From insurance to inflation: how to save more and earn more

With the continued high inflation and uncertain economic times, this is a great time to look at ways to save and make money safely in different ways.

Let us start with life insurance, which is the foundation of the insurance industry and a product that has generated enormous wealth for them for a long time. This product is generally known as cash value life insurance and it can also be known as universal life, variable life, whole life and other names as well. No matter what, it has many flaws. The question is, “Who should have this type of insurance?” And the answer is, “Probably no one.”

The mechanics are too long to dissect here, but here are a few of them: 1. All too often you wind up with only a portion of your cash value (savings) and maybe none at all.

2. You can borrow against the cash value, but you are paying interest to use your own money.

3. If your policy has dividends, all that really represents is an overpayment of premium.

4. Putting a lot of insurance on children who do not have income is usually a bad idea, as is too many policies in one family.

If and when you need life insurance, the correct variety is low-cost level term, as it generally costs much less, pays much more and is easier to follow.

Auto insurance and other forms of insurance are all primarily based on one word, as well: risk.

When selecting these kinds of insurance, very often lesser-known but well rated companies can be as good as the household name companies. You can save some serious money on all these forms of insurance by increasing deductibles, not duplicating coverages and making sure you have enough insurance for your needs.

I have found in my own case that I was able to reduce my premiums by nearly 50% on auto insurance while still getting all the coverage needed by simply altering or deleting unnecessary coverages.

If you are retired or close to it and still have a mortgage, you can often save a ton of money by amortization of your mortgage, which means simply paying more money on your principle each month. This will shorten the term of the loan and save you a lot of interest costs.

Some other ways to save and make money in these trying times is pay yourself first by investing in a good, solid investment such as indexed annuities, which will follow the stock market only when it’s going up and therefore is free from market risk if done correctly.

Offsetting inflation

It’s usually a good idea when shopping to be aware that the less expensive items are often placed lower on the shelf. Some other areas that you may be able to save money can be found in cell phone bills, cable bills, food expenses and travel.

We have all seen the rapid rise in inflation and fuel prices, and one of the best ways to offset all of it is by self-employment. If you have a skill or interest and can produce a service or product that people need or want, you may be on your way.

Years ago I began my career in the financial services area while still teaching high school social studies, and was fortunate enough to retire early as a result. The secret really is that even though it required many long hours, it never quite seemed like a job, and I always liked the idea of helping people save and make money at no cost to themselves.

When you really think about it, the best way to get ahead these days if not become wealthy is to copy those who have done it. Make no mistake, though, as it takes a lot of determination, hard work and learning from mistakes and setbacks.

That said, those with wealth got it, for the most part, by either investing or starting their own business. It is very important to pick something you really enjoy and that people will want and benefit from, and the Small Business Administration can be very helpful in getting you started.

Hopefully these ideas on saving and making money have been helpful to you. For further reading, I would suggest the following books:

• “How Your Life Insurance Policies Rob You” by Arthur Milton

• “Wealth Without Risk” by Charles Givens

• “The Power of Positive Thinking” by Norman Vincent Peale

• “Think and Grow Rich” by Napoleon Hill

There is no telling how far you can go, and I always liked the old saying, “If you think you can’t, you’re right, and if you think you can, you’re right.”

Howard S. Blanck