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Your life insurance monthly premium can start looking less and less appealing once you've retired. It's a scenario Dan Simon, a retirement planning adviser with Daniel A. White & Associates in Middletown, Del., has seen quite often, even with his own parents. "The cost of the insurance had risen to the point where it was getting unaffordable. They were wondering do we really need to keep this coverage now that the kids are all grown up?"
If you stop paying your premiums, you lose your life insurance coverage, and your heirs wouldn't get anything back for what you've paid in. If you cancel a policy that has cash value, a reserve of money built up in some types of life insurance, the insurer sends you a check for that amount, though it will be far less than the listed death benefit.
Over the past 20 years, a third option went mainstream: selling your policy to a company, a practice known as a life settlement, with the buyer getting the death benefit when you die.
SEE MORE Don't Fall for That Life Insurance Ad on TV
"It's kind of morbid when you think about it. A group buys boatloads of policies from people that have fallen on hard times and can no longer afford their insurance," profiting from the seller's death, says Simon. "In theory, they want you to die tomorrow. If you live another 20 years, it's a bad investment for them."
Selling a life insurance policy generally isn't a great deal for you either, and there are better alternatives worth exploring. Simon finds that people typically turn to selling a policy when they're desperate. Usually, it's because they've spent down their other retirement assets, or they might be dealing with high medical bills. "It's a measure of last resort, like taking a reverse mortgage. I rarely see them working out well for people, and they could en
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Investors have plenty of worries - chief among them inflation and a potential recession. But the engine that ultimately drives the stock market is corporate profits. As long as earnings growth stays on track, then corporate America—and by extension, your stock portfolio—remains on solid ground.
Which is why the recent earnings preview from FedEx (FDX) was so unnerving. While the official report for the quarter ended August 31 comes out Thursday, FedEx warned on September 15 that it would have bad news, with quarterly results severely impacted deteriorating economic trends in Asia, Europe and the U.S. FedEx stock was immediately penalized, and is down more than 20% since this pre-announcement.
The key question for every investor is whether the shipping giant is suffering from a company-specific malaise or whether FedEx's problems are a broad-market bellwether portending widespread doom. "FedEx is no ordinary economic actor, as its business literally touches every corner of the global economy" says Sheraz Mian, director of research for Zacks, an investment research firm.
A Downgrade for FDX
Analyst Colin Scarola, at investment research firm CFRA, suspects that part of the problem at FedEx is that it failed to adjust operations in its Express division (50% of revenues) as more international passenger flights, which transport some air freight as well, came back online after the pandemic-related slowdown, raising competition. "We don't doubt that some of the poor performance is related to ongoing global economic headwinds and high inflation worldwide. But the extent of the decline at Express leads us to believe that poor operational execution is also at play," says Scarola, who has
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