Happy New Year from Legacy Insurance Agency!
Money, Politics and What To Do
I hope you’ve had an amazing and Happy New Year!
So I wanted to write this post to encourage you, and to follow-up on some of the posts I’ve made online and in blogs recently…
As expected when speaking about politics and money, I’ve definitely struck a nerve.
In fact, I was surprised more than anything, by the amount of POSITIVE feedback I’ve received. BUT, most people are so scared of “offending” someone that they won’t even comment or share my posts.
I’m also disappointed that so many people still don’t “get it”.
Here’s what is happening with your tax dollars in a nutshell…
On Dec. 16, Congress passed the BLOATED $1.1 TRILLION, Omnibus Consolidated Appropriations Act of 2016. Here’s where it gets tricky, it has to do with U.S. farm and food policy? And, it could affect every farmer, rancher, and consumer in the country.
A short provision tucked into the 2,009-page government spending bill will remove labels telling consumers where their beef and pork comes from, meaning your meat could be slaughtered here, shipped to China and returned.
Lawmakers and food safety advocates warn that the one simple measure highlights how looming trade deals can undermine U.S. laws. Of course it’s about money… The WTO said Canada and Mexico were entitled to levy $1 Billion in retaliatory tariffs on U.S. exports coming into their markets.
Leave it to them to sneak any policy idea or change into some must-pass, end of the session, catch-all budget bill one week before Christmas. And, then call it “the best deal you could get given the time constraints all were under.”
Last-minute deals aren’t lawmaking. This was a backroom deal where Senate and House negotiators bent to satisfy Big Money and the Washington machine that tramples the will of the American people.
And, while you were distracted, Congress shook up the student loan market with yet another spending deal. President Barack Obama signed into law a plan directing the Education Department to treat its largest and smallest loan contractors equally. The measure supposedly helps some 42 million Americans become less likely to fall behind on their student loans, and get better customer service.
“This provision is a win for student loan borrowers, ensuring that they receive effective, personalized loan servicing that guides them through their repayment period successfully, and for taxpayers, who deserve a system that maximizes existing and proven resources,” Debra Chromy, president of the Education Finance Council, a Washington trade association, said in a statement.
According to the Federal Reserve, total student debt, including private loans, has doubled since 2008 to about $1.3 TRILLION. Now, Americans collectively owe more in student loan debt than they owe on their credit cards or auto loans. making student debt the second-largest source of household debt after home mortgages. The Consumer Financial Protection Bureau estimates that nearly 8 million Americans are in default on their student loans.
If that’s not enough, the future for 2016 doesn’t look bright. The Federal Reserve Bank of Atlanta’s GDPNow just released their dismal 4th quarter GDP forecast. The forecast was nearly cut in half from 1.3% on December 23rd to 0.7% today. And, it remains much worse than the mainstream consensus estimates.
And I don’t have to remind you that we already had a $19 TRILLION annual defecit prior the Omnibus passing. Or that Social Security and Medicare have unfunded liabilities totalling close to $100 TRILLION!!!
But hey, it’s the new year, so let’s talk about something other than politics. What I want you to understand is that the government wants your money. And, they will do their best to tax, fine or steal it from you if it’s left unattended.
So… What can you do? You’ve heard me say it before, protect it and put it to work. You see, you have the power to take control of your finances. And, what I’m advocating is that you invest in yourself.
As I write this, the stock markets are in a tailspin. China actually had to close their markets due to a more than 7% loss on Monday. Yet, this is where all of the “financial gurus” are telling you to “invest” your money. Sure, there are some deals to be made, but they don’t necessarily have to be stocks.
Stocks are nothing more than buying into someone else’s dream. The problem is, we CAN NOT control that. That’s why I recommend to my clients that you ONLY purchase stocks after you’ve shored up your financial house. Yet, millions of Americans blindly “invest” their hard earned money in someone elses idea of reality.
Whatever happened to good old fashioned “saving”? When our Grandparents were around they saved a large portion of their income. Today, we save less than 5%, and the lines have been blurred between saving and investing.
The problem most people is where to save where you can actually earn a return. And, while there are save places to save where you can earn a return, it’s difficult in today’s low interest rate environment.
How can you invest in yourself? Here are 3 simple ways.
1. Education (Read books by success stories)
2. Own permanent life insurance
3. Buy assets that go up in value
And… Repeat
Let’s look at those one by one.
Education – you can easily read a book a month by just reading 10-15 minutes in the morning, evening or both. You can even purchase CD’s to listen to in your car or better yet, download free podcasts. If you do, at the end of 2016 you will have read over 10 books, making you an expert in virtually any field. Again, it’s important that you choose the correct books, so look for biographies and success stories on the topic of your choice.
Here’s my Top 3 Money books to get started:
1. Rich Dad, Poor Dad
2. Think and Grow Rich
3. The Richest Man in Babylon
Permanent Life Insurance – over the years a lot of naysayers have come out saying life insurance is a “bad investment” because you can’t get the returns that you can get in the stock market. Well “DUH”! First off, that’s because life insurance is not an investment in the traditional sense. And, if a few rules are followed, you can’t lose money either…
What PLI does, is give you options and time. You see, we don’t know when our time is coming, so life insurance buys you that time. And, if structured correctly, allows you tax benefits, liquidity and control of your money.
Assets that Appreciate – there are lots of assets that appreciate, and even more that depreciate. Your car is a great example of what most people consider an asset, unfortunately it’s probably lost value since last year. So, what I’m talking about here is something like a business or rental property that creates additional cash-flow. Not a piece of land or even the house you live in, this asset must increase in value or produce income. You can now start a business in your garage or on your laptop with a minimal investment and start earning income immediately.
Ironically, a great way to purchase assets without having to depend on the banks for loans, is with PLI. You can leverage your PLI to give you multiple uses of your dollars. We’ll discuss this in more detail in a different setting.
So, what I must repeat and hopefully you are starting to “get” is this. You are the asset, and you must invest in yourself to get ahead. The government can not solve our problems. All they do is spend our money in the form of taxes and future debt.
There you have it… 3 Ways to Invest in Yourself and have a Happy New Year! Education, Permanent Life Insurance and Assets that Appreciate.
If I can ever help you, your family or friends in any way, just let me know.
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Until next time,
Barry Page
http://legacyinsuranceagency.com
Barry Page is a Registered Financial Consultant, Managing General Agent and Founder of Legacy Insurance Agency, PLLC. He helps clients with tax advantaged investment alternatives and specializes in showing families how to protect their assets, income and lives utilizing a macro-financial approach to planning.