2C • OCT. 20, 2023
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Dave Says: Eventually, you become self-insured
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BY DAVE RAMSEY, CEO, Ramsey Solutions, and an eight-time No. 1 national best-selling author, and host of The Ramsey Show
ear Dave, My wife and I are both 36 years old, and we have two children. Our son is six, and our daughter will be four next month. We’ve been walking through the Baby Steps, and we should have our home paid off sometime next summer. We realized the other day the one thing missing from our financial picture is life insurance. We both work outside the home. She makes $60,000 a year, while I make
$80,000 a year. At our age, and in our current situation, do you think we should we get 20-year or 30-year level term life insurance policies? Clay Dear Clay, You guys are doing a great job of getting control of your finances and planning for the future. Speaking of the future, do you plan on having more kids? If you do, you might want to go with 30year policies. If you’ve decided two are enough, then
based on your present situation I think 20-year policies would work out fine. I recommend folks have 10 to 12 times their annual income in life insurance coverage. That means you’d need between $800,000 and $960,000 in coverage, while your wife needs a policy in the $600,000 to $720,000 range. But let’s take a deeper dive into all this. Your kids will be in their mid-twenties in 20 years. Ideally, they both should
have finished college by that time, or at the very least, be working and living on their own. If you continue to follow my plan, you and your wife will have paid off your home in a few months and be completely debt-free. And, you’ll have been saving 15% of your income for retirement over those 20 years. On average, that alone should give you more than a half-million dollars for retirement. Do you see where I’m
going with this, Clay? Eventually, you two will become self-insured by getting out of debt, staying out of debt and piling up cash. So, if you’ve got $500,000 or more in a retirement fund, no debt and your children are grown and out of the house, even if you or your wife were to die unexpectedly at that point, the other would still be taken care of and in great shape financially. Keep up the good work! —Dave
Stock Market Insights: Investing in turbulent times – Israel’s 9/11
DR. RICHARD BAKER, AIF®, is the founder of and an executive wealth advisor at Fervent Wealth Management. https://www. facebook.com/Dr.RichardBaker
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hey aren’t training; those jets are armed.” Several years ago, four low-flying jets came out of nowhere while I was climb-
ing a hill in southern Israel. I assumed they were training, but my Israeli friends told me that because Israel is surrounded by enemies, its military is always on high alert. I am praying for those affected by the unprovoked and horrific attacks against Israel in the past few days. This attack seems to be Israel’s 9/11. Nothing is as important as the loss of human life, but there are stock market implications that need addressing. Stocks fell early in the morning the first day the
market was open after the attacks but shook off the fears and rebounded later in the day for a daily gain. The most affected were crude oil prices, defense contractors and gold. Oil went up 4% initially but fell later; however, the stocks of defense contractors are 5-10% more than before the attack. Gold, a popular investment in times of world conflict, rose only by 1%. Interestingly, oil and gold are lower now than a month ago, which shows the limited impact of the conflict so far. Most of the stock mar-
ket hasn’t been affected by the attack on Israel, but that could change if the Israel-Hamas war grows into a larger multinational war. Something like this could strain oil flow out of the Middle East, which provides a third of the world’s oil supply. The worst-case scenario would be if Iran were to get more directly involved and declare war on Israel. This could lead to rising oil prices because of the threat that Iran would restrict tankers coming out of Iraq. This is because the Per-
sian Gulf, where 20-30% of the world’s oil supply is shipped, narrows to only 21 miles wide at the Strait of Hormuz on the shores of Iran. I would adjust my portfolios to add more oil stocks, defense stocks, and Treasurys if there were an actual Iran-Israel war. Historically, attacks on Israel haven’t moved the stock market much, and any initial market reactions are often reversed in a few days. Except for the 1973-74 Yom Kippur War, which led to the oil embargo, the IranIraq war in 1979, and Iraq’s
invasion of Kuwait in 1990. Though barbaric, this latest attack on Israel isn’t likely to cause harm to long-term investors. An investment portfolio’s longterm performance depends more on economics than geopolitical conflicts. Investing in times like these must be done strategically and without emotion. Don’t get caught up in the emotions of the headlines. Instead, stick to your financial plan and stay focused on your goals. Have a blessed week! www.FerventWM.com
Medicare Open Enrollment is an opportunity to choose a plan that best meets your needs Mo.gov MO SHIP provides free assistance during Medicare Open Enrollment through Dec. 7 The Missouri Department of Commerce and Insurance (DCI) encourages those eligible for Medicare to review their plan options and costs during this year’s open enrollment period. From October 15 through December 7, Missourians can change their Part D drug coverage or Medicare Advantage plans. To help with that choice, the department offers free
assistance to those eligible for Medicare and their caregivers through Missouri’s State Health Insurance Assistance Program – now known as Missouri SHIP or MO SHIP after a rebrand earlier this year from the CLAIM program. MO SHIP also helps Missourians on a limited income determine whether they qualify for a Low-Income Subsidy and Medicare Savings Programs to offset the cost of their prescription drugs. “Consider taking advantage of MO SHIP’s assis-
tance during Medicare Open Enrollment,” said Chlora Lindley-Myers, Director of the Missouri Department of Commerce and Insurance. “Plans and a person’s circumstances can change year to year, and what has been previously selected may not be the best fit for your needs now.” Medicare Open Enrollment also causes a spike in deceptive sales tactics via commercials, online, or even personal phone calls – which can further increase confusion among
seniors and healthcare providers. One of the best ways to protect yourself against healthcare fraud and abuse is by never sharing personal information with strangers, especially your Medicare or Social Security numbers. “MO SHIP counselors are eager to help Missourians explore all options to save money on Part D and Medicare Advantage plans for 2024,” said Scott Miniea, Executive Director of MO SHIP. “Last year, the average savings per consumer was $2,000, with 98
percent of clients seeking our assistance every year in addition to also referring their friends and family. We are here to help find the best plan option for your specific needs.” Medicare open enrollment is October 15 through December 7 annually. Missourians can seek free and unbiased assistance from MO SHIP throughout the year by phone or arrange one-on-one counseling by calling 1-800-390-3330 or visiting missouriship.org. MO SHIP is funded
through a grant from the Administration for Community Living (ACL). Funding is administered through DCI and service is provided by Missouri Connections for Health, a nonprofit organization. DCI is charged with protecting Missouri consumers through oversight of the insurance industry, banks, credit unions, utilities, and various professional licensees operating in the state. For more information about the department, please visit our website at dci.mo.gov.
