Tag Archives: HIgh Deductible

Back to the Basics: Fun New Complete Financial Planning Series/Course, Part 2 : Protection Planning …

Welcome to Part Two of our fun educational “Back to Basics” series original started here with Part One “The Emergency Fund” and continuing with this part, Protection Planning!

The goal of this series is to cover the most important Foundational Financial Planning items in not only order of importance but also order of technical difficulty. Once complete we expect to have a foundational, almost college like course of Financial Planning topics and goals that can be shared all at once in Netflix series drop like format for any that may be in need or interested. Longtime clients will most certainly find a repetition of items we have spoken or written about before but may occasionally uncover a topic that needs addressing due to a change in our situation.

Protection Planning – Health, Home/Auto (PLUP – Umbrella), Life

We could easily spend hours on each of these topics but in order to cover as much ground as possible we’re going to have a high-level discussion that fits neatly in our series as you will see that we will immediately refer back to Part One. “The Emergency Fund” as it affects our Protection Planning.

The following are in order of importance:

Health Insurance:

Never go a day without it as one accident could be devastating to your net worth!

Those of us lucky enough to have a large employer you probably have the best coverage at the most reasonable price. On that note if as we have mentioned in Part One “The Emergency Fund” you have a healthy one and you do not have any chronic or pending health conditions, it may be worth looking at a high deductible type of plan.

Those self-employed, it is a struggle, we understand, and your coverage will likely not be as good and cost more. Again, depending on your situation, a high deductible plan may work well for you. One of our favorite tricks for the self-employed is to try and have coverage via your industry of specialization. As an example, if you are a producer or pilot, you may have special insurance coverage through an organization, we find that specialty organizations offer the most reasonable prices and the most comprehensive coverage.

Home and Auto and Umbrella Protection:

When dealing with your home protection, again never go a day without coverage!

This may seem logical, but loss or lack of coverage can sometimes accidentally occur if you have no mortgage on your residence. If you do have a liability against your home the bank or financial institution will mandate you have good coverage at all times showing the importance of coverage. With our good emergency fund, we like high deductible plans as over the long term they will generally pay for themselves in the savings of premiums.

On our auto insurance, you guessed it we like a high deductible plan and in certain situations once the car is of extreme age it may be worth looking at dropping full coverage as it is easy for our annual premium to more than pay for what the residual insurance coverage would pay should your car be totaled. This situation changes and takes some continued monitoring.

The PLUP or Umbrellas policy is one additional insurance that is tied to our home/residence and auto and is a personal liability umbrella policy which we like anyone that could be seen as a target for whatever reason from bad guys out there that may want to sue us for whatever reason. Umbrella policies are relatively inexpensive and have the good effect of making sure your other coverages are comprehensive enough before the umbrella policy is established

Life Insurance:

The need for life insurance grows as your liabilities increase especially with the primary breadwinner of the family.

Liabilities could include business loans, large mortgages, children or other dependents, or another outside solvency that needs to be replaced should you pass away. As a person or family’s net worth grows there can be an inflection point where there is less of a need for life insurance. Long term life insurance needs can vary on a very personal basis. With various types of life insurance is there are possibilities for very large policies at very reasonable amounts given the specific circumstance.

It is almost impossible to cover every aspect of each of these topics and as such this is not exhaustive, but we think very helpful!

Have a Great “Back to Basics, Protection Planning” Day!

John A. Kvale CFA, CFP

Founder of J.K. Financial, Inc.

A Dallas Texas based fee only

Financial Planning Total Wealth

Management firm.



Q 4 2018 Newsletter Video Audio Podcast Review By John Kvale

Welcome to our Video and Audio Podcast Review of our Q 4 2018 Newsletter. For those on the road or just unable to grab the time to read, our podcast type review gives you the behind the scenes insight to our thoughts, observations and deep views of the entire Newsletter.

Click Here for direct link to an electronic version (an early peek-good ole fashion paper versions are on their way to you shortly) and here for our Newsletter page

BREAK IN – Save the date for the Holiday Party

November 17th – Saturday before Thanksgiving – Dallas Athletic Club from 3-5 pm


Let’s get going!

Q 4 2018 Newsletter

And here is your review!

Capital Market Talk

Earnings and Markets Eventually Converge

In this hugely in depth article, first we discuss the effect of earnings eventually driving capital markets, but disconnects can occur. It can even be a good thing for Capital Markets to WAY underperform earnings, as they are this year because in brings valuations back in line.

Here is the key graph

7-13-18 EPS Growth and Mkt Growth 10 year avg

Higher Rates, a Short Term Headwind, Eventually a Tailwind

With sustained lower rates over the last decade, memories have faded on the tugging headwinds that higher rates have – IN THE SHORT TERM – on the mandatory safety asset class of bonds.

Higher rates are a great thing as Bonds/Fixed Income Assets have a place for almost all investors due to their safety and liquidity.

Once the headwinds subside our fixed income investments will have ridden the yield curve higher and begin paying more income in the form of yield – into our pockets – Finally!
bond index V Interest Rates

Too High of Rates Can Create Trouble

Too high of rates or an overshoot CAN create trouble … or a recession…

Our friends at JPMorgan – historically show that rate is about 5% – yea FIVE percent –

We disagree and think a lower level may now be this tipping point, due to the decade low interest rate level we have just experienced-

Current at two percent, we have a long way to go before getting too antsy
JPMorgan Rate Level for Slowdown

Inverted Yield Curve Update

So far to good- no inversion yet!
9-28-18 90 day to 10 year Inverted Curve status

Financial Planning

This series of articles came out of no where and in like domino fashion, once one was done the next took form and fell into place-

PLUP graph

App of the Quarter – Hardware

Our editor took the fancy picture out due to copyright fears, but our experience with the Firestick has been exceptional – Here are the highlights of our findings

  • Great Savings compared to just full service in many cases
  • Does not take as much internet speed as we thought
  • Bring your home on the road
  • Multiple devices used at once
  • Cuts back on duplicated services
  • Allows cherry picking services

Enjoy the fall –

See Ya next Year – Wow 2019 here we come!

John A. Kvale CFA, CFP

Founder of J.K. Financial, Inc.
A Dallas Texas based fee only
Financial Planning Total Wealth
Management firm.

Why we like High Deductibles!

As we worked on our PLUP – Personal Liability Umbrella Policy Newsletter and Blog Post, we repeatedly ran across reasons to discuss our fondness to the Higher Deductible options on almost everything.

This article has also spawned a related article, about Emergency funds – neat chain of events articles!

Consider the High Deductible Option – On Most Everything

Health Insurance, Auto Insurance and Homeowners are the main types of ongoing insurance that allows you more control in your cost via the deductible.

The Auto Insurance Examplecrash-test-1620591__480

One of the easiest examples is the good old automobile insurance. We like high deductibles of near one thousand dollars due to the tremendous longer term premium savings that will occur over time. We certainly acknowledge that changing your coverage deductible to a higher amount today and having an accident tomorrow is bad luck and will throw you into the hole, but over time, if you are not a repeat offender, your saved premiums will more than pay for the higher deductible.

Health Insurance Example

Let’s face it, the insurance industry wants us as consumers to take more control over our medical expenses. Rather than run, embrace this coming inevitable change, and review higher deductible health insurance plans. Similar to the Auto example, if you opt for a higher deductible plan and something happens in the very short term, you will be in the hole on this decision, however time is your friend.  Having your health coverage pay for that visit to the Dr. for a cold is nice, and may make you feel good after you leave the office, however if you dig deeper, it is likely you may be paying dearly for the “free” visit.

Homeowners Insurance Deductible

Yep, there is a higher deductible option for your homeowners policy as well. This option is usually in the form of a percent of the dwelling. Be careful when reviewing these options as our experience has shown premiums and out of pocket costs can vary greatly depending on the geographic area of your dwelling and a higher percentage deductible can get out of hand if you are not careful on a higher priced dwelling. Bottom line, the homeowners policy has more moving parts due to the differences in coverages, geographic area, dwelling itself and your claim history. Take extra time in adjusting this deductible, but once you get clear on all costs, obligations and options, it’s likely you will find savings in this as well.

Have a Great “High Deductible Savings” Day!

John A. Kvale CFA, CFP

Founder of J.K. Financial, Inc.
A Dallas Texas based fee only
Financial Planning Total Wealth
Management firm.

Mother Nature FLEXES her Muscles – High Deductible Pre-View – Friday

With a crew that absolutely loves the outdoors – beach, mountain, desert … heck they might even like a rainforest (never been with the whole gang.) Mother Nature has an influence on our lives.

Mother Nature FlexesHurricane -tropical-cyclone-63124__480

We wish the best for those in the mighty Mother’s path. With the most visible storm making landfall to our friends on the mid eastern coast line, and one of our far west states/islands are also dealing with her muscle flexing….

Safe wishes to all!

High Deductible Preview

Next week we continue our found series (PLUP, Emergency Fund-) with the last depending part, the High Deductible. Thanks for all the responses, we have greatly enjoyed sharing and will have full versions in the coming Q4 Newsletter.

Of course it’s a Tennis weekend, but long time followers will be surprised to know this weekend unusually includes little Brother in a Sunday match while older sister watches and gives important advice…..

Today is a Friday, enjoy your day and the weekend .. be safe and talk to you next week!

John A. Kvale CFA, CFP

Founder of J.K. Financial, Inc.
A Dallas Texas based fee only
Financial Planning Total Wealth
Management firm.

The HSA – Health Savings Account – If you can, fund it !

This week we bring you another tax strategy that may save you extra dollars, while not mandatory before the end of the year – we find it MUCH less confusing to synch the year – make the deposit in the year of the deduction.

Recently in our end of the year tax strategies, we visited Pushing Income , Optimizing Donations, the week prior of IRA Distribution, and the week prior to that a Roth Conversion  to maximize your tax deductions. This weeks topic is simple, the HSA ! HSA

If you have a “High Deductible” health insurance plan – many more do recently, to smartly save on monthly premiums – if you can fund an HSA – DO SO NOW! 


Here are the limits from our friends at HSA Bank – (one of our favorite HSA investment options- there are many):

HSA 15 - 16 Limits HSA Bank


  • Age 55 – Not 50 for catch up increases
  • Almost without regard to investment, the tax savings are worth it
  • Pre-tax savings for future use or today
  • Pre-tax payments for today or tomorrow

These are just a few examples!

While we do not offer HSA savings plans, they are worth the time and effort to set up, the tax savings are terrific!

Any questions– just reach out- we will be glad to help!

Have a Great — Less Taxable — Day!

John A. Kvale CFA, CFP

8222 Douglas Ave # 590
Dallas, TX 75225