7 Things to Know About Practicing Safe Sun

2 Jul

By Sheryl Smolkin

After a long winter, when summer weather finally comes, all I want to do is close my eyes and bask in its warming rays. It doesn’t seem possible that this is a high risk activity, yet melanoma skin cancer caused by damaging ultraviolet (UV) radiation is one of the fastest rising of all cancers in Canada.

But we all want retire healthy and live to a ripe old age. So the good news is that skin cancer is preventable if you practice “safe sun.” That means correctly applying sunscreen at recommended intervals and wearing protective clothing such as hats and sunglasses. Sunscreens are products combining several ingredients that help prevent the sun’s ultraviolet (UV) radiation from reaching the skin.

Two types of ultraviolet radiation, UVA and UVB, damage the skin, age it prematurely, and increase your risk of skin cancer. UVB is the chief culprit behind sunburn, while UVA rays, which penetrate the skin more deeply, are associated with wrinkling, leathering, sagging, and other light-induced effects of aging (photoaging). They also exacerbate the carcinogenic effects of UVB rays, and increasingly are being seen as a cause of skin cancer on their own. Sunscreens vary in their ability to protect against UVA and UVB.

SPF — or Sun Protection Factor — is a measure of a sunscreen’s ability to prevent UVB from damaging the skin. If it takes 20 minutes for your unprotected skin to start turning red, using an SPF 15 sunscreen theoretically prevents reddening 15 times longer — about five hours.

SPF 15 filters out approximately 93% of all incoming UVB rays. SPF 30 keeps out 97% and SPF 50 keeps out 98%. They may seem like negligible differences, but if you are light-sensitive, or have a history of skin cancer, those extra percentages will make a difference. And as you can see, no sunscreen can block all UV rays.

Here are 7 things you need to know about “practicing safe sun”:

  1. Who should use sunscreen? Everyone regardless of skin tone or ethnicity over age 6 months should use sunscreen. Younger infants should be kept in the shade or wear protective clothing.
  2. Cloudy days: Up to 40% of the sun’s ultraviolet radiation reaches the earth on a completely cloudy day. This often leads to the most serious sunburns, because people spend all day outdoors with no protection from the sun.
  3. Expiration dates: When it comes to sunscreen, expiration dates really do matter. The active ingredients in sunscreen can deteriorate over time, which means the protection won’t be as effective. What’s more, an open bottle is more likely to become contaminated with germs as the preservatives meant to prevent bacteria can also lose their efficacy. Read the suggested expiry date and storage conditions on the label.
  4. Choosing the right sunscreen: The kind of sunscreen you use may vary depending on the type of outdoor exposure you are expecting. For incidental sun exposure — when you are outside only for minutes at a time — an SPF of 15 is probably sufficient. Your sunscreen should have broad spectrum protection, meaning it effectively protects against significant portions of both the UVA and UVB ranges of the light spectrum. Most broad-spectrum formulas contain multiple sunscreen ingredients. For more detailed information on ingredients and how to choose your sunscreen, click here.
  5. SPF in your makeup: A two-in-one foundation/sunscreen certainly seems handy, but that doesn’t mean it works. Part of the problem is quantity: a dab of foundation isn’t the same as the amount of sunscreen you should slather on your face. However, a moisturizer with SPF can do the trick.
  6. How much is enough? To ensure that you get the full SPF of a sunscreen, you need to apply 1 oz. – about a shot glass full. At least four ounces per day with four applications means one 8 ounce bottle will only last the weekend. With 15 weekends between Victoria Day and Labor Day, you’ll need at least 15-8 ounce bottles per family member to get you through the season—even on rainy or cloudy days!
  7. Proper application: Sunscreens should be applied 30 minutes before sun exposure to allow the ingredients to fully bind to the skin. Reapplication of sunscreen is just as important as putting it on in the first place, so reapply the same amount every two hours. Sunscreens should also be reapplied immediately after swimming, toweling off, or sweating a great deal.

You can use both sunscreen and insect repellent to protect your health but be sure to read and follow the instructions on both containers to make sure that each product is applied properly. Health Canada recommends that if you apply both products; put the sunscreen on first, followed by the insect repellent.

Jun 22: Best from the blogosphere

22 Jun

By Sheryl Smolkin

This week marks many milestones in the life of our family — Father’s Day, my husband’s retirement and my 65th birthday (really?). Also our granddaughter and her Moms will be in Toronto to celebrate her 3rd birthday. It seems like just yesterday we drove from the cottage in Muskoka to Ottawa to meet her for the very first time!

We’re planning an informal backyard barbecue for close family and a few friends with a home-made ice cream cake. But the cost of children’s birthday parties can really get out of hand with families striving to “keep up with the Joneses.”

This week we share links to articles and blogs that will help you manage the cost of kid’s birthday parties.

How to throw a great, cheap party for your child has great ideas like make your own pizza parties, pool parties, get crafty instead of buying decorations and sourcing balloons and other party paraphernalia at the dollar store.

On About Parenting, Megan Cooley suggests that you keep down the guest list, forget goody bags in favour of a simple gift related to the party theme like a cookie cutter or seeds for the garden and play traditional party games instead of hiring outside entertainment.

Six years ago, Lindsay Armstrong on babble.com offered 25 birthday party tips that still resonate today. I think throwing a costume party is a great idea. Award prizes for the silliest costume, the most colorful costume, etc. (just make sure that everyone gets a prize). If nothing else, the other parents will appreciate getting some extra use out of last year’s Halloween costume.

My suggestion if you own a photo printer or can borrow one, is to purchase inexpensive 4’ x 6’ frames in advance. Take lots of pictures during the party and print either a group or individual pictures that can be framed and sent home with each child. You can also have the children decorate the frames first using washable paint plus odds and ends they can glue on like shells or buttons.

And finally, how about asking guests to bring a donation to a charity instead of bringing gifts? Help your child select a charity that is meaningful. What does your child care about? It could be animals, the elderly, homelessness or hunger.  Instead of Pin the Tail on the Donkey, movies or kickball, consider an activity specific to the charity of choice. Be sure it is age appropriate and enjoyable for everyone attending.

Do you follow blogs with terrific ideas for saving money that haven’t been mentioned in our weekly “Best from the blogosphere?” Share the information with us on http://wp.me/P1YR2T-JR and your name will be entered in a quarterly draw for a gift card.

Chet Brothers: Brothers and Company named to Financial Wealth Professional Magazine Canada’s 2014 Top 50 Advisers

18 Jun


By Sheryl Smolkin

Click here to listen

Click here to listen

Today I’m interviewing Saskatchewan financial planner Chet Brothers for savewithspp.com. He formed Brothers and Company Financial, an independent planning and wealth management firm in 1994 after spending a number of years at the wealth management subsidiary of a large Canadian financial Institution. He’s experienced in all aspects of personal finance and wealth management.

Brothers has dedicated his professional career to educating the public and financial advisers about the importance of comprehensive financial planning. His professional qualifications include Certified Financial Planner and Registered Financial Planner designations. He also served his profession as past president of the Institute of Advanced Financial Planners and he is currently on the board of the Canadian Institute of Financial Planners.   He came to my attention as Wealth Professional Magazine recently named him one of only two Saskatchewan financial planners on their Canada’s Top 50 Advisers’ list in 2015.

Thank you so much for joining me today Chet.

You’re welcome.

Q. How did you get into the business of financial planning?
A: I started in investment sales and was looking for a career that offered lifetime learning opportunities. So I upgraded and moved into the financial planning area.

Q. How do you think Canadians can benefit from working with a financial planner?
A: I think a financial plan really makes the most efficient use of all the resources that an individual or a family has at hand to enable them to realize the hopes and dreams they have for themselves, their family, and their community.

Q. Are your clients typically close to retirement or do you work with a broad spectrum of clients developing financial plans?
A: I would say if you looked at the bell curve, the peak would be people either five years before or five years after retirement. But we do deal with the entire spectrum. Often as people get closer to retirement, the importance of financial planning becomes clear to them and they seek out advice.

Q. What should people who require financial planning services be looking for? What questions should they be asking?
A: First, I think you want to make sure you are dealing with an accredited person with a professional designation — either the CFP or RFP or hopefully both. You want to make sure that they have some experience. Let them practice on someone else. I started at a large financial institution, essentially apprenticing. They also need to have a defined and tested investment strategy and a comprehensive approach. If someone wants to talk to you just about your investments and hasn’t asked you about your will or your power of attorney, I’d run.

Q. Do you sell products like securities or insurance or are you an independent adviser?
A: I am an independent adviser who is licensed in securities and insurance. In order to implement a financial plan in this country, you need to be licensed to sell individual securities, mutual funds or insurance. So, we do implement plans and we are licensed.

 Q. How are you compensated? Do people pay a flat fee or an hourly rate to have a financial plan developed or are you on commission?
A: To develop a financial plan, we charge an hourly rate of $175/hour. At that point, the client can do what they want with the plan. If they choose to implement with us, then we will use the products and services available to us and we’ll offset that fee. If someone were to use our investment services, any revenue that we receive from the investments or insurance would offset the fees that they paid for the financial plan in first 18 months.

 Q. If a client has little knowledge of investment products how do you educate them or how can they educate themselves so they make wise investment choices?
A: Investing is not rocket science. There are two basics: ownership or “loanership.” After that, explaining how markets work is not all that complicated. I think the industry makes it unnecessarily complicated for people. Most people grasp pretty quickly that if they are buying a fraction of a business, they have to identify what are good businesses. It’s a lot harder to determine whether it’s the right price to pay or not.

Q. How important is asset allocation from a risk management perspective? In other words, what portion of a client’s portfolio should be stocks, bonds or other assets? How do you decide what split to recommend for a client?
A: It depends on the client’s situation. But it’s also important to know that, just moving around asset classes doesn’t necessarily reduce risk. You want to make sure that you reduce the risk at the source. Buying quality is the first step.

That is if you’re going to buy into the equity market you should be buying quality, profitable businesses that pay dividends. That will reduce your risk on the equity side. On the debt side, you want to make sure that you are buying quality debt obligations of borrowers who can pay you back. You also want to make sure that the duration is reasonable.

The next step would be to determine what asset mix is appropriate. I think in very few instances would it be appropriate to have 100% of your money in ownership of businesses, just because most people can’t handle the volatility. They wouldn’t stick with program, and they’d bail.

For most people, depending on age and stage and their experience, we would add more or less fixed income to a portfolio. There’s no exact formula. It’s determined through the financial plan, interviews and getting a sense of their ability to handle volatility.

 Q. When you are developing a financial plan or a retirement plan for a client do you consider the equity in the family home as a potential source of retirement income?
A: No. I generally wouldn’t.  In a financial plan sometimes we run the plan out beyond age 80 and there could be a short fall. Then it’s conceivable someone would sell their home and move into a rental, or a long term care facility.

But, your home is your home. Borrowing or taking equity out of the home makes no sense. The other argument is “We’ll downsize when the kids are gone.” However, in this market, condos cost almost as much as stand-alone homes or more. There’s no real way to get equity out, in my opinion.

Q. There’s an ongoing debate in the media and the financial industry about actively managed portfolios versus passive index products. What are your views on the subject?
A: I think it’s funny, because the stats show that only 20% or 25% percent of actively managed portfolios beat the index. But zero percent of passive investments beat the index!

The only index or benchmark that a person needs to  care about is the number that is in their financial plan. If you need five percent return on your investments over your lifetime to give you all of the things that you dreamed about for yourself, your family, and your community then, it’s irrelevant what the markets do as long as you get it.

Q. So, you are not an advocate necessarily of just an index or passive approach?
A: If you take an index or passive approach the problem is, which index? You’re making a market call. It’s incredibly risky. People who do so have made a huge call based on zero or little if not knowledge.

Q. Congratulations. I see you’ve been named one of Canada’s Top 50 Advisers in 2014. Tell me how this process took place and how you were ultimately named to the list?
A: Wealth Professional Magazine does an annual survey. We took part in 2014 and 2015. They base their decision on the number of clients, growth of client assets under management and other factors. And we were fortunate for two years in a row that we made the list.

It’s an honour to be on the list. But it’s certainly not how we measure our success. We measure the success of this business by the success or our clients. What we focus on is their results which we monitor and measure.

Q. The Saskatchewan Pension Plan’s Balance Fund in which non-retired members are invested earned 9.1% in 2014 and an average of 8.16% over the plan’s 29 year history. Do you think that participating in SPP can form a valuable part of an individual’s overall investment strategy?
A: Yes. Those are reasonable returns. I think that the hardest thing is accumulating the money in the first place. If you’re not doing anything else, the Saskatchewan Pension Plan makes it very easy to accumulate money at a reasonable price. Putting money into that pension plan on regular basis is a great starting spot. If you have more significant assets or a more sophisticated situation, or you are a more sophisticated investor, there may be other places to look. But, for a vast majority of people it is a place to start because SPP does some of the heavy lifting to help you save money.

Q. Thank you Chet. I really appreciate talking to you . It was a pleasure to speak to you today.
A:  My pleasure.

This is an edited version of a podcast interview recorded on April 15, 2015.

Jun 15: Best from the blogosphere

15 Jun

By Sheryl Smolkin

This week we have a mixed bag of offerings from some of our favour bloggers and media pundits. First of all, Boomer & Echo’s Robb Engen discusses Why Multiple Income Streams Is A Better Emergency Fund For Millennials.

Engen says that instead of having 3-6 months worth of expenses sitting in a savings account for an emergency fund, a better way for Millennials to combat the threat of job loss – or job uncertainty – is to build up multiple income streams outside of their traditional day jobs.

There are plenty of articles that focus on things women need to know about life after work. But in a role reversal, on Retire Happy Donna McCaw writes about Issues that Men Face in Retirement. Her interviews with a number of men about their experiences with retirement reveal that for many, identity issues are paramount. Those who do not replace the status, position, role and job satisfaction with something else once they are no longer employed can have a real challenge regaining a sense of who they are and how their lives are meaningful.

In Diving Canadian Dollar Has Made Holiday Travel More Expensive, Sean Cooper quantifies the cold, hard facts about how poor performance of the loonie as against the U.S. dollar has made travel outside Canada a much more expensive proposition. With lower gas prices, he says this just could be the year to take the family on a road trip to learn more about what our beautiful country has to offer.

Globe and Mail personal finance guru Rob Carrick believes It’s time to get real about retirement planning. He poses the questions: What’s retirement really like from a financial point of view? How likely is an unexpected financial crisis, and how do people cope financially? How big a deal are health care costs? How feasible is it to plan on working in retirement?

According to Carrick, the answers to these questions can be found in a new report issued this week by the Ontario Securities Commission and prepared by Brondesbury Group, a consulting firm. It’s called Financial Life Stages of Older Canadians.

Do you follow blogs with terrific ideas for saving money that haven’t been mentioned in our weekly “Best from the blogosphere?” Share the information with us on http://wp.me/P1YR2T-JR and your name will be entered in a quarterly draw for a gift card.

The rise of semi-retirement

11 Jun

By Sheryl Smolkin

Call it semi-retirement, phased retirement, an encore career or a second act career. It all amounts to the same thing. And a new global survey from HSBC shows it is a growing international trend.

The reality of retirement is evolving and semi-retirement – working fewer hours and/or changing jobs – is becoming more widespread. Traditionally, retirement meant a sudden switch from a busy full-time work routine to a more relaxed lifestyle. Many of today’s working age people are seeking a more gradual transition to life after work.

Easing into full retirement
While only 17% of Canadian retirees semi-retired before fully retiring, almost half (45%) of working age people are planning to ease into retirement before they stop work completely. A similar proportion (40%) expect to switch straight from their current job and working hours to full retirement and 15% expect that they will never be able to fully retire.

There are differences between men and women, with more men (42%) planning to move immediately from their current job and working hours work to full retirement than women (38%). Those closer to retirement (aged 45+) are more likely to believe they will never retire (20%) compared to those aged 25-44 (12%).

The life of a semi-retiree
Almost three in five (57%) of those working age people planning to semi-retire want to stay in the same job but work fewer hours, while just over a third (35%) are planning a change in career as well as reduced hours. A significantly smaller proportion (8%), plan to semi-retire by changing career but working the same hours.

Men are more likely than women to favour staying in the same job but reducing their hours. More than three in five (62%) men plan to do this compared to just over half (53%) of women. Conversely, 37% of women plan to change jobs and work fewer hours, compared to 32% of men.

Choice or necessity?
The graph below illustrates the reasons why Canadian retirees who initially semi-retired made the decision to do so. It is interesting to note that only 18% said they semi-retired for health reasons and 12% said they could not afford to fully retire.

Why did you move from working full-time into semi-retirement? (Base: All who semi-retired)
18%: To reduce stress
38%: Didn`t want to retire full time immediately
37%: Keep active/ keep my brain alert
35%: Like working
26%: Wanted an easy transition into retirement
28%: I no longer needed to work full time
20%: It was something I planned and was able to do
18%: Health reasons/physical demands
17%: To maintain a comfortable lifestyle
12%: Cannot afford to retire

You can’t take it with you 
When asked whether it is better to spend all of your money or save as much as possible to pass on to the next generation, the majority (66%) of working age Canadians take a balanced view, believing that it is better to spend some money and save some to pass on.

However not everyone agrees. More than one in five (21%) working age people believe that it is better to spend all your money and let the next generation create their own wealth. Comparatively few (13%) agree that it is better to save as much money as possible to pass on to the next generation.

Attitudes towards spending and saving vary from country to country. Over a quarter of pre-retirees in Hong Kong (28%), Canada (27%), the UK (26%) and Australia (26%) say that it is better to spend all your money and let the next generation create its own wealth.

In contrast, fewer working age people in Mexico (12%), the UAE (15%) and Indonesia (16%) agree that it’s better to spend all your money.

Also read: Will you be working at 66?

Jun 8: Best from the blogosphere

8 Jun

By Sheryl Smolkin

Over the last few weeks bloggers and mainstream media have been reacting to Finance Minister Joe Oliver’s surprise pre-election announcement of the government’s intention to add a voluntary component to the Canada Pension Plan. Here is sample of some of the buzz created by this proposal.

I wrote Voluntary CPP contributions will favour high earners on RetirementRedux and the blog was re-posted by John Chevreau on the Financial Independence Hub. I believe that too many questions remain unanswered and if voluntary CPP contributions are locked in until retirement, even when middle or low earners finally bite the bullet and set up a payroll savings plan, chances are they will opt for an RRSP or TFSA so they can get at the money in an emergency. Because employers probably won’t have to match contributions, there will be incentive for employees to contribute more money to CPP.

On Retire Happy, Jim Yih questions whether voluntary CPP contributions are a good idea. Yih also notes that the devil is in the details, and suggests that if there is no employer matching there is little difference between voluntary contributions to CPP or RRSPs (individual and group). Lower cost investing may be a plus but he says investors already have access to lower cost investments through Exchange Traded Funds (ETFs).

In the Globe and Mail, Bill Curry reports that the Conservative government rejected a voluntary expansion of the Canada Pension Plan five years ago as overly expensive and misguided, a history that is raising questions as to why it is now proposing that very idea. “This was rejected unanimously by our partners in the federation when we met and discussed the issue because it would not work and because the CPP would be unable to administer it,” Finance Minister Jim Flaherty told the House of Commons in September 2010.

In the StarPhoenix, Andrew Coyne writes Whether voluntary or mandatory, there is no need to expand the CPP. He says, “If people are saving about as much as they want to  now, then forcing them to save more in one way, through an expanded CPP, may simply result in an offsetting reduction in their other savings, in their RRSPs or TFSAs.” He also opines that those of modest means are already well-served by the existing CPP and the further you climb the income scale, the hazier the case for public intervention becomes.

And finally, a Toronto Star editorial says Harper’s pension ‘fix’ falls short. This piece suggests that by far the best way to forestall a retirement income crisis would be to expand and enhance the existing, highly acclaimed CPP, by upping the input from employers and employees alike. With $265 billion in assets and an enviable 18.3% return last year, the plan has expert management, huge scale and a low-cost structure. Employers and workers pay equally, to a combined maximum of just under $5,000 this year. It locks in contributions over the long haul and it provides a safe, predictable retirement income.

Do you follow blogs with terrific ideas for saving money that haven’t been mentioned in our weekly “Best from the blogosphere?” Share the information with us on http://wp.me/P1YR2T-JR and your name will be entered in a quarterly draw for a gift card.

Summer Jobs for High School Students

4 Jun

By Sheryl Smolkin

School is almost out, and high school students are looking for summer jobs. But most of the good jobs have been taken by college or university students who hit the ground running at the beginning of May. Even summer camps staffed up in the spring, so it’s generally too late to apply for these positions.

Students who are prepared to continue working part-time through the school year may find this is the ideal time to look for positions in fast food restaurants or retail. Some summer resorts may also still have openings.

However, this could be the time to hone their entrepreneurial skills by creating their own jobs. Here are some ideas for enterprising teenagers who need to make money this summer:

  1. Babysitting: I remember when my daughter was born and suddenly I no longer had time to eat, sleep or take care of the house. I was delighted to hire a high school student to walk the baby in her pram and provide back up at home. Parents with a second or third child are often even more in need of assistance.
  2. Lawn care: Lawn care companies often hire seasonal help. But if the family has a lawn mower in good repair, neighbours and friends might be happy to have a dependable young person cut their lawn, water it and weed the flower beds, particularly if they are going to be away for all or part of the summer.
  3. Pet care: We have a dog and a cat and travel often, especially on summer weekends. One year when a teenager lived across the street, he fed and played with our cat and boarded the dog at home for a few days at a time. It was certainly more convenient and less expensive than having to drive and pick up the pets from a kennel.
  4. Car washing: There is typically one or two cars parked in every driveway. They are a virtually unlimited market for an “at home” car washing and detailing service. Here are some FAQs from Consumer Reports on the do-it-yourself car wash including products to use.
  5. Odd jobs: Everybody has small jobs around the house that need to be done ranging from garage cleanup to painting fences, or laying new walkways. Seniors who are still living in their own home are a great source of clients.
  6. Temporary agencies: Students with keyboarding and other administrative skills may be able to obtain short-term placements in interesting settings. Some Saskatchewan temp agencies are listed on this website. Students can also search online for openings in their area or network with family and friends.
  7. Tutoring: Students who are a whiz in math, science or other subjects may be able to offer peer tutoring for students who are challenged by the summer school curriculum or want to get a head start on the next year. 
  8. Birthday parties: When my husband was a student, he and his brother did magic shows at birthday parties. The possibilities are endless for talented young people whether they excel in art, music or drama.

With colour laser printers in almost every home, it’s not difficult for teenagers starting a mini-business to print up flyers, business cards and invoices. Creating a simple website or blog for free has also never been easier. Prospective clients will be more receptive to neatly dressed young people with references and even pictures showing examples of their work.

The experience students gain by taking the initiative to create their own job is a great learning experience and a valuable addition to their resumes. However, in all cases the health and safety of young workers is paramount and parents should “vet” their “business plan” and provide necessary support.

Jun 1: Best from the blogosphere

1 Jun

By Sheryl Smolkin

I’m back at my desk, after a super 4-day weekend visiting my daughter’s family in Ottawa. Although we just missed the end of the tulip festival, all the lilacs were in bloom and residents of Canada’s capital were running, biking, having picnics and eating on patios. There is no doubt that summer is the time when Canadians take advantage of the longer days and beautiful weather to move both their social life and their fitness routines outdoors.

Sarah Snowden blogging on Canadian Living identifies five inspirational blogs that deliver a demonstrated authority and passion for a healthy, active lifestyle. We reproduce her top picks below.

  1. BC Runner
    Vancouver-based freelance writer and running advocate Usha Krishnan dishes up tips on everything from jogging, sprinting, and breathing techniques to running in the rain. It has a user-friendly design with useful diagrams and inspiring photos.
  2. Bicycling Blogger
    Cycling enthusiast Kevin Rokosh drives home tips on all things cycle including nutrition, racing, recovery, training, equipment — even “bikertainment”. For those looking to take their cycling up a notch, you will find this site takes a not-so-serious yet informative approach to cover all the bases.
  3. Gluten-Free Guidebook
    Travel journalist Hilary Davidson serves up reviews of restaurants, shops, hotels and products targeted at travelers with celiac disease (in which gluten, a protein found in wheat, rye and barley, damages the small intestine), and gluten intolerance. Avid travelers seeking a gluten-free experience will love this well-written account of Canadian and international destinations – you’ll be surprised by the number of establishments that are gluten-free.
  4. Cyclemania
    Founded in 2004 by Les and Helen Faber of Ottawa, Cyclemania features the pair’s exploration of scenic routes and provides a broad overview of cycle related issues. The blog imparts invaluable information on community, equipment, racing, safety, cycle experiences abroad and at home, and even spinning through posts, forums, videos and vibrant photos.
  5. Teaching Kids Yoga
    Toronto yoga teacher Aruna Humphrys spreads good karma with tips on helping kids to relax, be healthy, and enhance relationships through the practice of yoga. Posts inform readers about the latest yoga-related DVDs, books, and teaching techniques for teachers and parents alike.

And finally, Breaking barriers: Canadian-Muslim women and fitness is an interesting discussion of how barriers that have kept some Muslim women from participating in organized sports are finally crumbling in Canada. Shireen Ahmed who played on the University of Toronto’s varsity soccer squad is featured.

Do you follow blogs with terrific ideas for saving money that haven’t been mentioned in our weekly “Best from the blogosphere?” Share the information with us on http://wp.me/P1YR2T-JR and your name will be entered in a quarterly draw for a gift card.

How to buy life insurance. Let me count the ways

28 May

By Sheryl Smolkin

If you asked me how to go about buying life insurance, only two thoughts would come to mind: directly from a life insurance salesman or an online purchase. Therefore I was interested in a recent column on insureye which discussed the pros and cons of purchasing life insurance in several other ways.

Here are five of the most common ways of purchasing life insurance noted in the article you will likely encounter, plus I’ve added one of my own.

  1. Captive Agents
    Buying through an insurance agent is the familiar way to buy life insurance. You talk to an agent who represents an insurance company, you get a quote and you purchase your policy.

    You might know an agent personally because somebody from your family has already dealt with him/her. Captive agents work for one company and can sell only the products of that company. If an agent’s compensation is linked to sales performance, he/she may try to sell you as much as possible. Captive agents often have pre-determined sales quotes. They cannot compare offers across different providers so you may lose out on policy features or a better price point that an independent broker can offer.
  2. Banks
    Though banks were not significant vendors of insurance in the past, they currently sell a variety of insurance products. As required by law, their insurance business is separate from banking activities.

    You know the brand and already trust the bank with your money. Limited to the bank’s products and will not compare features, price against other offerings. May only offer simple products like term life. Do not also offer complimentary products like disability or critical illness insurance.
  3. Insurance Brokers and Financial Planners
    Insurance brokers and financial planners typically offer products from multiple providers since they work for many companies and can compare rates and products across multiple providers.

    Independent insurance brokers work for multiple companies and are less motivated to sell products from only one company. Find out how many companies the broker works with. Depending on your health, their knowledge of companies with special offerings for pre-existing conditions, poor health etc. may be more robust. Not all brokers are created equal you’re your research and get references or opinions from past clients before you commit to a broker
  4. Online aggregators
    Online platforms allow you to get life insurance quotes across multiple providers, and subsequently connect you with insurance providers or insurance brokers.

    Available 24/7. You can easily compare different quotes and find out the best offer, or change your criteria to see how that affects the policy and the price. It is important to find out how many providers an aggregator works with since comparison across three companies is not the same as comparison against 30. Lack of personal advice. Aggregator platforms offer online tools, but not all offer online chat or personal assistance. However, in most cases, aggregators connect customers to insurance brokers who can respond to any questions or concerns.
  5. Direct Call
    In most cases, purchase of insurance consists of several steps: the initial quote, medical tests (including blood and urine), a questionnaire, and the policy purchase (potentially for an adjusted price that reflects your health condition). In some cases, you can purchase insurance directly via a telephone call, without any further interactions. Generally however, the product would be a guaranteed issue or simplified issue insurance policy. These products do not require medical tests.

    Easy and fast. You call, in some cases answer a few questions and you are done. That is much simpler than have a nurse visit your home, conduct your health check and take your fluids. Since there are almost no insurance checks, an insurer automatically assumes that you are a high-risk customer (e.g. pre-existing conditions) and thus will charge you more than other customers who agree to medical tests. A telephone call will get you only a limited amount of coverage e.g. $10,000 or $20,000. Do not expect coverage of $1,000,000 of coverage in guaranteed or simplified issue policies.
  6. Group insurance
    If you are employed, some group life insurance may be offered as part of your employee benefit package. Since employer-paid life insurance premiums are a taxable benefit, you may be required to pay all or part of the premiums via payroll deduction. You may also be offered additional optional group life insurance for you and family members.

    Because group life insurance is easy and often fully or partially paid for by your employer, it’s a “no-brainer” for most people. An added advantage is that for the basic amount, no medical examination is required. Term insurance only. If you need coverage for an extended period, group insurance premiums are often more expensive than individual rates since group rates tend to increase annually or on an age-banded basis while individual life premiums remain the same for a specified period. If you leave your employer you must arrange new coverage. “Follow me” policies that do not require medical evidence are available from most carriers but they may be more expensive than comparable individual coverage.

For the pros and cons of optional group life insurance, see Should you buy extra life insurance at work?

However you choose to purchase life insurance, it is important to ensure your family is adequately covered. You can calculate how much life insurance you need here.


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