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Money Matters Update November 12, 2017
Marc returns to South of the Border November 13, 2017 10:00 am PST on KVMR so TUNE IN!
This is a Brazilian edition and I haven’t hosted it for months! Tune in, tune in~
Hello and greetings!
Yes it has been a while since I posted here but no worries mates. Been taking a break and gathering new info on the markets. Let’s get caught up:
1- Turkey Matters is soon to end. Send checks to KVMR, 120 Bridge St, Nevada City, Ca 95959. I match up to $5,000.00 (percentage of your check) and follow your check with mine. Make check out to the food bank of your choice.
2- I am looking for heavy hitters to match our $1,000.00 checks to various food banks. Business owners and just plain people that can afford it will pose for a shot of all of us with $1,000.00 checks and will likely publish in the Union and all over Facebook. Contact me to be one of the heavy hitters.
3- I return to South of the Border as indicated above! Tune in.
4- Money Matters returns November 16, 2017 noon Pacific Time to talk food banks and markets! Tune in as well
5- Our “Investing in Community” video series is big hit on Facebook with videos getting literally thousands of views. We cover events, non profits and just about anything business. Contact me if you wish to be profiled and we will tell you how it works
6- New clients keep coming on board. Will you? Why not call me for a free, no obligation consult to review your portfolio? Call me personally (530) 559-1214
Now on to some great reading! Talk to you on the air!
Marc
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Medicare provides basic medical insurance to those over 65 but the free part only is what is called Medicare A and only if you or your spouse paid Medicare taxes according to the criteria. Medicare plans are labeled A through N and each letter has different benefits. As the letters go up the plans usually improve and/or cover something not covered in the previous plan letter. Pretty simple stuff actually but prior to getting my insurance licenses, quite frankly the whole Medicare thing was quite daunting and I don’t doubt many people feel the same way. The subsequent plans over the basic plans are commonly referred to as “gap” or Medigap insurance.
First off, know that all plans are federally mandated to be identical. That means no matter where you might buy a plan, they all cover same thing. But insurance companies don’t have to sell those plans for a mandated price. That means you could be paying more for the same plan depending on where you bought it. A plan bought from insurance company A could be more expensive than if you bought it from insurance company B even though it’s the same plan. So much for consumer protection from our insurance regulators.
Can plans differ drastically in price?
WeissRatings thinks so claiming “you could end up paying hundreds…even thousands.of dollars in unnecessary premiums”.
Not only are the same plans sold for different amounts, the mark up for a particular value service may be increased way beyond the actual value added by the subsequent plan.
For instance, suppose a plan decreased a fixed deductible by $180.00. The premium should be increased by that amount. But Weiss found gross and unexplainable increases.
Weiss conducted an analysis of 70,852 individual premiums nationwide and estimated insurers have marked up their premiums by unexplainable $1.2 billion. Weiss also found price differences in charges based on application questions that had no bearing on actual costs to the insurance company. In other words, insurance companies were using data that had no cause and effect to the cost of services which meant premiums should have been identical but were not.
The California Department of Insurance (CDI) provides comprehensive information on buying Medigap coverage at: http://www.insurance.ca.gov/01-consumers/105-type/95-guides/05-health/03-medsup/
They also have comparison information of which they state; “The rates are intended to give you an idea of what a Medicare Supplement Insurance policy may cost. The premium rates may vary depending on your specific Medicare Supplement Insurance needs and individual or group profile. The premium rate each company charges an individual or group is based on a number of different factors including your age, location, and the benefit plan you select. To find out more about one of these policies, call the company's consumer service telephone number included on the Medicare Supplement Insurance website for the policy plan that interests you”. The link for this information is:
https://interactive.web.insurance.ca.gov/apex_extprd/f?p=111:30
Shopping for Medicare/ Medigap insurance is not a scary as it seems once you know the resources that are available to consumers and those resources are actually fairly plentiful. The CDI is likely the first place you should start. There are also many paid services and booklets one can purchase for objective comparisons to make sure you are getting the best deal for your particular situation.
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Toys R Us became yet another retailer to go four feet up by filing reorganization and protection under Chapter 11 of the bankruptcy code late last week.
The toy retailer, which started back in 1948 with a single Washington D.C. store issued a statement by CEO David Brandon which summed up the move: “Today marks the dawn of a new era at Toys “R” Us where we expect financial constraints that have held us back will be addressed in a lasting and effective way”.
The statement illustrates both the positive and negatives in typical CEO fashion, politely indicating the company will continue on by somehow not meeting its financial obligations as originally promised. After all, that’s what chapter 11 is: renegotiating a company‘s debt while reneging on its original promises.
The company owes about 5 billion and said all of its 1600 stores would remain open going into the lucrative time of year, the holiday season, where toys under the tree boost most retailer’s balance sheets, especially the toy and gaming businesses.
The bankruptcy could indicate the rapidly changing retail landscape brought about by online competition. It wasn’t so long ago when Toys “R” Us bought out competitors FAO Schwartz and KB Toys, only to succumb to its debt load which obviously increased by such acquisitions.
Commentary from Forbes and new965.com indicate the obvious: pressure from online retails are causing tsunamis in traditional retail company balance sheets as consumers elect to buy from the comfort of their home instead of taking an arduous trip to the mall.
Other companies who have suffered similar fates include shoe store Payless and Gymboree, the children’s clothing outlet.
Highlighted in previous Money Matters articles entitled “Online Retail Wipe Out”
11/2017, “Another Retail Wipe Out” 12/2017 and Money Matters Show #138 entitled Retail Wipe Out, 2/2012, the pressure from other methods of shopping becoming available with the advent of the internet is becoming prevalent and mainstream. Toys “R” Us said as much in a comment at the time of filing which said it had to improve its online services and enhance the store experience (new965) which is a fancy way of saying they have to get better in the online market place while adding more value and therefore a reason for shoppers to get out of their chairs and drive to a store.
Meanwhile online goliath Amazon continues to cause havoc in the retail environment by making the shopping environment of a comfy chair at home with credit card in hand in front of a computer more desirable and less hassle then getting into a car only to spend hours parking, fighting crowds, and struggling with shopping bags. Added features such as free shipping programs and hassle free returns make a strong case for the staying home with a cup of coffee and comparing hundreds of prices in microseconds. Online reviews further enhance the experience.
Although Toys “R” Us will survive for now, the reverberations from its reorganization could cause additional damage to related sectors as 5 billion in debts are restructured. No doubt Toys “R” Us won’t be last retailer to hoist the white flag and cry uncle under the weight of a rapidly changing environment caused by a shift in shopping methodology brought on by an expanding internet.
