Get A Clue!

A little-known insurance claim database can escalate your costs.

Most consumers-roughly 90 percent- are literally clueless when it comes to a database known as the Comprehensive Loss Underwriting Exchange (CLUE), used by insurers to determine risk for a specific home. But reality can set in a hurry when, after buying a home, your insurance is way higher than expected (or even denied) because of claims filed by previous owners.

Avoid surprises
Those claims- whether paid or not- remain in the CLUE database for seven years. When spotted by your insurer, that CLUE report can increase rates significantly. Current property owners can get one free CLUE report a year (call 866-312-8076 toll-free). To avoid surprises, ask for a report before signing a contract.

Negotiation leverage
A home with a history of claims may indicate problems that will need to be fixed. A buyer who knows about these issues may be able to negotiate a better price. But it’s also good for sellers to show a report to prospective buyers, especially is claims resulted in repairs being made.

A Safer Deposit Box

If you have jewels or special items in your safe deposit box remember they are not insured from mishaps. Those items in a bank safe deposit box are not insured by the FDIC like bank deposits.

An estimate 50,000 boxes have been burglarized or suffered flood, fire or tornado damage since 2011 with more than $11 billion in losses.

Take a look at Safe Deposit Box Insurance Coverage, a company that insures box contents.

Check out if your home owner insurance coverage may cover box contents as another route.

Protecting The Family Fortune

Parents who give away a bride or groom may have to give away a lot more if the newlyweds do not live happily ever after. Family fortunes can unravel because of a divorce, death of a child, a lawsuit or trouble with creditors.

To help protect wealth and keep it in the family:

• Review wills and testamentary provisions of revocable trusts, and consider putting money in trust for a child rather than giving it outright.
• Review beneficiary designations on IRAs, pension plans and life insurance, and consider bequeathing these assets to a trust.
• Give the newlyweds an intra-family loan to buy a home rather than providing the down payment of buying the home for them. If the couple divorces, each party will be responsible for paying back the mortgage.
• Consider leaving the assets in any trusts for which they are the beneficiaries- provided they have power of appointment- in a trust for their children.

Parents can use trusts to change their wills in a very quiet way, which can help avoid bad feelings. It’s better to use trusts for all children in a family rather than singling out black sheep, and emphasizes that a trust must be flexible to be effective. “The trust isn’t really a trap; it’s a tent of asset protection.”

Everything Down

Over the past year everything seems to be dropping in value. About a year ago the major commodities started a free fall, and then followed by gold, oil started down from over $100/barrel, and, now of late we have seen the stock markets worldwide take a swoon.

All the TV talking heads come up with wild inaccurate notions of why this is happening. They range from a slow down in China’s economy, the dollar getting stronger and a slow down in economies around the world. Baloney! Those are the symptoms of the real cause, namely, the end to quantitative easing (QE).

The fiscal policies of the Obama administration were terrible. Consequently the Federal Reserve had to step in with QE 1- QE 4. They pumped $4 Trillion into the US economy to try to give it a steroid shot. Internally there was no real growth in the economy it was a fictious smokescreen (wizard of Oz) to create the “wealth effect”. Well, this mirror program worked for a while. In fact, the Feds convinced Europe, Japan and China to do the same money thing. Consequently, a huge amount of money was sloshing around the planet. Money has to find a home! Either in bank accounts (at ¼ of 1 %), or into stocks or into real estate. Guess what? It went into stocks and real estate (commodities, art, and baseball cards), and created a growth without any fundamentals behind the asset price increase (a paper tiger)

In October 2014 the “FED” ended QE. This is the exact time that commodities across the board took a nose dive.

The drop in oil prices has little to do with supply fundamentals. The drop in commodities has little to do with deflation and over capacity. No, it is basically caused by the experiment known as quantitative easing.

Commodities and gold are down. Stocks are starting their plunge and real estate will be next.

The metaphor I can create for you is that at the “Frat” party they are giving away free booze. It is a hot party and more and more people are piling in.
Once they cut off the booze (end of the QE) everyone leaves the party and it stops.

Watch out below.


The Labor Department is considering a proposal that would bar investors from using options in individual retirement accounts.

The main premise is to protect (more nanny state influence) to buy inappropriate investments. (This administration thinks you are too stupid to make your own decisions).

This change is to take place in January 2016. True there are individuals that go out on a limb and could lose all their retirement money by taking options to an extreme (we could say the same thing to those that gamble, smoke, drink excessively etc). Options do play an excellent role in prudent investing. For instance, since the beginning of this year all our clients were hedged against a massive market drop (which has started).

None of them lost any money due to the option hedge. The strategy is a form of insurance. Next, I expect this administration to outlaw auto and homeowner’s insurance since people lose a lot in premium payments and rarely collect on that “bet”- madness. Better contact your representations if you want to keep this freedom.