The  Money Tasks You’re Avoiding And How To Make Progress (Part 1)

The Money Tasks You’re Avoiding And How To Make Progress (Part 1)

Financial wellness is like eating healthy – it’s hard work and no fun but you know it’s good for you. Think about it, you always feel better after a healthy meal instead of a highly-processed one. But building a balanced meal plan takes more time and effort to accomplish. The same is true for a healthy financial plan. Not every financial planning task is exciting and groundbreaking, but each step secures your goals and vision for the future.  So let’s dust off your to-do list and explore actionable resources to help you accomplish some healthy financial tasks. 

1. Increase (or Get) Life Insurance

Life insurance is one of the easiest tasks to forget, yet it’s crucial if you carry significant debt or have dependents who rely on your income. The truth is, everyone who buys life insurance hopes their loved ones never need to use it, but it’s a true safety net for your family. 

Life insurance comes in many shapes and sizes; the two broadest categories are:

  • Permanent life insurance
  • Term life insurance

Permanent policies can offer good benefits but aren’t right for everyone. Due to the comprehensive nature of these plans, premiums are nearly four times higher than term policies and often don’t offer enough benefits to justify the sky-high rates. While these policies can accumulate a cash balance and investment opportunities, you can usually see more substantial returns through regular portfolio contributions.

Term insurance lets you buy a policy for a set time, anywhere from 10 to 30 years. The coverage lasts for that specific time and stops when the term ends. Term coverage is much more affordable than permanent coverage, which makes the monthly commitment much easier to stomach. Your coverage cost usually depends on:

  • The provider (you can get a better price depending on the company you buy a policy from, so shop around and understand any fees before signing on the dotted line). 
  • The amount of coverage (a $1 million policy will be cheaper than a $2 million).
  • Your age (younger people tend to have lower premiums).
  • Your health (healthy people (i.e non-smoker, physically fit, etc.) tend to pay less).
  • Gender (men typically pay more than women) 

One of the most common questions about life insurance is how much coverage you’ll need. Your coverage level is unique to you and your situation. Here are a few things to consider:

  • Your income
  • Family size and additional income
  • Existing insurance coverage
  • Net worth
  • Current portfolio and retirement assets

Did you just start a family, buy your first or second home, or start your own business? All of these should spark review to potentially increase coverage that meets your changing needs. Keep in mind, not everyone needs life insurance. Someone with no debt or dependents doesn’t need the added monthly expense.

2. Prepare Your Estate Planning Documents

People have a laundry list of reasons to avoid estate planning. But it’s not as painful as it’s made out to be. 

In fact, in the wake of the pandemic, many are re-evaluating their documents to ensure everything’s up to date. From video conferencing with their attorney to digitally updating or drafting a new will, people have been creative in how they approach this financial chore. Not sure where to get started? Let’s look at some key estate planning documents:


A will outlines your wishes for your estate. One of the most common reasons people put off creating one is a perceived lack of assets. Do you own a car or house? Are you an entrepreneur who owns their own business? What about valuable jewelry or collectibles? Maybe even a coffee can full of cash? Once you start looking, you’ll find you have several assets to plan for. A will gives you a dedicated space to help ensure your estate gets divided according to your wishes.


In their will, parents either need to add or update guardians for their children. A guardian is someone who will care for your children should you be unable to. While a guardian cares for the children’s wellbeing, a trustee handles the finances like taxes and inheritance. 


For those planning to leave significant assets to family and loved ones, a trust is an excellent vehicle to consider. Trusts are private and secure, giving you the freedom to select one that will work best for you. For example, if you want your legacy to have a charitable-focus, you might consider a charitable remainder trust which funnels a certain amount to your chosen charity and the remainder to your beneficiary. 

Financial Power of Attorney

This gives someone the ability to handle financial matters on your behalf like settling debts, paying taxes, and more. 

Medical Directive

This gives the person of your choice the ability to make medical decisions on your behalf should you become incapacitated. It’s best to choose someone like-minded who will respect your wishes. 

All these tasks can’t be completed at the same time. Sit down and see where you’re at and make a detailed plan from there. If you’re starting from scratch, maybe start with drafting a will. If you haven’t updated your plan in years, see if your beneficiaries are still aligned or if you need to change a guardian or power of attorney. 

Estate planning is meant to bring confidence, clarity, and peace of mind to your financial plan. Taking the time to update your documents ensures your life is in order to create a seamless financial transition to children, family, or charitable organizations. 

3. Set Up or Rebalance Your 401(k)

A 401(k) is a tax-efficient way to save for retirement. Pre-tax contributions lower your taxable income and boost future savings. But to maximize the plan, you first have to set it up. Creating a new account can seem daunting (which is probably why you put it off in the first place), but it doesn’t have to be stressful.

When creating your account, you’ll have to make a few decisions:

Choosing which account to fund

Traditional, Roth, or even both depending on your plan.

Selecting your contributions

Most 401(k)s are funded by payroll deferrals, which means you select a percentage of your salary to fund the account. Struggling with how much to contribute? Start by putting in enough to qualify for a company match if you have one (normally 4-6%). A good rule is to increase your contributions with a raise, bonus, or other salary bump.

Making investment choices

While your company’s provider has some control over the pool of investments you have to choose from, you are able to decide how you want to allocate your investments.  Start by determining how much risk you want to assume (high, moderate, or low) and assess from there. 

Establishing your 401(k) is not a one and done activity. It’s important to periodically rebalance your portfolio. Rebalancing means buying and selling funds in your plan to maintain a consistent allocation and risk preference. It’s best to make rebalancing part of your annual (or even quarterly) process as it limits volatility and helps maintain your risk levels and time horizon.

Having the appropriate amount of life insurance, getting your estate documents in order and setting up your 401(k) and rebalancing every six months are just a few of the tasks you need to make progress on (and are probably avoiding). In our next post, we’ll cover four additional areas that I see people drag their feet on when it comes to taking care of their money.

How to Find Cheap Health Insurance

How to Find Cheap Health Insurance

No one enjoys dealing with health insurance. It’s complicated, confusing, and now, potentially a subject of conflict with your neighbors or relatives depending how you feel about things politically.

Like it or not, though, it’s an essential part of life as a successful, independent adult. That doesn’t mean it has to be an expensive part of your life.

While it’s a necessary cost, you can get proactive and take a few steps to find a reasonably-priced policy that also provides the coverage you and your family need.

Skipping Insurance Is Not the Cheap Alternative

Let’s just address this upfront: going with no insurance is not a way to save money on this cost. Paying for health care costs when you need care without insurance can drain your bank account of tens of thousands of dollars — or more.

Plus, under the Affordable Care Act, going without health insurance coverage means dealing with a tax penalty. (There are some exceptions to the rule.)

The penalty is a flat-fee that’s adjusted for inflation each year. In 2017, the fee for skipping coverage was 2.5 percent of your household’s adjusted gross income.

So if no insurance is not an option, what is when it comes to cheap health insurance?

Know Exactly What You Need

The best way to get cheap health insurance is to avoid paying for what you don’t need. If you’re young, healthy, and don’t often see a doctor beyond annual checkups, you could get away with minimal coverage.

And depending on your needs, you may not want to pay for additional policies like dental and vision. Paying for those visits out of pocket when you need to go could be cheaper than purchasing insurance that includes plans for these providers.

Obviously, you need to be honest with yourself here. Don’t skip on coverage that you are likely to use. It’s cheaper to be insured for what you need rather than to risk it and go without.

Evaluate and Compare Your Options

Once you understand what you need to cover, look for policies that provide just enough coverage (but not so much that you’re paying for something you’re unlikely to use).

You can work with an agent, use a database like (or to shop state exchanges), or do your own research and buy directly from insurance companies.

If you choose to work with an agent, make sure they’re an independent broker and not associated with a single company. You can also ask your financial planner for references if you don’t know where to start.

Seek Out High Deductible Health Plans

Deliberately looking for high deductibles might sound counter-intuitive. We’re on the hunt for cheap health insurance after all, right?

Yes, and a high deductible health plan (HDHP) can actually cost you less out of pocket than health insurance with lower deductibles.

Again, if you’re young, healthy, and rarely need health care outside of annual exams or don’t anticipate any major changes to your health in the next year, this strategy could help you save because high deductible plans come with lower monthly premiums.

In addition, having an HDHP allows you to access health savings accounts, which are really powerful saving and investing tools. You can contribute money to HSAs to use for medical expenses, which can help you manage that high deductible.

You can invest the money in certain funds in your HSA, too, which gives you a chance to put those savings to work for you.

Even better? Money you contribute to the account is tax-deductible and you don’t have to pay taxes on investment gains or what you withdraw from the account as long as you spend the money on qualified healthcare costs.

Here’s the catch with HDHPs: the deductible can be overwhelming if you don’t keep that cash on hand in the event of emergencies. So if you choose to get a high-deductible health plan to enjoy lower monthly premiums, ensure you keep the amount of your full deductible in your emergency fund should you ever need to pay it.

Take Advantage of Open Enrollment Periods

By knowing what you need, evaluating your options and shopping around for the policy with the lowest cost that still gives you the coverage you want, and making use of options like HDHPs, you can secure an affordable healthcare plan for yourself or your family.

But as you’ve probably noticed, things in this area of life change frequently. Whether it’s because new concerns about your health crop up throughout the year, family plans change, or national politics causes a disruption to your existing coverage, you can’t assume your existing plan will be the best plan for you next year.

Know when your open enrollment period is, and plan ahead each year.

Put a task in your calendar to review your coverage on an annual basis and chat with your fee-only financial advisor if you need help sorting through the options and determining which plan is best for your overall financial and physical health.

Episode 36: How to Protect Your Wealth with Parker Cox

Episode 36: How to Protect Your Wealth with Parker Cox

Financial Planning
Financial Planning
Episode 36: How to Protect Your Wealth with Parker Cox


This week I sat down with property & casualty insurance professional, Parker Cox.

Parker is head of sales and marketing for KM Insurance Services, an independent insurance agency that has been serving San Diego for nearly 40 years. He’s passionate about insurance, not because of a masochistic appreciation of legal jargon, but because it gives him an opportunity to help families, business owners and people protect all the things they work so hard to build.


  • What property & casualty insurance is and why you shouldn’t ignore it
  • What to consider when you’re locking in your auto insurance coverage
  • The number of people who are underinsured or uninsured with auto coverage and how it could impact you
  • Questions to ask when evaluating if you can afford to not have certain coverage
  • Whether it’s smart to shave a small growth percentage of wealth to protect yourself from a catastrophic loss
  • Whether you should pay premiums annually versus monthly
  • What to consider when selecting coverage for your personal property & liability under renters insurance
  • Recommendations for how to document and record the personal items you have in your home
  • What special form coverage is and how it impacts youas a home owner
  • Considerations when determining how much coverage you actually need for dwelling, personal property, personal liability and living expenses




How I’ve Saved Thousands of Dollars in One Year (and You Can too)

How I’ve Saved Thousands of Dollars in One Year (and You Can too)

When people think of saving money, it’s often translated into feelings of deprivation and if you’re like most people, you probably don’t get excited about depriving yourself. Instead of trying to save money by limiting the things you enjoy in life like dining out or travel, there are ways to save creatively by reducing taxes (meaning more money in your pocket) or limiting lifestyle overhead expenses (such as utilities and living costs).

Here are eight creative ways to save cash (that we practice in our house too):

• If you have $1,000 set aside in an emergency fund, take a few minutes to bump up your deductibles to $1,000 on your auto or home insurance policies to reduce your premiums. Since you have the funds on hand in case of an emergency, you’ll be able to cover the deductible without using your credit card and also save money by reducing your premiums.

• Pay your insurance premiums annually. Whether it’s life, auto or home insurance, you’ll almost always get a cheaper rate when you opt to pay your premiums annually instead of monthly. The way to prepare for this expense is to open a separate savings account and divide the annual payment by 12. Stash away that amount each month for 12 months so that by the time your premium is due, you’ll have the cash on hand to pay in full and will have paid a lesser amount.

• If you’re a homeowner and haven’t already jumped on the refinance bandwagon, it might be time to quickly consider getting on. Rates have been low for months and are set to increase in the months ahead. Depending on what your current mortgage interest rate is, this could save you hundreds if not thousands of dollars each year. Just be sure to consider the fees involved with the refinance and how long you’ll be staying in the home before jumping in.

• Before hitting “buy” for the items in your online shopping cart, do a quick Google search for “name of the store + coupon codes” to see if there’s any coupons or discounts you can benefit from on the purchase. Why pay full price if the option to save 10-20% is sitting just two clicks away? Also, is anyone else in love with Target’s Cartwheel app?!

• Get a better credit card. If you’re someone who uses your credit card for purchases and then (hopefully) pays off the balance in full each month, you want to make sure your rewards program is working for you in terms of cash back, gift cards or travel. If your credit card isn’t providing the best rewards, check out Nerd Wallet’s list of best rewards credit cards to find one that’s a fit for you. Stocking up on rewards points is a great way to then fund travel and vacations or cash them in for holiday and birthday gifts.

• Look at your company benefits. Does your employer offer flexible spending accounts? If you have children and are paying for daycare while your company offers this benefit, you’re able to stash away up to $5,000 into this account pre-tax (which means you’re saving money on income tax) and then use it to pay for childcare. Assuming a 25% tax rate, that’s $1,250 back into your pocket for the year.

• Brush up on your negotiation skills. Looking for a higher salary, better price on your new car or for more work-life balance? Practice your negotiation skills with a friend or partner before heading in for conversations and deal making. Document your points and practice getting push back. Worst case you get a “no”. Best case, you get what you want, which hopefully means more money in your pocket.

• Get a price adjustment. When you buy something and the price drops within a week or two, you can often get a refund for the difference depending on the retailer’s policy. Using an app like Paribus to review your transactions will help you to find money automatically when they track your purchases.

Are Your Finances as Bad as You Think?

Are Your Finances as Bad as You Think?

When meeting with prospects for an initial consultation and with clients for their first meeting, I tend to get the question of “how do we compare to your other clients?” Most people have an image in mind of where they think they stand with their finances. It’s either bad, reallllyy bad, okay, good or great. Ultimately though, it’s hard to have a sense of confidence about where you stand without first doing the work to figure out, well… where you are standing. I wish I could tell you that it won’t be as bad as you think or it will be as great as you imagine, but honestly, we won’t know until you take the time to evaluate where you stand and figure out what kind of moves you need to make to get to (or stay) where you need to be. If you’re looking to take stock and see which boxes you have “checked off,” here are some important, self-evaluating questions to ask yourself to assess the current state of your finances:

  • Do you have a fully funded emergency fund?

If you’re a single income home, you should aim to have 6 month of “must have” expenses set aside into an easily accessible and liquid (i.e. cash / savings) account. If you’re a dual income family, you can likely get a way with 3 months, but 6 is better. Life is unpredictable and unexpected things happen all the time. It’s not a question of if things will happen, but a question of when and your finances will be in a much better state if you have the cash set aside to handle those unplanned moments than if you need to rely on credit cards and dig yourself into debt.

  • Is your credit score in the “excellent” range?

Aim for a credit score to be 720 or higher. Your credit score is your financial report card, except there’s no getting rid of it after college. This number will save or cost you money over your life. The higher your score, the lower the interest rates you receive and the more money you save when it comes to taking out a mortgage or car loan. Your credit score simply indicates your creditworthiness and tells a lender how reliable and timely you will be in repaying a loan. Having a strong credit score is invaluable to always provide you the best financing options. Related article: What Millennials Need to Know about Their Credit Scores

  • Are you saving at least 10% for retirement?

If you’re in your 20s, you should aim to save 10% of your income for retirement. If you’re in your 30s, aim for 15%. The earlier you start saving, the better and when it comes to determining how much you should save, it’s important to think through the future you want. Take the time to consider what it is you would love to do in retirement and when you think you’d want to retire.

  • Are you able to meet everyday expenses?

If you’re relying on credit cards and debt to get by, chances are it’s time for a financial change. Often times the reason people feel like they’re living paycheck to paycheck isn’t because they don’t have enough money. It’s that they aren’t wisely spending the money they do have. When this is the case, it can be a fairly straight forward exercise to get your cash flow in order so that you can meet everyday expenses with ease. It’s important to first understand your current spending habits by tracking your spending. Once you know where your money is going, you can determine which expenses you can eliminate altogether and other spending habits that could be altered to more easily cover your fixed expenses and align the rest of your money in the areas you care about the most. (Note, if getting out of debt is necessary – I recommend freeing up money to go towards a debt pay down plan).

  • Do you feel well compensated for your job?

Remember that when it comes to compensation, it doesn’t have to only be about the salary. You can also consider benefits, bonus structure, employee stock options, flexible vacation policies and work from home arrangements. If the income and benefits you earn for the work you do doesn’t feel good, it might be time for a change. Don’t be unwilling to negotiate a pay raise, especially after successfully completing an important project. If you’re working hard and doing great work, ask to be compensated for that. If your current employer isn’t able or willing to pay you what you’d like, are you ready to consider a move to another company or start a side hustle? Forbes reports that employees who stay in companies longer than two years get paid 50% less. If you don’t feel well compensated right now, know that you have options if you’re willing to take action.

  • Is your net worth growing?

 Your net worth is your total financial worth – measured in dollars and is something I consider a measure of your financial health. After you take all your assets and subtract all your liabilities, what you’re left with is your total net worth. As the years progress, what you want to see happen is that your assets grow and your liabilities decrease. Start with where you are today – know your number – and keep track every 6-12 months to see if your assets are, in fact, increasing over time. If your net worth is stagnant or in decline, you’ll want to know what is causing the lack of growth so that you can tackle any issues getting in the way of your financial health.

  • Do you have a debt pay down plan in place?

If you have debt, you’ll definitely want to have a pay down plan in place. There are many ways to get out of debt, but the two most effective ways are the debt snowball and the debt avalanche. Both plans involve aggressively paying down one balance while making the minimum payments on the rest. The difference lies in what order you tackle the debts. With the debt snowball method, you pay off your debt from the smallest to the largest balance so that you establish good habits and roll more and more money into the next debt. With the debt avalanche method, you pay debts down from the highest interest rate to the lowest interest rate so that you pay as little in interest as you can and roll that savings into the next debt. The most important thing is to have a plan in place on how YOU are going to pay down your debt and stick to it.

  • Are your taxes under control – did you owe or receive a refund?

Ideally, you want to break even at tax time, otherwise you’re giving an interest free loan to the government if you get a refund (or you feel kind of annoyed if you owe). Zero is the goal! If you owed a lot for taxes or you received a sizeable tax refund, something went awry this year. The way to make sure you don’t owe again next year is to understand your tax liability and adjust your withholdings accordingly. Perhaps reach out to your human resources department to update your W-4 or adjust your quarterly payments if you’re self-employed and business is growing.

  • Do you have the right kinds of insurance in place?

Insurance is a tricky topic, but at a minimum you should ensure you have some sort of health insurance and disability insurance in place. In addition, you’ll need life insurance if there are others who are dependent on your income. Property and casualty insurance (such as auto, home, umbrella and renters insurance) are also important to have in place. Always work with your broker or agent to confirm you have the appropriate level of coverage needed for your situation. Don’t just guess at it!

  • Are your investments appropriately diversified?

If you’re saving for retirement and your investments are sitting in cash, chances are the answer to this question is “no.” Your investments should be allocated based upon the time frame until you’re needing the funds. There’s debate between when to invest or not invest for short to mid-term goals, but if you need the funds in less than 5 years, a CD is going to be your safest bet. If you’re investing for the long run, ensure you have a mix of equities and fixed income, small and large firms and domestic and international. Leverage mutual funds and exchange-traded funds, which will help you to diversify when starting out with smaller sums of money. How many of the above did you answer “yes” to? If you’re 10 for 10, then chances are you’re on a solid financial track! If there are any questions that left you wondering or thinking you might need a change, there’s no better time than now to make some adjustments. The best thing you can do is be aware of how you’re doing and keep track of your financial health year after year.