Borrow Your Own Money?
Dear Dave,
I have a question about self-banking with whole term life insurance. The way I understand it, you can accrue a cash balance, borrow against it, and then pay interest to yourself. Is this worth it, or should I stay away from it and continue using a bank?
Kunal
Dear Kunal,
Actually, it’s a whole life policy, not a term policy. And it’s an absolute scam.
Basically, with whole life you pay about 20 times more for the same amount of insurance that you would with a term policy. The extra money goes into a savings account, and you earn next to nothing on it, even after you finally start to build it up. One of the ways they’re pitching it now is the self-banking concept, where you can use your own money. It’s nothing magical or anything, because with a regular checking account you use your own money.
What is impact investing and do you consider it a worthy pursuit?
Share This
Dear Dave,
A friend recently mentioned something called impact investing to me. What exactly is this? How do impact investment funds perform, and what do you think about them?
Carson
Dear Carson,
Impact investing generally aims to benefit society, while providing a profit for the investor, by investing in companies, funds and organizations that are aligned with causes, certain values or issues. Think of it as a middle ground between traditional investing and charitable giving, where you can match your investing with your own particular beliefs. It really isn’t all that different from investing in traditional mutual funds, except for the goal of the funds.
Dave Says: Discussing Finances With Your Spouse townhall.com - get the latest breaking news, showbiz & celebrity photos, sport news & rumours, viral videos and top stories from townhall.com Daily Mail and Mail on Sunday newspapers.
They’ll Play on Your Emotions
Dear Dave,
I’m on Baby Step 2. I’ve paid off almost all my debt, and I’m living on a monthly budget. Recently, I got a call from a debt collection company about an old medical bill. They threatened to garnish my wages, and from the way they talked, I’m afraid they may actually do it. How should I handle this situation?
Gwen
Dear Gwen,
First of all, they won’t garnish your wages. They can’t. For that to happen, they would have to go through all the formal, legal steps of suing you, and then they’d have to win the case. Debt collectors like to play with people’s emotions because, many times, folks will give in and do whatever they want whether they can afford it or not.
Dear Dave: My Children Aren t Wise With Their Money townhall.com - get the latest breaking news, showbiz & celebrity photos, sport news & rumours, viral videos and top stories from townhall.com Daily Mail and Mail on Sunday newspapers.