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What Dave Ramsey Thinks About Variable Universal Life Insurance

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I recently needed to find an answer to a question I had about Variable Universal Life Insurance so I check Dave Ramsey’s site for the answer and found this.

A listener asks if he should he do a variable universal life policy if he has no debt except the mortgage and has maxed out all retirement savings.
ANSWER:
No.  You should pay off your house before you do any additional investing and make sure you’re only investing 15% in the retirement savings plans.

The variable universal life policy (VUL) is the latest version of a cash-value life insurance plan.  It’s a mutual fund snuggled next to an annual renewable term life policy (ART).  ARTs go up every year based on your age, which means it is one of the most expensive ways to buy term insurance.

When you’re paying for both a mutual fund and the ART at the same time your insurance is too expensive and the money that’s supposed to go to your investment goes through the insurance company first.  This means you’re paying tons of unnecessary fees.

It’s an expensive, high-fee way to invest.  Just buy the mutual fund instead.

November 25, 2007 | Filed Under Financial Advice, Life Insurance | 5 Comments 

Why Baby Steps Are So Important – Decision Happen Now, Results Take Time

959864706_894bdfaa56.jpgWe live in societies of instant gratification. We want things to change the moment the idea of change comes into our minds. Waiting for results is almost unbearable. How many times have you wished that you could blink to change televisions stations on your TV? Ok, maybe you haven’t wish that particular absurdity but I am sure you have wished for similar.

I have said it before and I will say it again. Financial peace comes with time. Unless you have just inherited a large sum of money, you will have to take baby steps like all the rest of us. Let’s take the idea of baby steps further and think about how babies learn to walk.

First steps are very difficult. Some babies would rather wait until that completely ready before they even attempt to stand up. Some babies are eager and seem to stand up the minute they are born. In each personality type they eventually learn how to walk. Standing up against a couch or wall, letting go and standing with no support and then they take their first step. Looking at their face you see intense concentration, and determination. Have they gained huge strides in feet? No, but they have in spirit and have finally learned to move forward like Mommy and Daddy.

So how can we learn from babies? Babies know they have to start some where. They first recognize that Mommy and Daddy are walking. We could say that the first move in gaining financial freedom is recognizing the need to improve.

The baby then finds support against a wall or couch before attempting the first step (yes I know some babies have been know to stand up in the middle of a room but I am trying to make a point here). Finding the right support and information about gaining true financial freedom is very important. With the wrong information we could end up never taking steps forward at all. As you probably already know I high recommend Dave Ramsey as a teacher.

Now that we have the motivation, decision to change and the right support we are ready for our first physical step. I have observed some babies reach this point and for weeks they don’t take that first step. They practice standing and walking around furniture but don’t have enough confidence to actually take a step on their own. Mommy and Daddy encouraging them all the way but the baby is fearful of going out on her own. I have also seen this happen with people when talking about their finances. Statements like “I will just keep one credit card in case of emergencies”, or “I hate debt but I am never going to get out of debt anyway so I might as well give into it”, tell me that they understand the need for change and may have the motivation to change but are to fearful to take a step forward. Fearful of going out on your own and making huge strides in your spirit but not necessarily large steps because baby steps are small.

I am very harsh on the topic of using credit cards and acquiring debt. I am this way because I have seen nothing but pain come from it. Credit card use encourages the instant gratification attitude that will hold you back.

So where are you in this parallel? Do you recognize the need for change? If not, look at people who have gained true financial freedom (this does not have to mean making lots of money either)and tell me you don’t want to be there.

Are you at the place of being sick and tired of the same cycle but are now looking for support and a good model to follow? Dave Ramsey is the best financial counselor I have every come across and will give you practical was to change. He is also a very good motivational speaker.

Are you now ready to let go and not let the fear of the unknown keep you from moving forward? You can become motivated and make decisions to change but none of that matters unless you take the first steps. You can’t make someone change you! You have to decided to you are going to walk and to take your first baby step.

Photo provided by flickr user sean dreilinger.

November 24, 2007 | Filed Under Financial Freedom Journey Pep Talk | 3 Comments 

Are You Truly Thankful For What You Have?

Most people have many reasons to be thankful. Even the most down and out of individuals have reason to be thankful. This time of year in the United States many Americans are thinking about what they are thankful for. Yes, there are things that may not be ideal situations in our lives but when we think about what truly matters then we should be able to find many things to be thankful for.

I searched online for a story that would put things in perspective for us and I found a great one on Inspirational Journal.

One day a father and his rich family took his son to a trip to the country with the firm purpose to show him how poor people can be. They spent a day and a night in the farm of a very poor family. When they got back from their trip the father asked his son,

“How was the trip?”

“Very good Dad!”

“Did you see how poor people can be?” the father asked.

“Yeah!”

“And what did you learn?”

The son answered, “I saw that we have a dog at home, and they have four. We have a pool that reaches to the middle of the garden; they have a creek that has no end. We have imported lamps in the garden; they have the stars.

Our patio reaches to the front yard, they have a whole horizon.” When the little boy was finishing, his father was speechless.

His son added, “Thanks Dad for showing me how poor we are!”

Isn’t it true that it all depends on the way you look at things? If you have love, friends, family, health, good humor and a positive attitude towards life – you’ve got everything!

November 16, 2007 | Filed Under Financial Freedom Journey Pep Talk, Life Goals | Leave a Comment 

Quotes That Make You Think

My teenage daughter likes to search for interesting quotes on the internet and read them to me. She was doing this the other day and came across some really good ones on various topics. It is interesting how a quote can sum up an entire thought. I decided to do my own search for quotes on success.

Whether we are speaking of success with finances, building a business or overcoming something the basic truths are the same. In order to be successful we need to expect failure and be able to embrace that failure by learning from it. We need to persevere and “keep moving forward”. Here are some quotes that sum up what it takes to achieve success.

“If at first you do succeed — try to hide your astonishment.”
Harry F. Bank

“Success is not a matter of desire, but the product of hard work.”
Jack Barringer

“I have learned that success is to be measured not so much by the position that one has reached in life as by the obstacles which he has overcome while trying to succeed.”
Booker T. Washington

“Success seems to be largely a matter of hanging on after others have let go.”
William Feather

November 7, 2007 | Filed Under Financial Freedom Journey Pep Talk, Life Goals | 2 Comments 

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