Expect the Unexpected: How Life Insurance Can Actually Save Your Life

Many individuals who need to secure life insurance policies for themselves and their families neglect to do so because of the dreaded health screening. Not wanting to be gouged for higher premiums based on pre-existing health conditions that may or may not justify the price difference, many roll the dice on the financial security of their families and go without. However, very few people consider that the health screening required by most life insurance companies could actually be a blessing in disguise. Sure, the results of the testing may cause you to pay more than you wanted for life insurance, but what if the same health exam that you have been avoiding could play a role in actually improving your health, or even saving your life?

I know first hand that such a thing is possible – my husband might be dead today if we had not applied for life insurance two years ago.

When I became pregnant with our second and third children (twins) I began to press my husband to get the life insurance that he knew we both needed. We had been married for four years and had one child already, so life insurance should have been a priority long before then. However, my husband, like many others, hated the invasiveness of the required health screening, assuring himself that he was as healthy as a horse and did not need anyone trying to prove that he wasn’t. The reality was that we needed to be taken care of in case of his untimely demise, and knowing that eventually pierced his heart - we soon called a life insurance agent about policies for him and me. The application process went very smoothly; our agent was kind, helpful, and prompt. We even scheduled an in-home health screening for our convenience. Everything about this insurance company and their representatives was impressive – that is, until the nurse came to our home for the health screening.

Our first impression was positive - the nurse was friendly, professional, and surprisingly not preoccupied with trying to discover hidden illnesses or ailments that we had not disclosed. She asked some basic health questions, drew my husband’s blood, and took his blood pressure reading. The reading, however, seemed to confuse her, as if she had not been nursing for very long. Eventually she became convinced that her gauge was broken, and left to get another. Upon her return visit, she still could not figure out what was going on with the blood pressure reading and had to consult with one of the insurance company’s doctors. As a former athlete and someone who knew that he had elevated blood pressure levels in the past, my husband was surprised that this nurse could have botched such a standard procedure; no one else he had ever encountered found such a simple task to be so frustrating. Later that day we got a call from the insurance company. Their doctor advised my husband to be seen by a medical professional immediately. The nurse was no novice – she had just never seen a reading that high before and assumed there must have been a problem with the meter. My husband’s blood work proved that what she had seen was no mistake, but a crisis for an unsuspecting family.

After getting a second opinion from a local clinic, my husband rushed to the hospital for emergency care. Although he felt fine, my husband’s blood pressure was so high that the emergency room doctors were astounded; they had never seen anyone with such high numbers who was not having a stroke. One of the doctors actually asked him, “Did you walk in here?” The reason that they were so shocked was because his blood pressure had been measured consistently at approximately 290/185 – according to the American Heart Association, a normal reading for a healthy adult is a less than 120/80. My husband was immediately hospitalized and placed in the intensive care unit (ICU). Having no experience at all with hospitalization, he asked me why he was constantly being monitored by nurses and visited by different doctors. I explained to him that the ICU is where hospitals treat people who are facing extreme health deterioration and may not have much longer to live. That week he spent in the hospital was a very sobering time; it made us appreciate not only life, but the need to be prepared for the unexpected in life.

Now, after two years of consistent treatment and monitoring, we are ready to search for a life insurance provider again. My husband’s health has improved, but not so drastically that it will not negatively affect our insurance premiums. However, we are extremely thankful that the entire ordeal took place – had it not been for the life insurance company’s health exam, my husband might have lost his life. He recalls how by the time he arrived in the emergency room he had begun feeling a little light headed. Had we not applied for life insurance, that day I might have just advised him to lie down and get some rest, not knowing that he was in grievous, mortal danger.

Now I have a much more meaningful understanding of the old adage, “Expect the unexpected.” Our family can expect this: 2010 will be the year that we find a life insurance provider to suit our insurance needs, even if we have to shop around and pay slightly higher premiums than most.

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A Family Affair: How Economic Crisis Can Truly Hit Home

The state of the nation's economy is a bit enigmatic; on one hand, an 8.5% national unemployment rate still means that there is a 91.5% employment rate, so the economic outlook is obviously not all bad, despite the doom and gloom reported by the media. However, the 8.5% and those who love them are seeing some of the worst economic times facing Americans since the Great Depression. Millions of Americans are tightening their belts, but the 8.5% are losing their shirts, and when they do, many of them have to call on family and friends to help. According to the Wall Street Journal, rising costs are causing many Americans, even those with jobs, to begin moving in with family and friends, even elderly parents, just to keep their heads above water.

I ought to know; I have a sibling living with me for that very reason.

One of my sisters knows the hardships of the economic downturn, and even the dark side of financial despair. Less hours at work and an almost non-existent job market meant that she had to find other ways to make money. She lived alone and was always very independent, so she didn't like asking for help. So unfortunately, like many other Americans facing economic hardship, my sister turned to crime. She had some brushes with the law when she was young, and desperation caused her to be tempted to revert to her old ways. One minute she was living in a nice suburban townhouse, and the next she was calling to cry on my shoulder because she was losing it all. She had even taken advantage of one of our older relatives who allowed her to get a cell phone on her account. In an inside job gone bad, she ordered over 30 phones in 4 months for resale, and ended up on the hook for all of them. She was supposed to get coupons from an employee of the wireless company so that she could make a profit by buying the phones for a reduced price and selling them at close to retail. The employee stiffed her on the coupons, and she couldn't manage to save the money that was supposed to pay for the phones in the first place. So, she racked up a total wireless bill of $12,000 in someone else's name because her world was spiraling out of control. My sister does not do drugs or alcohol, and she does not have a gambling problem. She turned to fraud to pay her rent and buy groceries.

I know that many of you may find it easy to judge her and may even be eager to judge me for taking her into my home. However, the fact of the matter is that it is difficult to say what you won't do when you feel like your back is against the wall and you stand to lose everything that you have worked for. The family member sought legal advice and is working to protect herself, and my sister is going to pay the entire debt. All of it. However, she won't be able to do it alone. The problem was that she could not survive on her own with the income that she was making, so unless I wanted to see her drown, my husband and I had to step in.

For those of you who are still questioning my sanity, know that she is under strict rules living here; she has chores, my husband has to manage her income, and she cannot have a car or any company that we do not approve. We have small children, so she also babysits. Despite what you might think, the situation is actually working out. There were some tense moments and misunderstandings during the first month as we all got adjusted to the new living arrangement, but now that my sister has stopped blaming others for her circumstances, eaten a slice of humble pie, and begun to understand that we are sincerely trying to help her change her life, she has gotten with the program. It's kind of like a drug rehab, except for someone who makes poor financial decisions. It's hard enough surviving with poor decision making skills in a stable economy; when the chips are down, only the strong survive. In the absence of great mental and emotional strength and a resourceful spirit, a declining economy can ruin some of the best of us, so those who already have questionable living skills are just hardship cases just waiting to happen. However, with a little help from our friends (homage to Joe Cocker), even the worst of us can make a turnaround.

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Living Together After Divorce: It CAN work

If you've been through a divorce, you know that running into your ex-spouse can be really stressful. Some deal with that issue every day. Because of the failing economy, more and more couples are choosing not to divorce, citing the financial hardship such a move would cause. Even more couples are being forced to live together because neither one can afford to move out. I'll tell you about one such couple. My father and his second wife, Susan, have been divorced for a year, but they remain in the same home. My dad doesn't really like the situation, but he is handling it with good grace and a great measure of patience.

Susan found out before she and my father married that she has Huntington's disease, a progressive, degenerative neurological disorder. People with Huntington's often suffer from jerky, uncoordinated body movements and a decline in mental abilities. The disease itself isn't fatal, but as symptoms get worse a lot of complications can arise that both shorten life and reduce the quality of it. Knowing what he was getting into, my father chose to marry her anyway. They got along well for almost five years, until my father found out that Susan had been unfaithful. Things around their house got more and more strained, with Susan and my father fighting about everything, day in and day out.

Finally, my father had enough and he filed for divorce. The divorce was granted in January of 2008, but by then Susan's health and mental capacity had deteriorated to the point that she could not live on her own. My father couldn't afford to put her in an assisted-living facility, because he is on a fixed income and only gets $800 per month. That barely covers his mortgage payment. She has no family that is willing to help, either. He makes a little pocket money selling on eBay, but not nearly enough to afford a new residence. Basically, he's stuck between a rock and a hard place. He can't leave, but he doesn't want to stay either. Many others are in a similar situation, and here are some tidbits on couples living together after divorce:

• Many couples choose to live together after a separation or divorce for financial reasons. Perhaps one was the primary breadwinner and the other cannot afford to move out on their own, or they owe more on their home than what it's worth (otherwise known as being "upside down") and cannot find a buyer. This is especially true in today's dismal housing market. Homes that would before sell within weeks, now remain listed for months at a time, if they sell at all.
• Some couples remain together out of stubbornness. Neither one wants to concede, or be perceived as being "in the wrong", so they delay the inevitable.
• Living with an ex is usually the last resort. (as evidenced by my father's situation)
  
• Many couples who remain together after divorce are seniors living on fixed incomes, who have no family living in the area that they can depend on.
• Also, a lot of couples who have young children are electing to stay together after divorce, because they believe it's cheaper to maintain the status quo than it is to deal with child support and alimony issues.

Read a related article here, or here.

The state of the economy (such as it is) is surely contributing to the divorce rate. It's been said that money is the number one issue that couples fight over, and it's also the number one reason they divorce. If there isn't enough money to go around, and both parties are stressed out about how their bills are going to get paid, that stress and resentment will spill over into other areas of their relationship, deteriorating it.


I admire the way my father has handled the situation. He's dealing with a wife, who now has the mental and physical capacity of the average five-year old. He takes care of all her personal needs, getting up at 5 am to make sure she takes all of her medications, bathing her, dressing her, feeding her, and anything else she may need. He seems to be coping well, and is receiving a lot of support from everyone in the family. He's a Christian, and I believe that his faith in God is helping him get through this tough situation. We all get together and help him whenever he needs it, and we sit with Susan once or twice a week so that he can get out of the house. I honestly don't know how he has the discipline to do it, (Maybe his training as a Marine has something to do with it) especially as he's no longer legally obligated to do so. He told me that he does it "because I would want someone to do the same for me". I've recommended that he call the local Hospice and get them involved, even if it is just for "respite care" for Susan, so that he can have a break occasionally. He has an appointment with them on February 23rd, and I hope that they are able to help him.

Living together after divorce can happen for many reasons, and some handle it better than others. My father is a prime example of how to "make the best of a bad situation". I hope that others in a similar situation can take something from this story and apply it to their own lives. It's tricky, but it can work.

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Short Sale, Long Consequences

Short Sale

It is August 2008 and I have been divorced for two years now. What a two years it has been. Left with nearly $15,000 in credit card debt by my reckless and deceitful ex-husband, and just out of graduate school working part-time jobs to get by, it seemed like I would never catch up. Oh, and there is the deadly “foreclosure proceedings begun” on my credit report, which I’m told will be there for the next seven years. Nonetheless, it is August 2008; I am divorced, happy, and free, with a new love in my life, and more than two thirds of the debt paid off. I am able to go off the debt management program that has helped me reach this goal. I plan, and take, my first vacation in more than five years.

What do I come home to? A notice and bill from the IRS that they are increasing my 2006 reported income by more than $5,000, meaning I owe them about $800, because my ex and I sold our foreclosed house in a short sale more than two years ago.

Just when I think life is getting better, something surfaces, something bites my (thankfully, tanned) backside.

Of course, my first reaction is that this is an injustice. For one, the mortgage company (since gone bankrupt itself) never told me that I would be liable for claiming the waived debt as income, and never furnished me with a 1099 form. (In a recent phone call, their rep claimed they sent it to my ex, logical as he was the primary borrower.) For another, there is the sting of personal injustice: my ex had let the home fall into foreclosure behind my back. I still don’t know what happened to all the money that was supposedly going towards mortgage payments, thousands and thousands of dollars. (Of course, I do have my suspicions, most of which involve my ex’s internet affairs, substance abuse, and sending money to his con-artist brother in Europe for weird and always unsuccessful business ventures.)

The irony is, it was me who decided to file taxes separately for 2006, although we were technically still married for half of it, because I didn’t want to be associated with him any longer, even in the eyes of the IRS. If we’d filed jointly, he’d now be liable for half the short sale income. In fact, I might even be eligible for an IRS protection called “Innocent Spouse,” that waives the liability of a spouse when debt or income has been concealed. (He never shared the 1099.) As it is, however, two tax professionals and the IRS help desk in Providence, RI have convinced me that I am liable for the amount and will be held responsible, especially since my ex doesn’t seem to have filed income taxes at all for that year. As both of the accountants told me, “The IRS goes after the person with the deeper pockets.” It seems unimaginable but that person is me!

Ademola, another member of the www.FedPrimeRate.com Money Blog, wrote an entry about this recently. Bush and Co. have issued a special moratorium that currently prohibits taxing short sale amounts. It’s a good idea; with so many people facing foreclosure and crisis, this waiver is a welcome relief, I’m sure. After all, in my case the short sale amount, and subsequent tax, wasn’t thousands and thousands of dollars. In today’s market, however, large short sale amounts are a distinct possibility for those trying to sell their homes, especially if there’s a need to sell quickly. Read more about the moratorium here.

My story, though, is still a teaching story, I think. When you’re in financial and personal crisis, as I was when I negotiated the short sale, it’s easy to jump at the first relief without considering the long-term consequences. Don’t get me wrong, the short sale was probably still my best option, but I would have handled the taxes differently. I wish I had slowed down and asked myself questions, not yes/no questions, but open questions like: What do I need to know about a short sale?

That’s the thing about crisis: It seems like the time to act fast. Maybe, that’s really the time to slow down and do research. To ask an expert. To ask yourself: how will this affect me two years from now, when I come home from vacation, tanned, happy, and newly in love? How will this affect me when I’m almost-financially-secure again? How might this affect me in eight years or eighteen? In the moment when it’s hardest to think about long-term, we sometimes most need to.

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