Jonathan Pond


Insurance Coverage That You Can Probably Do Without

Chances are you need a lot of insurance, but don’t buy into sales arguments that you need costly insurance that provides you with coverage only for a limited range of events. It’s always preferable to acquire broad coverage.

  • Rental car insurance.  You probably don’t need rental car insurance, despite the often-vigorous efforts by the rental agent to sell you this costly coverage. Most personal auto insurance covers accidents involving the car you rent for personal use. In addition, your credit card may cover rental car damage when you use that card to rent the car. Check with you auto insurance agent and credit card provider for more details.
  • Critical illness insurance.  Stay away from a critical-illness policy if you already have comprehensive health insurance. These policies only protect you in the event some specific illness befalls you, like cancer. They’re a waste of money.  
  • Mortgage insurance.  Avoid insurance that will pay off your mortgage if you die unless you’re ineligible for term life insurance.  Reason:  Mortgage insurance coverage typically declines as you pay down your mortgage, yet the premium may stay the same. By contrast, the value of the death benefit on level term life insurance doesn’t decline and is usually far cheaper.
  • Non-medical life insurance.  You may get a solicitation in the mail offering life insurance that doesn’t require a medical examination. If you’re near death, it’s a great deal. Otherwise, this coverage is shamefully expensive although the slick advertising makes it seem cheap.
  • Identity theft coverage.  Generally, you can forget identity theft insurance — or credit report monitoring services, for that matter. Many homeowner’s and renter’s insurance policies already cover identity theft. As for the credit report monitoring service:  You’re already entitled to one free credit report annually from each of the three credit reporting agencies. Plus, there are a number of other circumstances under which you may get a free credit report — including if you’re an identity theft victim.

Smart Money Tips

  • Avoid the rearview mirror when managing your money. Too many people are basing their investment decisions upon what has recently happened in the stock market. By staring in the rearview mirror you’re expecting whatever has happened in the immediate past to continue in the future. But the recent past is a very unreliable indicator of the future. At some point, the near future won’t be a reflection of the past. Those who rely too heavily on the rearview mirror will be disappointed. Consider the road ahead for signs that may help you identify investment opportunities or pitfalls. You won’t be disappointed.
  • Be wary of solicitations from local police and firefighters. You’re likely to receive a phone solicitation to help the local police or firefighters. The first thing that may come to mind is that if you don’t send in some money, they’ll never show up in your time of need. It seems that that’s what they want you to think. The problem is that the solicitor is likely to have no affiliation with the first responders in your town and if he succeeds in separating you from some of your money, a large chunk of that money goes into the solicitor’s pocket. The Federal Trade Commission has issued a warning to consumers on this. So the next time you get a call, ask the friendly solicitors to send information on the percentage that goes for fundraising. You’ll never hear back from them …until the next time they try to tap the unsuspecting.
Food for Thought

Some regard private enterprise as if it were a predatory tiger to be shot.  Others look upon it as a cow that they can milk. Only a handful sees it for what it really is – the strong horse that pulls the whole cart.
      -Winston Churchill

Money Can Be Funny

A lawn is nature under totalitarian rule.

      -Michael Pollan

Word of the Week

grandiloquent (gran-DIL-uh-kwuh nt)  adjective – using pompous language; overblown oratory.

Origin: from Latin grandiloquus, literally “grand-speaking.” The ending was altered in English by association with eloquent.

So what if I’m grandiloquent? Life’s simply more fun that way. Not only can you find a word closer to what you really want to say, but you also get the fun of watching the faces of those from whom you’re keeping secrets.