Insurance Agent Forum

[al3]

I have several substantial CDs in Countrywide Bank. Each is structured under a different name/account such that I have FDIC protection. That much I'm sure of... but can I sleep at night?

You all read the papers and hear the news about their mortgage division. If it goes paws up, does the bank go too?

Does the FIDC really have enough money to bail out all of the depositors of CW? Is there REALLY an FDIC... or will this end up being another house of cards? Will they REALLY pay off the depositors? When? In ten years or so? We going to see a "Katrina response" to this from the Feds? Am I going to lose all my money on deposit? (I'm sure I'll lose pending interest.)

Any help you can provide will save me taking Ambian to sleep at night!!!

Al

[Newby]

Originally Posted by al3

I have several substantial CDs in Countrywide Bank. Each is structured under a different name/account such I have FDIC protection. That much I'm sure of... but can I sleep at night?

You all read the papers and hear the news about their mortgage division. If it goes paws up, does the bank go too?

Does the FIDC really have enough money to bail out all of the depositors of CW? Is there REALLY an FDIC... or will this end up being another house of cards? Will they REALLY pay off the depositors? When? In ten years or so? We going to see a "Katrina response" to this from the Feds? Am I going to lose all my money on deposit? (I'm sure I'll lose pending interest.)

Any help you can provide will save me taking Ambian to sleep at night!!!

Al

Why in the world would you have that much money in CDs?

Why wouldn't you at least put part of it in fixed annuities? I would think an A+ rated insurance company would be at least as safe as FDIC insurance and you would get a better return AND tax deferment. Plus as your own agent you would also recieve the commission.

Why in the world would any insurance agent have much money tied up in CDs. I'm not dumping on you, I just don't understand.

[senior-advisor-indiana]

That is troubling. Insurance agent investing in CD's.

[al3]

Originally Posted by Newby

Why in the world would you have that much money in CDs?

Why wouldn't you at least put part of it in fixed annuities? I would think an A+ rated insurance company would be at least as safe as FDIC insurance and you would get a better return AND tax deferment. Plus as your own agent you would also recieve the commission.

Why in the world would any insurance agent have much money tied up in CDs. I'm not dumping on you, I just don't understand.

I need the liquidity right now. Second, the funds are not in my name but in wife's. CA is a community prop. state but whatever you bring to the marriage stays yours... and this was part of her inheritance from death of a relative before we were married 26 yrs. ago. We both brought substantial assets to the marriage and have not pooled them. We're the only couple on the planet where I have my funds, she has hers, and we have some joint. Works for us (obviously) YMMV.

Al

[somarco]

Looks like Countrywide is taking steps to secure themselves from further meltdown. They drew down a line of credit ($11.5B) and are taking steps to handle all their mortgages in house.

If I had the kind of money you say you have in Countrywide CD's I wouldn't worry.

Of course, I wouldn't be selling insurance either . . .

[al3]

Originally Posted by senior-advisor-indiana

That is troubling. Insurance agent investing in CD's.

Indiana, you have one %$#*ing hell of a nerve. If you don't like how I invest, fine, but spare me your holier-than-thou lecture. I know what I'm doing, I have for 60 years now, and if you don't like it, KMA.

Al

[al3]

Originally Posted by somarco

If I had the kind of money you say you have in Countrywide CD's I wouldn't worry.

Of course, I wouldn't be selling insurance either . . .

I'm only talking about a couple of jumbos here. It's not Fort Knox!

We each have a diversified safe-money portfoio with cash in several institutions so that we might be insulated from a metldown in any one institution (or sector) and to provide so-called FDIC protection for 'nest egg' if-the-world-comes-to-an-end money.

I have a small risk-account to play the market, but most often I take the money to Tahoe and gamble it there.

My investment motto for the past 30 years has been "It does not matter how much you make... it's how much you don't lose that will determine your net-worth on any given day."

I've been through the listless stock market of the mid 70s, the decline of the early 80s, the crash in 87, the decline in 91, the dot.com blow-out in 2002, and now the sub-prime decline. I've made money and lost money. Making money is better. You make it by not losing it. YMMV.

Al

[Melmunch3]

This is some interesting reading.... Subprime ‘crisis’: FAQs | vox - Research-based policy analysis and commentary from Europe's leading economists I doubt that they will go under, but the FDIC has a lot more than would be needed to protect you.
Nevertheless, if they do go down, your liquidity may suffer a bit as it will take a while to get paid.

[CHUMPS FROM OXFORD]

Tax-exempt Bond funds (mix Intermed, ST and LT) might be a nice addition to your CD portfolio. A bit easier on the taxes and a bit more appreciation. Of course...some additional risk.

Naturally, if interest rates keep rising...well, I don't want to go there.



This post was approved by Roger Sweet.

[senior-advisor-indiana]

Originally Posted by al3

Indiana, you have one %$#*ing hell of a nerve. If you don't like how I invest, fine, but spare me your holier-than-thou lecture. I know what I'm doing, I have for 60 years now, and if you don't like it, KMA.

Al

I am offended. I am one of three that made a comment about your CD's and I am the only one that was told to KYA. DO you like my lips or is their something that I am missing? MAybe you should invest in MAC

[policy doctor]

Invest in water....stocks, partnership, whatever. It sure is liquid.

Water is drying up over the world....except Texas..our next bayou state if rain doesn't stop.

Or you can buy one of these overfunded....zero premium life policies...and in 2 years or so get a return on your investment. Buy one for you....

[Macdaddy]

Originally Posted by policy doctor

Invest in water....stocks, partnership, whatever. It sure is liquid.

Water is drying up over the world....except Texas..our next bayou state if rain doesn't stop.

Or you can buy one of these overfunded....zero premium life policies...and in 2 years or so get a return on your investment. Buy one for you....

Actually water bonds earn about 8%(Arizona water bonds come to mind). They are not very "liquid" however. No pun intended.

[Mr. Bill]

Back to the cd's and the Fed - of COURSE the Fed can bail out insured investors. As long as the mints are printing money, that is!

Take a look at what's happening in the mortgage market right now....for the Fed to intervene and provide liquidity, wow....as if the value of the dollar isn't low enough already!

[somarco]

I've been through the listless stock market of the mid 70s, the decline of the early 80s, the crash in 87, the decline in 91, the dot.com blow-out in 2002, and now the sub-prime decline. I've made money and lost money. Making money is better. You make it by not losing it.

I have been thru the same time period.

You lose money in two ways.

1) Investing in things that generate after tax returns that are less than the rate of inflation

And

2) Selling when you didn't need to sell.

When stocks (or other investments) go down you only lose if you have to liquidate. Eventually most will come back. There are exceptions of course but nothing is 100% sure fire.

People get emotionally attached to their money & their portfolio. In doing so they usually end up going backwards.

Nothing wrong with CD's, savings bonds, money market funds, or sticking your money in a mattress. All of them will prevent you from loss of principal but wont do a thing about inflation.

A balanced portfolio will serve most people well if the dollar cost average over time. The critical period is the last 5 - 8 years before retirement when you need to think about switching into more conservative investments.

I suppose I need to KYA now . . .

No thanks.

[Frank Stastny]

Here we go again!

[healthagent]

The last person in the world anyone should be taking investment advice from is insurance agents