10 times the annual salary You should purchase it. In addition, disability insurance is also a good idea because there is a possibility that second income can not be obtained if you can not work.
· Health insurance. Most of us count health insurance as one of the main employee benefits. For married employees, this insurance is usually also available to employee's spouse, so the benefits will be even bigger. In the case of a couple who is not married, it is quite another story. Some companies provide medical and dental benefits to domestic partners, but that is not always the case. Also, even if these benefits are provided, they are usually taxed as income at fair market value. There are exceptions, but you need to qualify as an employee's employee, and annual income is less than $ 3,100. This is useless for many partners.
Investment
Successful investment is a difficult and time-consuming process. We will explain in a later issue in detail, but keep in mind these problems if you plan to organize your investment plan yourself.
· Be patient. There is no magical system that will help you consistently defeat the market. Can I actually buy it for $ 299 on the Internet, if any? Investment is not a rich and fast scheme, but a long-term process that requires perseverance, discipline, and experience.
· It diversifies, but does it moderately. Most people own hundreds of shares and bonds both directly and through mutual funds. There are hundreds of wonderful investments there. Having a portfolio with a manageable level of high quality stocks and possessing strong performance and low expense exchange funds or mutual funds is far superior.
· For sale. Most people are focused on purchasing stocks. It is important, but it is even more important to sell shares. If you drop 10% of your purchase price, manage the risk by selling the stock you lose. Also, if you are making a successful investment, please make a profit on the way. There are more than a few people who want to do in March 2000.
· Mutual funds are not necessarily answers. Many people use mutual funds as the basis of the investment portfolio. Since most mutual funds are consistently below the market, this can be a problem. In addition, mutual funds are very expensive and contain hidden rewards that do not appear in the disclosed expense rates. These hidden charges can cost you a few thousand dollars and you can take a huge bite from your return. By mixing individual stocks and funds exchanged at exchanges, you can improve profit margins and reduce costs.
Develop a unique approach. For example, my investment style is probably best described as opportunism. We will make a discreet investment until an attractive opportunity is born and deploy capital accordingly. It matched my personality and worked fine for my client, but that is not right for everyone. Some people want more risk, some want less investment and others do not have time to invest investment and monitor. Find and stick to strategies that match your own risk tolerance, goals, and preferences.
Real Estate Planning
Singles' retirement plan may be difficult. For example, most qualified retirement plans, such as the 401 (k) plan, cover married couple, and in many cases do not provide a lifetime distribution to unmarried beneficiaries. This can cause a significant tax headache for beneficiaries. There are some other issues to consider
· Confirm that there is a will. This may seem obvious, but surprisingly many people are ignoring the steps of this basic plan. Quarantine laws are complicated and time-consuming, but it is not always the case that you transfer assets where you like. Also, if there is only one parent, please give parental name for children.
· Designate the beneficiary of the IRA account. As IRAs do not pass your intention, you need to implement another beneficiary design to ensure that the IRA passes to your beneficiaries.
· Perform a permanent power of attorney. This power of attorney should cover not only your business issues but also your health management decisions. I hope that these documents are unnecessary, but in that case, I am happy to think about it first.
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