Horizons - August 2020 · Horizons - August 2020 Planning Your Future Mauricio Giraldo Director...

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Horizons - August 2020 Planning Your Future Mauricio Giraldo Director Horizons Insurance and Financial Svcs 10620 Griffin Road -Suite 103 • Cooper City • FL • 33328 954-862-1735 • 925-588-4078 [email protected] • www.thehorizonsfinancial.com Almost Nine Out of Ten Women Qualify for Social Security on Their Own Horizons - August 2020 See disclaimer on final page Dear clients and friends, I hope this month's newsletter finds you and your families well and in good health. The COVID-19 pandemic started back in March and it has changed every aspect of our lives. The way we work, the way our kids learn, the way we interact with other people and definitely the way we travel...time will tell but most likely, we may never go back to the old normal. We have included here some interesting articles that will give you some guidance on different things that you and your family may be going through - I hope you find these useful. As always, please do not hesitate to contact us should you need any assistance with your insurance and financial matters. Have a great month of August!! Mauricio Giraldo Because of a long-term rise in the employment rate for women of all ages, the percentage of women ages 62 to 64 who are fully insured for Social Security retirement benefits based on their own work records has increased significantly since 1980. To qualify for Social Security benefits, people must work in jobs where they pay Social Security taxes and earn Social Security credits (one per quarter, up to four per year). Most people need 40 credits (the equivalent of 10 years of work) to become fully insured for Social Security retirement benefits. Source: Social Security Administration, 2020 Page 1 of 4

Transcript of Horizons - August 2020 · Horizons - August 2020 Planning Your Future Mauricio Giraldo Director...

Page 1: Horizons - August 2020 · Horizons - August 2020 Planning Your Future Mauricio Giraldo Director Horizons Insurance and Financial Svcs 10620 Griffin Road -Suite 103 • Cooper City

Horizons - August 2020Planning Your Future

Mauricio GiraldoDirectorHorizons Insurance and Financial Svcs10620 Griffin Road -Suite 103 • Cooper City • FL • 33328954-862-1735 • [email protected] • www.thehorizonsfinancial.com

Almost Nine Out of Ten Women Qualify for Social Security on Their Own

Horizons - August 2020 See disclaimer on final page

Dear clients and friends,I hope this month's newsletter finds you and your families well and in good health.The COVID-19 pandemic started back in March and it has changed every aspect of our lives. The way we work, the way our kids learn, the way we interact with other people and definitely theway we travel...time will tell but most likely, we may never go back to the old normal.We have included here some interesting articles that will give you some guidance on different things that you and your family may be going through - I hope you find these useful.As always, please do not hesitate to contact us should you need any assistance with your insurance and financial matters.Have a great month of August!!Mauricio Giraldo

Because of a long-term rise in the employment rate for women of all ages, the percentage of women ages 62 to64 who are fully insured for Social Security retirement benefits based on their own work records has increasedsignificantly since 1980.

To qualify for Social Security benefits, people must work in jobs where they pay Social Security taxes and earn SocialSecurity credits (one per quarter, up to four per year). Most people need 40 credits (the equivalent of 10 years of work) tobecome fully insured for Social Security retirement benefits.Source: Social Security Administration, 2020

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Page 2: Horizons - August 2020 · Horizons - August 2020 Planning Your Future Mauricio Giraldo Director Horizons Insurance and Financial Svcs 10620 Griffin Road -Suite 103 • Cooper City

The Changing College LandscapeThe 2020-2021 academic year is right around thecorner, and the coronavirus pandemic has upendedthe college world, like everything else. Not only hasCOVID-19 impacted short-term college operations andstudent summer plans, but the virus could end upbeing the catalyst that changes the model of highereducation in the long term. Here are some things toknow about the changing college landscape.College funds. Market volatility has been at recordhigh levels this year, and college nest eggs may havetaken a hit. Parents who have lost their jobs orotherwise suffered significant economic hardship dueto COVID-19 might reach out to their child's collegefinancial aid office to inquire about the possibility of arevised aid package, if not for fall then for spring.Parents of younger children may want to review theirrisk tolerance and time horizon for each child's collegefund. Parents who are using a 529 plan to save mayhave experienced one of the drawbacks of these plansin 2020: the restriction that allows only two investmentchanges per year on existing 529 account balances.This limitation can make it more difficult to respond tochanging market conditions.Student loan payment pause. The Coronavirus Aid,Relief, and Economic Security (CARES) Act enactedin March 2020 created a six-month automaticsuspension of student loan payments for millions offederal student loan borrowers, along with a six-monthinterest freeze. The six-month period ends onSeptember 30, 2020. Borrowers who anticipate havingtrouble restarting their monthly payments in Octobercan contact their loan servicer to inquire abouteligibility for an income-driven repayment plan.Potential refund for spring room and board.Colleges were one of the first sectors to act in theearly days of the coronavirus outbreak, askingstudents to extend their spring breaks in March andthen directing them to stay home for the rest of thesemester and finish classes online. Many collegesoffered partial refunds for room-and-board costs forMarch, April, and May, but only for students living indorms and on a college meal plan, not for off-campusstudents. If you think your son or daughter may havebeen entitled to a refund and didn't get one, contactthe college to inquire.Updated health guidelines for fall. Students headingback to college will likely find updated guidelines onsocial distancing and best practices for health andwellness, with potential restrictions on almost everyfacet of college life, including living in dorms, attendingclasses, eating in dining halls, and participating instudent activities. Some programs may be limited orunavailable, such as studying abroad. Make sure yourchild has up-to-date health insurance and knows howto contact the campus infirmary if the need arises.

Interest Rates on Federal Student LoansInterest rates on federal student loans have decreased torecord lows for the 2020-2021 academic year. The newrates apply to federal Direct and PLUS Loans disbursed July1, 2020, through June 30, 2021.

Source: U.S. Department of Education, Office of Federal Student Aid, 2020

Expanded online learning. Many colleges werealready offering online classes before the coronavirusoutbreak, but the pandemic shined a spotlight on thiscritical capability. Look for colleges to ramp up theironline course offerings and make them more widelyavailable to all students, not only during times of crisisbut as part of a typical semester's course offerings.Some colleges might even require their fall semestersto be entirely online. Students will need to continuallyembrace new technology related to remote learning.College selection. The coronavirus may have along-term impact on how students choose collegesgoing forward. Cost is likely to play an even greaterrole, as many families may have less income andsavings to put toward college expenses. This is likelyto sharpen the focus on a college's net price. Locationmay also play an outsized role. Will students choosecolleges closer to home for logistical and personalreasons? If so, look for state flagship schools tobecome even more popular, which will in turn increasetheir competitiveness.All investing involves risk, including the possible lossof principal, and there is no guarantee that anyinvestment strategy will be successful.

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Page 3: Horizons - August 2020 · Horizons - August 2020 Planning Your Future Mauricio Giraldo Director Horizons Insurance and Financial Svcs 10620 Griffin Road -Suite 103 • Cooper City

Four Things to Consider Before Refinancing Your HomeMortgage refinancing applications surged in thesecond week of March 2020, jumping by 79% — thelargest weekly increase since November 2008. As aresult, the Mortgage Bankers Association nearlydoubled its 2020 refinance originations forecast to $1.2trillion, the strongest refinance volume since 2012.1

Low mortgage interest rates have prompted manyhomeowners to think about refinancing, but there's alot to consider before filling out a loan application.1. What is your goal?Determine why you want to refinance. Is it primarily toreduce your monthly payments? Do you want toshorten your loan term to save interest and possiblypay off your mortgage earlier? Are you interested inrefinancing from one type of mortgage to another (e.g.,from an adjustable-rate mortgage to a fixed-ratemortgage)? Answering these questions will help youdetermine whether refinancing makes sense andwhich type of loan might best suit your needs.2. When should you refinance?A general guideline is not to refinance unless interestrates are at least 2% lower than the rate on yourcurrent mortgage. However, even a 1% to 1.5%differential may be worthwhile to some homeowners.To determine this, you should factor in the length oftime you plan to stay in your current home, the costsassociated with a new loan, and the amount of equityyou have in your home. Calculate your break-evenpoint (when you'll begin to save money after payingfees for closing costs). Ideally, you should be able torecover your refinancing costs within one year or less.

Rear-View Look at Mortgage RatesIn a single year, the average rate for a 30-year mortgage fell by 0.75%. Low mortgage interest rates often prompthomeowners to refinance.

Source: Freddie Mac, 2020 (data as of first week of April 2020)

While refinancing a 30-year mortgage may reduceyour monthly payments, it will start a new 30-yearperiod and may increase the total amount you mustpay off (factoring in what you have paid on yourcurrent loan). On the other hand, refinancing from a30-year to 15-year loan may increase monthlypayments but can greatly reduce the amount you payover the life of the loan.3. What are the costs?Refinancing can often save you money over the life ofyour mortgage loan, but this savings can come at aprice. Generally, you'll need to pay up-front fees.Typical costs include the application fee, appraisal fee,credit report fee, attorney/legal fees, loan originationfee, survey costs, taxes, title search, and titleinsurance. Some loans may have a prepaymentpenalty if you pay off your loan early.4. What are the steps in the process?Start by checking your credit score and history. Just asyou needed to get approval for your original homeloan, you'll need to qualify for a refinance. A highercredit score may lead to a better refinance rate.Next, shop around. Compare interest rates, loanterms, and refinancing costs offered by multiplelenders to make sure you're getting the best deal.Once you've chosen a lender, you will submit financialdocuments (such as tax returns, bank statements, andproof of homeowners insurance) and fill out anapplication. You may also be asked for additionaldocumentation or a home appraisal.1) Mortgage Bankers Association, March 11, 2020

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Page 4: Horizons - August 2020 · Horizons - August 2020 Planning Your Future Mauricio Giraldo Director Horizons Insurance and Financial Svcs 10620 Griffin Road -Suite 103 • Cooper City

Three Things to Consider Before Your Next Trip

Prepared by Broadridge Investor Communication Solutions, Inc. Copyright 2020

Horizons Insurance and Financial Services, Inc does not provide legal, tax, or variable investment advice.

The health and economic crisis created by thecoronavirus (COVID-19) pandemic will have along-lasting impact on how we all will travel goingforward. And though it may be difficult to think aboutplanning a trip during these uncertain times, here aresome things to consider if you do decide to travel.1. Check your travel provider's cancellation policy.As a result of the coronavirus pandemic, many airlinesand hotels have relaxed their cancellation policies bywaiving traditional cancellation and change fees. Thetype of reimbursements will vary, depending on yourtravel provider, but may range from full refunds tovouchers/credit for future travel. It's important tocontact your travel provider directly to find out theirindividual cancellation policies before booking.2. Be aware of travel advisories. During the height ofthe coronavirus pandemic, global travel advisorieswere at an all-time high, and domestic traveladvisories were issued for certain geographic areaswithin the United States. Your first step beforeplanning any travel should be to check the traveladvisories for your destination. Be sure to visit the U.S.Department of State website at state.gov, along withyour state and local government, for up-to-date travelwarnings.3. Read the fine print. Before you purchase a tripcancellation/interruption insurance policy, read the fineprint to determine what is specifically covered.

Typically, it will reimburse you only if you cancel yourtravel plans before you leave or cut your trip short dueto an "unforeseen event" such as illness or death of afamily member. Most policies with cancellation andinterruption coverage will exclude a "known event"such as COVID-19 once it's declared an epidemic orpandemic.If you are concerned about having to cancel or cutshort a trip due to the coronavirus pandemic, oneoption you may have is to purchase additional "cancelfor any reason" (CFAR) coverage. This is usually anadd-on benefit to certain traditional trip insurancepolicies and allows you to cancel your trip for anyreason up to a certain date before your departure(typically 48 to 72 hours) and will reimburse apercentage of your trip cost.CFAR coverage can cost quite a bit more than a basictrip cancellation/interruption policy and may haveadditional eligibility requirements. In addition, youusually have to purchase CFAR coverage soon afterpurchasing your original policy (typically within two tothree weeks).

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