Weekend reading: overcoming financial fears, creditor protection, and more

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Hi everyone and welcome to weekend reading, where we share some of the best posts we read over the past week. We hope you enjoy them as much as we did. If you haven’t already, please consider following us on TwitterFacebook, and Google+, where we share the latest in personal finance, debt, retirement, insurance, tax and investments.

Personal Finance

Roadmap2Retire teaches the importance of diversification – not in your portfolio – but in your sources of income. By diversifying your sources of income, you lower your risk since you won’t be relying on a single source of income. Even if you should lose your job unexpectedly, you will still have secondary income such as passive income from investments or active income from a part-time job.

Canadian Budget Binder advises on how to overcome financial fears. Since the world of personal finance can be confusing and full of different opinions, he advises that you consult a financial professional that you trust to guide you past your fears.

Divorce can be an extremely stressful process, and is often accompanied by the question, “Who gets what?” Sheryl at Brighter Life discusses the ramification of divorce on pension assets.

Investments

Ben at A Wealth of Common Sense gathers data on stock market corrections after long winning streaks. Double digit losses are common following a strong bull market, but the timing is difficult to determine. Just because we’ve had an extended bull market, does not mean a correction is imminent. It can happen tomorrow, or it can happen in a few years, which is why it’s important to stay invested.

The Equifax blog has four tips for young investors. You don’t need a lot of money to start investing, especially for younger investors, who haven’t had as much time as their parents to build up a large portfolio. These tips are tailored for smaller investment portfolios.

Insurance

Here at AAFS Insurance, we looked at the creditor protection offered by life insurance policies. One of the main features of a life insurance policy is the ability to name a beneficiary. By doing so, the proceeds bypass the insured’s estate and goes directly into the hands of the beneficiary, thus avoiding the claims of creditors. This can be a major planning point for many small business owners, professionals and self employed individuals.

Ellen Roseman of The Star discusses the flaws of bank’s mortgage life insurance. Because of post-claim underwriting, the insured may be paying premiums for life insurance coverage that he does not even qualify for! The banks will not verify your responses on the application, which is why they do post-claim underwriting. They’re quick to take your premiums, even if you don’t qualify, and will dissect your medical history to pieces to avoid paying a claim. It’s a business model which has given them massive profits over the years. With an individual life insurance policy, underwriting is done in advance, so that the insured can be sure his beneficiary will receive the death benefit.

Bill O’Quin of Life Happens writes about why you should consider long-term care insurance. A long-term care insurance policy helps cover the costs of services such as home nursing care and a long-term care facility.

We hope you enjoy the reads this weekend and be sure to check back next week for a new post. Subscribe to our weekly newsletter on the right side of the page so you don’t miss a single post!