Investment & Insurance Planning Services, LLC
Certified FInancial PLanner ™
David J. Blount, CERTIFIED FINANCIAL PLANNER™ founded Investment & Insurance Planning Services, LLC in 2005. David earned one of the most respected financial planning designations, CFP® , in 2007, allowing him to provide a broad range of financial advice. Prior to founding his own company, he worked for Calton & Associates and The MONY Group. While companies and markets may fluctuate, David’s values are steadfast. He values providing straight-forward advice, integrity, professionalism, honesty, and responsive service. He believes that getting to know the person and building trust in an advisory relationship is the key to meeting client satisfaction.
At Investment & Insurance Planning Services, LLC, we believe that you should enjoy your health, wealth and time by doing the things that inspire you. Our client commitment is to provide great service and advice that’s consistent with your individual financial goals. We strive to help our clients find sound financial strategies that enable them to pursue and protect what's most important. Furthermore, we utilize our skills in retirement, investment, estate and insurance planning to help clients solve the financial complexities of making a life-change or adjusting to new circumstances.
David completed his undergraduate studies at Troy State University, where he graduated Summa Cum Laude with a Bachelors in Arts & Sciences. Prior to that he spent 9 years in the United States Coast Guard where he participated in the aids to navigation, maritime law enforcement and search & rescue missions. He earned a number of military awards and recognitions during his time in the service. David has served as the guest financial expert on Orange Televisions Adult Lifestyle Magazine Show and currently serves as the Vice President for Seminole Health & Human Services Network and ELITE Networking groups. David also volunteers his time with the Hook Kids on Fishing programs and is active at Northland Church. When not working, David enjoys fishing and spending time with his wife, Michelle, and their two children, Ryan and Alana.
BS, Psychology, Troy State University
Registered Representative of The O.N. Equity Sales Company, Member FINRA/SIPC. One Financial Way, Cincinnati, OH 45242 (513)794-6794. Investment Advisory Services offered through O.N. Investment Management Company.
Contact your registered representative to obtain current prospectuses. Please read the prospectus carefully before you invest or send money. Investors should consider the investment objectives, strategies, risk factors, charges and expenses of the underlying variable portfolios carefully before investing.
Guarantees are based upon the claims-paying ability of the issuing insurance company.
As with any investment, investing in variable portfolios involves risk, including possible loss of principal. Past performance is no guarantee of future results.
Typically no, however, some 401k plans may permit the 401k custodian to rollover a 401k account to an IRA if you're no longer employed and the account value is under a certain amount. For example, if XYZ company handles your 401k plan then the governing plan document for your company's plan may allow XYZ to move the 401k account into an XYZ IRA. This is sometimes allowed so that the custodian can clear smaller 401k accounts out of the plan. But I don't think it would ever allow for your 401k at XYZ to be rolled over into another broker dealer's IRA. If this rollover was permitted by the pan document then you should have received ample notification from the 401k custodian before any such transfers were processed.
Definitely "no" regarding the broker dealer permitting your husband to initiate a rollover. This couldn't happen without someone forging your signatures on the account documents. One caveat would be if you had passed away then of course he would be permitted to roll the 401k into his own IRA. So yes, this does sound like a securities violation and you should make further inquiries to see exactly what happened, file a complaint if your money was mishandled and take further legal action as you see necessary.
First of all please accept my condolences. I’m sorry for your loss.
Further to your question, once a policy is issued, the first premium is paid, and all delivery requirements are signed, the policy is in full force and effect. There are many instances where an insured died the day the premium was paid and the carrier paid the claim, as they must.
However, all life insurance policies have a two-year contestable period. During this time the carrier may ‘contest’ the claim and deny payment if there has been a “material misrepresentation” of facts. Some examples would include non-disclosure of health issues such as tobacco use, etc. Furthermore, suicide is an exclusion if occurring in the first two policy years. Thereafter these issues are, generally speaking, non-contestable.
It’s possible that the carrier has not denied the claim so much as they are investigating the circumstances. That is not unusual. During this time the carrier will perform a thorough evaluation of all facts. Presupposing there are no adverse findings, the claim should be paid.
If the claim is denied, you’re entitled to an explanation. In today’s information age, it is difficult for a proposed insured to ‘hide’ any adverse history. If the claim is denied, and depending on the size of the claim, you may consider hiring an attorney experienced in these matters.
Next steps for you should be to confirm if they have in fact denied the claim or are still investigating it in accordance with the contestability clause in your uncle’s life insurance contract. If they’re contesting the claim, then I encourage you to be vigilant in staying informed and patient with the process. If the claim was denied, then obtain a detailed explanation of the reasons for denial. If you disagree with their decision, then see if you can appeal it and or consult with an attorney competent in these matters.
Thank you for the question and I sure hope that in the end this works out in your favor. To conclude I’d like to encourage other readers who are considering buying life insurance with the following story.
I had a client a few years ago apply for life insurance, and during the application process told me she did not want to disclose a particular lifestyle choice. I counseled disclosure explaining the contestability period and that her application would be shopped until adequate coverage for an acceptable premium was found. Not all carriers look at all issues of health or lifestyle in the same way. Part of an agent’s task is to advocate for the client and find the best fit for both the client and the insurance company.
She took my advice, answered all of the questions truthfully and accurately, and bought the coverage offered. The insurance company issued the policy as applied for. However, within the two-year contestability period she passed away. The insurance company “contested” the claim and sure took their time looking into the coroner’s report, medical records, blood tests, media etc.…and paid the policy in full.
The point: it’s very important to disclose everything in an insurance application to avoid claim denial.
Many people want to avoid certain questions on the application to save money on premiums and keep it out of their records. For example, tobacco and recreational drug use are often not admitted. However, this creates a potential claim risk and unintended consequences to surviving family members.
Congrats on your decision to make retirement saving a priority! You're on your way to becoming a millionaire if you maintain this same discipline throughout your working years.
Here are some differences between the 401k and SIMPLE IRA.
SIMPLE: for employers with less than 100 employees, employees can contribute $12,500 per year plus $3,000 catch-up if over 50, the IRA’s are held with one fund company so you can only pick their funds, employers have some flexibility with regard to the matching percentage during lean years, employees are 100% immediately vested, no government testing or IRS filings required for the plan therefore complexity and admin costs for the employer are low.
401(k)- any size employer can implement a 401k plan, employees can contribute $18,000 per year plus $6,000 catch-up if over 50, typically have investments available from many companies, employers can add a profit sharing component, typically matching percentage is fixed, employees are 100% vested for their contributions, a vesting schedule may be added for matching and profit sharing contributions from the employer, ERISA testing and IRS filings are required therefore employer costs and plan complexity are higher.
Regarding rolling it over or keeping it where it is I’d add the following…
- If you’re unhappy with the SIMPLE then you can transfer it to a Traditional IRA with another custodian and implement an investment strategy of your choice.
- Your SIMPLE IRA is probably with a mutual fund company and you're only allowed to purchase shares of that company's funds. If you like the funds you own because they are doing well, diversified according to your risk tolerance and the fees are reasonable then you can leave that IRA as it is. But avoid contributing any more money to the SIMPLE while contributing to the 401k because it can get complicated.
- If your employer permits, you can roll the SIMPLE IRA into your new 401k account. I'd only do this if you’re happy with the fund choices that are available in the new 401k with regard to performance, diversification and fee’s. This may also provide an opportunity to borrow against these funds if an emergency arises whereas the SIMPLE won’t allow that service.
- Another option would be to convert the SIMPLE IRA to a Roth IRA. You’d have to pay taxes on the conversion based upon your current income tax rate. You can contribute to the Roth if your modified adjusted gross income is under $116,000 and filing single. You can even add money to the Roth while investing in your 401k.
Hope this helps and best wishes!
Thank you for the question and here are a few thoughts regarding your options. If you need the income to help with living expenses, then you could have those dividends direct deposited into your checking or savings account. Be careful if you're under 59 1/2 and it's a qualified account (IRA, 401K, 403B etc.) because you'll owe taxes and penalties. If you don't need the dividends, then reinvesting those may be the best choice depending upon your circumstances. I'd be comfortable reinvesting those into the same stock if the reason you bought the stock is still sound and you consider it to be a good long-term investment. However, if the stock has appreciated significantly to the extent that it could be overvalued, then consider reinvesting into another stock with a more attractive valuation and upside potential.
Great question! No you wouldn't be able to buy life insurance inside your 401k plan. And it's not advisable to take a withdrawal from the 401k to pay the life insurance premium either due to the taxes and potential penalties you would owe the IRS. For example, if you're in the 25% tax bracket and withdraw $10,000 for the annual life insurance premium, then you would owe the IRS approx. $2,500 in taxes. Plus if you're under 59 1/2 then you owe them another 10% early withdrawal penalty for a total of $3,500! In addition, your 401k plan may not allow a withdrawal for anything other than hardships. After tax money is the best way to pay for life insurance premiums. Thank you for the question and best wishes!