Expert Insights
Ross Loehr
Certified Financial Planner® at Raisonné & HammerPrice Corporation
Is there a correlation between the level of educational attainment and retirement outlook among Americans?
There is a clear correlation between educational attainment and retirement outlook among Americans. Studies consistently show that individuals with higher levels of education tend to have better retirement preparedness, as they often have higher incomes, access to retirement plans and a greater understanding of financial planning.
What would be a comfortable retirement savings account for a 25 to 30-year-old individual looking to retire at 60?
For a 25 to 30-year-old individual looking to retire at 60, a comfortable retirement savings account should aim to accumulate 10-15 times their annual income. This target has historically provided a suitable nest egg to maintain their desired lifestyle during retirement.
What are some quick ways young professionals can start their retirement plans or complement the ones they already have?
Young professionals can start their retirement plans or complement existing ones through these simple steps:
-
Begin contributing to an employer-sponsored retirement account, such as a 401(k) and take full advantage of any employer-matching contributions.
-
Open an Individual Retirement Account (IRA) to supplement retirement savings and benefit from tax advantages.
-
Increase contributions gradually over time as your income grows.
-
Diversify investments to maximize growth potential and mitigate risk.
-
Seek guidance from financial advisors or utilize online tools and resources to develop a comprehensive retirement plan.
https://www.moneygeek.com/insurance/life/how-does-life-insurance-work/#expert=ross-loehr
What is the most important factor to consider when selecting a life insurance policy?
The most important factor to consider when selecting a life insurance policy is understanding your coverage needs and financial goals, as this will determine the appropriate amount of coverage and policy type required.
-
Coverage needs: Assessing financial obligations, debts, dependents and long-term goals.
-
Policy type: Differentiating between term life, whole life, universal life and variable life insurance options based on affordability, flexibility and investment components.
How can individuals identify which type of life insurance best suits their needs and goals?
Individuals can identify the type of life insurance that best suits their needs and goals by evaluating factors such as budget, coverage duration and investment potential.
-
Budget: Consider affordability and premium payments over the policy term.
-
Coverage duration: Determine the desired length of coverage based on financial obligations and dependents.
-
Investment potential: Assess the need for cash value accumulation or investment components in policies.
What strategies or tactics should someone use in order to save money on life insurance premiums?
To save money on life insurance premiums, individuals can employ several strategies and tactics:
-
Shop around and compare quotes from multiple insurance providers.
-
Maintain a healthy lifestyle, as insurers often offer better rates to non-smokers and individuals with good health.
-
Opt for term life insurance, which typically has lower premiums than permanent life insurance.
-
Consider bundling life insurance with other insurance policies, such as home or auto insurance, for potential discounts.
What are the factors that typically determine the cost of life insurance?
Factors that typically determine the cost of life insurance include:
-
Age: Younger individuals generally pay lower premiums as they are considered lower risk.
-
Health: Medical conditions, lifestyle choices, and family medical history can impact premium rates.
-
Coverage amount: Higher coverage amounts result in higher premiums.
-
Policy type: Permanent life insurance policies tend to have higher premiums than term life insurance.
-
Gender: Women often pay lower premiums due to longer life expectancy.
-
Occupation and hobbies: Risky occupations or hazardous hobbies may result in higher premiums.
https://www.moneygeek.com/credit-cards/average-credit/#expert=ross-loehr
When might it be worth getting a credit card for fair credit with an annual fee?
Obtaining a credit card with an annual fee for fair credit may be worthwhile if it provides valuable perks or rewards that offset the cost. Another reason to get a credit card is if it helps establish or improve credit history for future financial goals. It's important to use the credit card as a tool to improve your financial profile and future opportunities if possible.
Might getting a secured card work better than a card for fair credit in any situation?
In certain situations, a secured credit card might be a more suitable option for someone with a fair credit score. It allows individuals to build credit while providing a higher chance of approval, which makes it an effective tool for credit-building or credit repair purposes. This can also help you avoid overspending and/or falling into debt.
Should one close a credit card account after seeing an improvement in their credit score?
Closing a credit card account after seeing an improvement in credit score should be carefully evaluated. It is often beneficial to keep the account open, especially if it has a long credit history, low utilization and no annual fees, as the account age contributes positively to one's credit mix and overall credit health. Using a credit tracking website like Credit Karma can help you track all of your open accounts and the credit history of each.
https://www.moneygeek.com/personal-loans/excellent-credit/#expert=ross-loehr
What is the best way to compare different loans available for those with excellent credit?
When comparing loans for individuals with excellent credit, it's crucial to consider the interest rates, fees, repayment terms and loan features. Utilizing online comparison tools and obtaining personalized quotes from multiple lenders can help borrowers find the most favorable loan terms tailored to their specific needs.
What are the most common mistakes you see borrowers make when taking out a personal loan with excellent credit?
One common mistake borrowers with excellent credit make when taking out a personal loan is not thoroughly researching the loan terms or blindly accepting the first offer they receive. It's important to shop around, compare rates, read the fine print, and understand all fees involved to ensure they are getting the best deal. You should get at least 3-5 quotes before making a decision.
What factors should borrowers consider when calculating their monthly payments on a personal loan?
When calculating monthly payments on a personal loan, borrowers should consider the loan amount, interest rate and loan term. Using online calculators or consulting with lenders can help borrowers determine how these factors impact their monthly payments and overall affordability.
Are there any advantages or disadvantages of taking out a large personal loan with an excellent credit rating?
Taking out a large personal loan with an excellent credit rating can have advantages such as accessing higher loan amounts and securing lower interest rates. However, borrowers should carefully assess their repayment ability and consider potential disadvantages, such as the risk of overborrowing or taking on a higher debt burden, before committing to a large loan.
https://www.moneygeek.com/credit-cards/travel/#expert=ross-loehr
Who is best suited for a travel rewards credit card and how can consumers determine if a travel card is right for them?
A travel rewards credit card is best suited for people who travel frequently and want to earn rewards for their travel-related expenses. Consumers can determine if a travel card is right for them by considering their travel habits or goals and expenses. This includes things such as how often they travel, where they typically stay, and how much they spend on travel-related purchases. If they travel frequently and spend a significant amount on flights, hotels and other travel-related expenses, a travel rewards credit card may be a good option.
What factors should consumers consider when searching for and comparing travel credit cards?
When comparing travel credit cards, consumers should consider some of the following factors:
-
Rewards program: Look for a card that offers rewards that fit your travel needs or goals and spending habits. This includes rewards such as airline miles, hotel points or cash back on travel purchases.
-
Annual fees: Some travel credit cards may come with annual fees, so consider whether the rewards and benefits justify the cost. Foreign transaction fees: If you plan to use your credit card internationally, look for a card that doesn't charge foreign transaction fees.
-
Sign-up bonuses: Many travel credit cards offer sign-up bonuses, so consider whether the bonus is worth the required spending to earn it. Many travel credit cards offer increased bonuses throughout the year, so keep an eye out for these.
-
Travel benefits: Some travel credit cards offer additional travel benefits, such as airport lounge access, travel insurance and free checked bags. Depending on your home airport or favorite destinations, this can make a big difference in which card is right for you.
What common mistakes do people make when it comes to choosing and using a travel credit card?
The most common mistakes people make when choosing and using a travel credit card include the following:
-
Signing up for a card with high annual fees they can't justify or afford
-
Not fully understanding the rewards program or how to earn and redeem rewards
-
Using the card for purchases that don't earn rewards or overspending to earn rewards
-
Not paying off the balance in full each month, resulting in high interest charges and debt
-
Not taking advantage of travel benefits, such as airport lounge access or travel insurance
https://www.moneygeek.com/credit-cards/college-students/#expert=ross-loehr
Many students are not educated on credit card use, managing spending and debt. What tips do you have for new credit card holders or parents looking to teach their students how to properly use a credit card?
It's important for new credit card holders to understand that credit cards can be a powerful financial tool, but they can also lead to significant debt if not used responsibly. Here are four tips to help new credit card users manage their spending and debt:
-
Set a budget: Before using your credit card, create a budget that includes all of your necessary expenses and monthly payments. This will help you avoid overspending and accumulating debt that you can't afford to pay off.
-
Pay your balance in full: Try to pay off your credit card balance in full each month to avoid accumulating interest charges. If you can't pay off your balance in full, make sure to pay more than the minimum payment to reduce the amount of interest you'll owe. Monitor your credit score: Your credit score is important when it comes to applying for loans, renting apartments and even getting a job. Regularly monitor your credit score to ensure that it's accurate and that you're taking steps to improve it.
-
Avoid impulse purchases: It's easy to overspend when you have a credit card, but try to resist the urge to make impulse purchases that you can't afford.
International or immigrant students and DACA recipients may face barriers when applying for a credit card in the U.S. What should they expect when applying for a student credit card and what can they do to increase their chances of approval?
International or immigrant students and DACA recipients may face additional challenges when applying for a credit card in the US. Here are three things these students should consider and tips to increase their chances of approval:
-
Limited credit history: International or immigrant students and DACA recipients may have a limited credit history, making it difficult to qualify for a credit card. Consider applying for a secured credit card, which requires a security deposit but can help build a credit history.
-
Additional documentation: When applying for a credit card, be prepared to provide additional documentation, such as a social security number and/or passport. You may also need to provide proof of income or residency as well.
-
Get a co-signer: If you're having trouble getting approved for a credit card on your own, consider asking a family member or friend with good credit to co-sign your application.
What are the most important factors a student should consider when comparing credit cards?
While the five factors below are important for anyone when comparing a credit card, they can be even more so for students since many are just starting their experience with credit cards.
-
Interest rate: The interest rate, also known as the annual percentage rate (APR), is the amount of interest you'll owe on any unpaid balances. Look for a credit card with a low APR to avoid accumulating too much debt.
-
Rewards program: Some credit cards offer rewards programs, such as cash back or points for purchases. Consider your spending habits and choose a rewards program that fits your goals and lifestyle.
-
Fees: Credit cards may come with fees, such as annual fees, late payment fees or balance transfer fees. Look for a credit card with low or no fees to avoid paying unnecessary charges.
-
Credit limit: Your credit limit is the maximum amount you can charge to your credit card. Choose a credit card with a credit limit that aligns with your budget and spending habits.
-
Customer service: Consider the customer service and support offered by the credit card company. Look for a company with good customer reviews and helpful resources, such as online account management tools or fraud protection services.
https://www.moneygeek.com/insurance/life/estate-planning-and-life-insurance/#expert=ross-loehr
Why is life insurance an important component to estate planning?
Life Insurance policies offer multiple benefits. These include tax-advantaged death benefits, diversification, guarantees, and liquidity for the beneficiary. It always makes sense to look at your personal situation and discuss your needs with your financial advisor to insure that these benefits fit into your financial goals.
How can you maximize the use of life insurance in estate planning?
The benefits of life insurance completely depend on your personal situation. A trusted advisor is key in determining what makes sense for your situation. Whether your goal is to cover your estate taxes, your final expenses, business ownership transition, avoid probate, pass money tax-free, or a host of other goals, life insurance can help you meet these goals. While life insurance may be overlooked by many advisors, it offers a wide range of benefits for those who are looking to maximize benefits for their heirs upon their passing.
When is the right time to use an irrevocable life insurance trust?
An irrevocable life insurance trust or "ILIT" gives the insured a level of control that most life insurance policies do not. If your goal is to control the eventual outcome of a life insurance policy upon your passing, this is one of the best tools to do so. The specifics can be quite complex and depend on your personal goals and a skilled advisor is best positioned to help you in structuring these trusts to achieve your goals.
https://www.moneygeek.com/credit-cards/advice/credit-cards-vs-debit-cards/#expert=ross-loehr
Is it better to have debit or credit? Why?
I believe that if you have to choose one, a credit card is the best choice. There are so many options to get paid back or rewarded for spending that you will be doing anyways. Competition is fierce between the card issuing banks and that means consumers can get cash back, points or miles that can be worth thousands of dollars per year, particularly if you take advantage of valuable credit card sign-up bonuses. The key to success — and I can’t stress this enough — is to make sure you always pay the card on time and do not carry a balance. Otherwise, the benefits that you earn will disappear.
How can consumers strike a balance between using a debit and credit card?
These days almost everyone accepts credit cards. Given the rewards that credit cards provide, it makes sense to use them for spending whenever possible. For those people that have problems with their spending habits, it makes sense to pay the credit card off more frequently. I generally pay all mine off once per week to make sure I stay current. I have a good friend who goes as far as paying his credit card off daily to ensure that it pulls from his bank account like a debit card while he still benefits from the cashback of the credit card. For those who don’t trust themselves with a credit card, this is a great way to strike a balance.
https://www.moneygeek.com/financial-planning/income-streams-in-retirement/#expert=ross-loehr
If an older adult was not able to save heavily before retirement, what’s the first tip you recommend for earning income in retirement?
First off, you are not alone! Many people feel like they need to save more for retirement. Older adults may have more anxiety if they feel their income-earning opportunities are behind them. Luckily, there are more options than ever before to make extra income. Gig opportunities are widespread and a great way to choose your own hours while earning extra income. Many of these jobs allow you to work from home.
Many employers are understaffed and offer part-time work options if you are looking for a more traditional employment opportunity. While having a specific skillset in demand is always a plus, many employers will value an older adult's experience and worldview.
Opportunities to earn income in retirement are greater than they have ever been. Remember, you bring experience, reliability, and motivation to succeed, which are skills employers are looking for regardless of age!
How do you recommend an older adult calculates their life expectancy when financially planning for retirement?
It generally makes sense to plan for a longer life expectancy when financially planning for retirement. It is much better to plan for an extended life and not attain it than to plan for a shorter life and run out of money. This more conservative approach will give you a better chance of having the resources to support yourself throughout your golden years.
While you have to consider personal and family health during the planning process, this conservative method provides a buffer that can provide peace of mind to help you better enjoy your retirement.
Geoffrey Hill
CEO & Principal Advisor at Raisonné & Hammer Price Corporation
https://www.moneygeek.com/insurance/health/best-health-insurance/#expert=geoffrey-hill
How do I know whether an HMO, PPO or another type of plan is best for me?
An HMO, or Health Maintenance Organization, tends to be known as a way to save on costs with less flexibility in accessing more specialists, etc. However, in reality, an HMO can help with having a streamlined health plan that allows both the client and the providers to be on the same page in a more systematic way. In other words, just about everyone involved has the objective of trying to help with what can be done preventively, cultivating and reactively to keep the client-patient from having to be hospitalized, which is where major expenses can arise. Obviously, within reason, if the hospital is appropriate, no one will stop it. Still, the objective is to try and do what can be done to stay healthy enough to avoid that, if possible, hopefully. Personally, I never feel I’m offering something less than if I recommend an HMO.
PPOs or Preferred Provider Organization plans often come up at the client’s request, and I can’t think of a time that I have ever tried to persuade a client to consider an HMO instead of a PPO. If the client is focused on having more freedom to see specialists without waiting on a referral from their primary doctor, then that becomes the main priority, and if the client has the budget, then that is the highest priority: access to the doctors they want when they want them within reason.
EPOs, or Exclusive Provider Organizations, are not as common, but they mix HMOs and PPOs. When an EPO is involved, it tends to be more of a default choice without as many decisions to make. Same thing; in general, an EPO is great in most cases.
What type of person is best suited to buying a Health Savings Account (HSA) plan?
When it comes to HSAs or Health Savings Accounts, I have helped clients with them in an unsolicited way when they ask for them; however, I don’t think I have ever recommended an HSA to a client. In my opinion I don’t feel comfortable steering a client in this direction because it can come across as a way for large employers to save money instead of being fully beneficial to the clients or employees as a whole in an aggregate way. It is somewhat of a variance from what insurance is and becomes a mix of self-insurance in some ways.
I believe that there should be more of a distinctive difference between health insurance and being self-insured. However, there are clients who fully understand that they will have a higher deductible (out-of-pocket costs if something happens) for a lower premium, and if that's what they want, it's an option. I don't recommend day-trading stocks, but clients can do it. I have spoken to HSA policyholders with children, and when the child is hurt or when they are hurt, there is a pause in whether or not they should go and get it checked out because of the structure of the HSA.
That goes against everything I'm trying to do as an expansive planner, which is helping clients plan much deeper than just finances. But again, an HSA can be a perfect fit for the right client; I just think it should be unsolicited and rare. I have worked for companies in the past that were obviously overtly trying to get all of their employees to switch to HSA's, which in some ways was also a conflict of interest to get money invested in company mutual funds, etc. It's just not a road I ever went down, and I don't plan to.
How can I be sure my health insurance plan is from a reputable provider with great service?
I am appointed, certified, and licensed with approximately ten different major Health Insurance companies, and I have not had any issues with any of them in terms of being disreputable. There are challenges, and it is a very complex industry; however, big issues come up when clients try to buy alternatives to traditional health insurance, in my experience.
https://www.moneygeek.com/insurance/health/average-cost-of-health-insurance/#expert=geoffrey-hill
What are the most important factors affecting the cost of my health insurance?
Sometimes, the monthly premium cost has more to do with society as a whole and is often outside of your control. However, there are ways to choose health insurance companies that specialize in lower costs, which may mean having a smaller network of doctors and a smaller customer service department. Being healthy is obviously going to keep your out-of-pocket costs lower, so prevention and lifestyle are major factors, even though they may not affect your monthly costs other than smoking.
These are all broad generalizations. Every company, every plan, every region and every client is different, and you want to be speaking to a professional financial advisor who understands more than just asset allocation. Health insurance is sometimes the most important part of financial planning.
Even in professional financial planning, there is a general misunderstanding of what insurance is. An insurance company cannot be expected to lose money each year and stay open to paying for everyone’s health no matter what; that’s not an insurance company; that’s social insurance or government insurance. Social insurance cannot be expected to pay for everyone’s health, no matter what, unless society votes for 67% taxes, like Denmark. It’s a subject that gets oversimplified by politicians, Bush League news and Bush League financial ‘advisors’. Insurance planning requires context, cultivation, depth and customization. You want to work with a reputable advisor with a reputable track record and history.
https://www.moneygeek.com/insurance/health/most-affordable-health-insurance/#expert=geoffrey-hill
What are the pros and cons of buying health insurance plans with cheaper premiums?
It's similar to choosing when you should start taking your Social Security income. You don't know how long you will live but you can still make an intelligent choice and an intelligent estimate based on self-awareness and projections, etc. If you're very healthy and expect to have a long life expectancy then waiting will likely be more lucrative. If you're in good health when choosing health insurance, the lower premium, for the time being, may be a better fit. The premiums have an inverse relationship with other out-of-pocket costs for using the healthcare services. So a low premium normally means a higher deductible and higher co-insurance if you have an unexpected visit to the hospital etc. However, you can also buy affordable, supplemental policies to also cover those emergencies which can still save you money overall. If you're not in great health, or if your family history has had many health challenges, then you may wind up being better off with a higher premium since it will normally include better overall coverage and lower deductibles, lower coinsurance, etc. It does not always work out in those simple terms, but in general, that's a good starting point when deciding. Some Medicare Plans not only have cheaper premiums, some actually credit you money back each month to cover other costs. These plans are mainly for people that feel as though they are in good health. One major factor to be careful of is that if you don't get a higher premium Medicare plan right when you become eligible (during that brief window), you may not qualify for one of the higher premium plans later if you become unhealthy. They have to approve you as a Guaranteed Issue when you are first eligible for Medicare, but after that, they can deny you coverage for that particular higher premium - a better coverage plan. With Health Insurance, peace of mind for you and your family also has to be factored in. Health Insurance should really be called Life Insurance and Life Insurance should really be called Death Insurance. They are misnomers. Health Insurance is all about your Life and Living it Well.
If I’m not eligible for Medicaid or Medicare, what other options are there for cheap health insurance coverage?
In order to get cheap health insurance outside of Medicaid and Medicare, you mainly need to qualify for a government subsidy through an ACA (Affordable Care Act) plan (Marketplace / ObamaCare). They are all synonyms for the same thing. Choosing Health Insurance is actually more complex and more customized than choosing an Investment Strategy and it's something that is definitely worth going through a professional advisor. You rarely ever have to pay the advisor anything for spending hours helping you and for helping down the road as well. The advisor gets paid by the Health Insurance company and some Advisors are licensed with dozens of companies to choose the right one with your doctors, etc.
Can I still get quality coverage if I buy a cheap health insurance plan?
Yes, but if you're too young for Medicare, then it's not likely unless you are in a situation where you are needing some financial assistance due to various circumstances that life may, unfortunately, throw at you. Many Medicare plans are very affordable with high-quality coverage. Medicare can also be very confusing and you again will likely want to take advantage of speaking with an advisor for free. Cheap is not a word that the Health Insurance companies would want you to use which is fair and accurate. Insurance is not cheap, it's either affordable or expensive, it won't break, it's not plastic. It's a written financial contract that you want to speak with an experienced financial professional about. Lack of Health Insurance is the #1 cause of bankruptcies and when you speak with thousands of different clients, you see in real life the large number of people that suddenly have cancer, suddenly have a stroke out of nowhere. It's real and you want to be properly financially prepared. Preparedness is the Prime function of both Financial Planning and Expansive Planning which includes Insurance Planning, Economics, etc.
https://www.moneygeek.com/insurance/life/best/seniors/#expert=geoffrey-hill
How can seniors determine what type of life insurance policy is the best fit for them?
It's important to review your goals when purchasing a life insurance policy. It will generally be much different for a senior than it would be for a newlywed or parents with young children. Talk with your financial advisor and discuss your overall goals. Consider how your other assets will help you achieve this, and use life insurance as a tool to help you achieve your objectives.
Why might the best type of life insurance policy be different for older seniors versus younger seniors?
Life insurance policy costs and terms are generally higher and more stringent for older seniors versus younger seniors. Older seniors, particularly those interested in working in their retirement years, may consider taking a job offering a group life insurance benefit to employees. This benefit alone could offer much value for a senior looking to add more life insurance. This strategy will help supplement the cost of the life insurance benefit.
