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 Example
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
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
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
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!
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
Inverted Yield Curve Update
So far to good- no inversion yet!
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-
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
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.
www.jkfinancialinc.com
www.street-cents.com
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Tagged Bonds, Earnings, Firestick, HIgh Deductible, Inverted Yield Curve, Plup, Rates, Roku, S