Benefits of Consuming Dark Chocolate and Cacao

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Dark chocolate can lower stress, inflammation and improve memory

Consuming dark chocolate and/or cacao has several benefits to brain function, including reducing stress levels and inflammation, and improving mood, memory and immunity, according to two studies. The natural stuff in dark chocolate and cacao is chock-full of ingredients called flavanols, antioxidant compounds found in cocoa beans.

Researchers at Loma Linda University Adventist Health Sciences Center in Southern California studied how consumption of dark chocolate with a high concentration of cacao — at least 80 percent — has positive health benefits and effects.

Tests revealed that dark chocolate or cacao can stimulate the body to produce nitric oxide. Nitric oxide relaxes blood vessels to allow an increased flow of blood and oxygen to the heart, brain, and other organs of the body.

In the past, research has shown that cacao is a major source of flavonoids. Because they are extremely potent antioxidants and anti-inflammatory agents, flavonoids benefit brain and cardiovascular health, the researchers said.

“For years, we have looked at the influence of dark chocolate on neurological functions from the standpoint of sugar content — the more sugar, the happier we are,” Dr. Lee S. Berk, associate dean of research affairs at Loma Linda and principal investigator on both studies, said in a press release. “This is the first time that we have looked at the impact of large amounts of cacao in doses as small as a regular-sized chocolate bar in humans over short or long periods of time, and are encouraged by the findings.”

Tests have found that the equivalent of four cups of flavanol-rich cocoa dramatically increased blood flow to the arms and fingers of people after only four days. Such an increase can help people fighting diseases ranging from high blood pressure, hardening of arteries, and stroke to diabetes, vascular dementia, and preeclampsia, a serious condition that affects pregnant women.

 

References:

  1. https://www.upi.com/Health_News/2018/04/25/Studies-Dark-chocolate-can-lower-stress-and-inflammation-improve-memory/3201524661285/
  2. https://news.harvard.edu/gazette/story/2007/02/cocoa-shows-promise-as-next-wonder-drug/

Anti-Aging Laboratory Breakthroughs

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In Boston labs, experiments have shown that aging is a reversible process, capable of being driven “forwards and backwards at will,” said anti-aging expert David Sinclair, a professor of genetics in the Blavatnik Institute at Harvard Medical School and codirector of the Paul F. Glenn Center for Biology of Aging Research.

“Our bodies hold a backup copy of our youth that can be triggered to regenerate”, said Sinclair, the senior author of a new paper showcasing the work of his lab and international scientists.

The combined experiments, published in the journal Cell, challenge the scientific belief aging is the result of genetic mutations that undermine our DNA, creating a junkyard of damaged cellular tissue that can lead to deterioration, disease and death.

“It’s not junk, it’s not damage that causes us to get old,” said Sinclair. “We believe it’s a loss of information — a loss in the cell’s ability to read its original DNA so it forgets how to function — in much the same way an old computer may develop corrupted software. I call it the information theory of aging.”

Epigenetic changes control aging

While DNA can be viewed as the body’s hardware, the epigenome is the software, writes CNN Health. Epigenes are proteins and chemicals that sit like freckles on each gene, waiting to tell the gene “what to do, where to do it, and when to do it,” according to the National Human Genome Research Institute.

The epigenome literally turns genes on and off. That process can be triggered by pollution, environmental toxins and human behaviors such as smoking, eating an inflammatory diet or suffering a chronic lack of sleep. And just like a computer, the cellular process becomes corrupted as more DNA is broken or damaged, Fr. Sinclair said.

“The cell panics, and proteins that normally would control the genes get distracted by having to go and repair the DNA,” he explained. “Then they don’t all find their way back to where they started, so over time it’s like a Ping-Pong match, where the balls end up all over the floor.”

In other words, the cellular pieces lose their way home, much like a person with Alzheimer’s.

“The astonishing finding is that there’s a backup copy of the software in the body that you can reset,” Sinclair said. “We’re showing why that software gets corrupted and how we can reboot the system by tapping into a reset switch that restores the cell’s ability to read the genome correctly again, as if it was young.”

It doesn’t matter if the body is 50 or 75, healthy or wracked with disease, Sinclair said. Once that process has been triggered, “the body will then remember how to regenerate and will be young again, even if you’re already old and have an illness. Now, what that software is, we don’t know yet. At this point, we just know that we can flip the switch.”

To prove the theory and with the help of other scientists, Sinclair and his Harvard team have been able to age tissues in the brain, eyes, muscle, skin and kidneys of mice.

To do this, Sinclair’s team developed ICE, short for inducible changes to the epigenome. Instead of altering the coding sections of the mice’s DNA that can trigger mutations, ICE alters the way DNA is folded. The temporary, fast-healing cuts made by ICE mimic the daily damage from chemicals, sunlight and the like that contribute to aging.

In his lab, Sinclair said his team has reset the cells in mice multiple times, showing that aging can be reversed more than once, and he is currently testing the genetic reset in primates. But decades could pass before any anti-aging clinical trials in humans begin, get analyzed and, if safe and successful, scaled to the mass needed for federal approval.

Here’s how to eat to live longer, new study says

But just as damaging factors can disrupt the epigenome, healthy behaviors can repair it, Sinclair said.

“We know this is probably true because people who have lived a healthy lifestyle have less biological age than those who have done the opposite,” he said.

His top tips? Focus on plants for food, eat less often, get sufficient sleep, lose your breath for 10 minutes three times a week by exercising to maintain your muscle mass, don’t sweat the small stuff and have a good social group.

References:

  1. https://edition.cnn.com/2023/01/12/health/reversing-aging-scn-wellness/index.html

Dietary Fat is Health Food

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“Nothing beats the true healing power of food and food is the best medicine for chronic disease.  It works faster and better, and is cheaper than medication. And all the side effects are good ones.”  ~ Dr. Mark Hyman

Many Americans have long been told that consuming dietary fat makes them fat, contributes to heart disease, and generally erodes their health. Now a growing body of research debunks long held beliefs about dietary fat, revealing the immense health and weight-loss benefits of a high-fat diet rich in eggs, nuts, oils, avocados, and other delicious superfoods, explains Dr. Mark Hyman, M.D., author of “Eat Fat, Get Thin” and director of the Cleveland Clinic Center for Functional Medicine, and founder and director of The Ultra-Wellness Center.

We now know that refined sugars and ultra process carbs, not fat, are the true causes and villains of obesity and heart disease. Overconsumption of refined sugars and processes carbohydrates causes a spike in the body’s production of the hormone insulin, which increases the storage of fat, especially dangerous visceral fat, explains Dr. Hyman. Instead, consuming healthy fats and plant based food, which are packed with powerful antioxidants and photochemicals is what your body and mind need.

Fat is one of the body’s most basic building blocks. The average person is made up of between 15 and 30 percent fat!

Essentially, dietary fat does not cause a spike in insulin.  Unlike eating refined sugars and processed carbs, eating fat makes your body burn fat, rather than store fat. Fats like butter and coconut oil boost your body’s metabolism, suppress hunger, lower triglycerides, reduce fat storage, and even improve athletic performance.

By increasing dietary fat into your diet, and eliminating sugar and process carbs, studies demonstrate that you can lose more weight, improve your metabolic health, and begin to feel and look better.

“Dr. Mark Hyman has helped thousands of people lose weight and lead happier, more energetic lives,” writes Toby Cosgrove, CEO of Cleveland Clinic. “His powerful insights on the dynamics of dietary fat will change the way you think about everyday eating, and show you how easy it is to enjoy a healthier, more satisfying diet.”

In short, the right fats can improve your mood, skin, hair and nails, while protecting you against Type 2 diabetes, dementia, cancer and much more, according to Dr. Hyman. Among his favorite sources of fat include:

  • Avocados.
  • Nuts—walnuts, almonds, pecans, macadamia nuts, but not peanuts (one study showed a handful of nuts a day reduced death from all causes by 20 percent).
  • Seeds—pumpkin, sesame, chia, hemp.
  • Fatty fish, including sardines, mackerel, herring and wild salmon that are rich in omega-3 fats.
  • Extra virgin olive oil (a large study showed that those who consumed 1 liter a week reduced heart attacks by 30 percent).
  • Grass-fed or sustainably raised animal products.
  • Extra virgin coconut butter, which is a great plant-based source of saturated fat that has many benefits. It fuels your mitochondria, is anti-inflammatory and doesn’t cause problems with your cholesterol. In fact, it may help resolve them.

References:

  1. Dr. Mark Hyman, Eat Fat, Get Thin, Little, Brown and Company. February 23, 2016.
  2. https://www.ecowatch.com/dr-mark-hyman-10-reasons-why-you-should-eat-fat-to-get-thin-1882141535.html

Dark Chocolate (Cacao) and Stem Cell Regeneration

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Dark chocolate (or cacao) is the number one longevity food on earth. 

According to researchers, “The raw cacao bean is one of nature’s most fantastic superfoods due to its mineral content and wide array of unique properties.” And according to Dr. Li, dark chocolate or cacao is one of the best foods for improving the stem cell response inside your body.

Dark chocolate, containing 70 to 80 percent cacao or higher or its more processed cousin cocoa, is rich in polyphenols, antioxidants that help protect from disease-causing free radicals. Cacao is also rich in magnesium, which helps our minds and bodies to relax.

Dr. Li specifically mentions drink two cups of dark, hot chocolate as the best way to get your daily dose of cacao, which can actually double the number of stem cells flowing in your bloodstream at any given time.

Dark chocolate containing 70 to 80 percent cacao or higher is packed with nutrients that can strengthen your body’s defense systems and positively affect your overall health.

Dark Chocolate is Heart Healthy

You may have heard this benefit before—and it continues to ring true through vast research today. Epidemiologists have long-established a connection between consuming foods with flavanols—a potent antioxidant found in dark chocolate—and a lower incidence of death from cardiovascular disease.

With the help of over 750 million stem cells, your body regenerates itself each and every day. Dark chocolate can mobilize your stem cells to carry out their job to the fullest. At the University of California, San Francisco, researchers found that participants who received a chocolate drink made with cocoa twice a day for thirty days had twice as many stem cells in their circulation as their control group.

References:

  1. https://www.vosgeschocolate.com/blogs/vosges-haut-chocolat-blog/guest-post-7-pleasantly-surprising-health-benefits-of-dark-chocolate
  2. https://althealthworks.com/holistic-doctor-shares-this-ancient-healing-food-helps-your-body-recruit-stem-cells-to-regenerate-itself-from-the-inside-out/

Small Cap Stocks Performance

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Historically, small-cap stocks have been shown to outperform the rest of the market over the long term.  And, small-caps tend to underperform during bear markets but outperform in bull markets.

Some of the best stocks to buy in the past 25 years started as small-cap stocks. Amazon was a $7 stock in 1998, and Tesla had a market valuation of just over $1 billion in 2010. Of course, not every small-cap company becomes a giant. Investing in small companies can be rewarding, but it also comes with risks that investors need to understand.

Over the long-term, small caps tend to outperform because of greater growth opportunities. A massive company is limited by its existing size. It’d be exceptionally difficult for, say, Apple Inc. to triple its revenues and free cash flow anytime soon.

However, a $1 billion company can much more easily grow to be multiples of its current size. Many small caps stay small because they have structural problems, management lacks the capability to grow the business, or their niche simply isn’t large enough to support a bigger enterprise. That said, many small caps can graduate to greater things, earning shareholders tremendous returns along the way.

Small-cap stocks tend to experience more price volatility and to suffer more stock price destruction than their larger cap peers during bear markets and when equities are broadly struggling due to inflationary and recessionary fears.

Small cap stocks typically underperform entering recessions and periods of economic weakness but outperforms coming out of them. In the long run, small caps tend to be winning investments. Yale professor Roger Ibbotson and financial consultancy Duff & Phelps analyzed nearly a century of data to find that small caps have outperformed large companies by 1.6% on average every year through 2020.

Fearful investors who throw in the towel during market downturns risk missing out on the rewards when the market possibly reverses course in 2023.

“This is one of the best times to invest in small company stocks that we’ve seen in a very long period of time,” says Gregg Fisher, founder of global small cap hedge fund Quent Capital, which manages $1 billion in assets. “The odds historically of a huge rally off this massive decline are high.”

The small-cap benchmark Russell 2000 Index (RUT) generated a total return (price appreciation plus dividends) of -20.4% for the year-to-date through Dec. 16. That trailed the S&P 500’s (SPX) total return of -17.9%.

No surprises there. Risker and “growthier” equities such as small-cap stocks tend to underperform when markets are volatile and headed south (bearish).

By the same token, however, small-cap stocks also tend to outperform the broader market when equities are catching a bid. No one can know for certain if we’ve already seen the bottom of our current bear market. Once the equity malaise lifts, however, the best small-cap stocks to buy should theoretically be among the market’s top outperformers.

To find the best performing small cap that have continued to grow through the bear market, Search for companies with a market value between $300 million and $2 billion that also had positive sales growth over the past 12 months and a share price of at least $5. Financial institutions, REITs, utilities, royalty trusts and limited partnerships were excluded, as were companies that have been public for less than one year.

Over time, small-cap stock prices tend to be more volatile than those of larger companies, and stock values fluctuate more dramatically. But, in general, the longer the evaluation period, the greater the likelihood that small-cap stocks outperform the large-caps.

in recent months small-cap stocks have fallen sharply amid a broader pullback on fears of a Federal Reserve Board rate hike, especially in high-priced growth stocks. Since small-cap stocks are more likely to be in their growth phase and are often unprofitable or minimally profitable, they get hit harder during “risk-off” moments like the one that started 2022. In other words, small-caps tend to underperform during bear markets but outperform in bull markets.

References:

  1. https://www.fidelity.com/insights/investing-ideas/small-caps-2023
  2. https://www.forbes.com/lists/best-small-cap-companies
  3. https://money.usnews.com/investing/slideshows/9-of-the-best-small-cap-stocks-to-buy-for-2023
  4. https://www.fool.com/investing/stock-market/types-of-stocks/small-cap-stocks/
  5. https://www.fool.com/investing/stock-market/types-of-stocks/small-cap-stocks/how-to-find-small-cap-stocks/

10 Key Concepts About Money, Wealth and Financial Freedom

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Brian Feroldi — financial advisor, YouTuber and author — posted on Twitter the key lessons he learned from the10 people that permanently changed the way he thought about money, wealth and financial independence:

  1. Financial independence is achievable if you hyper-focus on your savings rate.
    “Your time to reach financial independence depends only on one factor:  your savings rate as a percentage of your take-home pay.” ~ Pete Adeney
  2. Income and wealth are not the same things.
    “People who look rich may not actually be wealthy. Income does not equal wealth.” ~ Dr. Thomas Stanley, The Millionaire Next Door
  3. Putting what goods and services really cost in proper perspective.
    “The true price of anything is the amount of life you sold to buy it.” ~ Vicki Robbins
  4. Saving more money is more powerful and beneficial than making more income.
    “One dollar save is two dollars earned.” ~ David Chilton
  5. Your mind and mindset can be your greatest asset or your greatest liability.
    “Thoughts are powerful. Your mind is the one thing that can stop you in your tracks, or propel you to financial success.” ~ Napoleon Hill
  6. Money’s true highest purpose and benefit…financial independence and freedom.
    “Money’s greatest intrinsic value — and this cannot be overstated — is the ability to give you control over your time.” ~ Morgan Housel
  7. All spending is not created equally. Spend with purpose and according to your values. 
    “Spend extravagantly on the things you love, and cut costs mercilessly on the thing you don’t.” – Ramit Sethi
  8. Every financial decision you make involves a tradeoff and has an opportunity cost.
    “You can afford anything, but not everything. Every financial choice you make is a trade off against something else.” ~ Paula Pant
  9. There’s an optimal time to have positive life experiences. Don’t over-save and under spend on positive life experiences.
    “With each year that passes, our ability to convert dollars into positive life experiences decline over time.” ~ Bill Perkins
  10. Think like an entrepreneur, not a consumer. Buy assets with your personal capital that produce income and appreciate in value; and avoid personal liabilities and consumer debt.
    “Instead of taking a class, offer a class. Instead of borrowing money, lend it. Instead of taking a job, hire for jobs. Instead of taking a mortgage, hold a mortgage. Break free from consumption, switch sides, and reorient to the world as producer.” ~ MJ Demarco

Source: Twitter

Federal Spending and U.S. National Debt

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In response to the COVID-19 pandemic, more than 50% of increased federal government spending between 2019 and 2021 was for assistance to individuals, which more than tripled to $1.1 trillion in 2020 and increased by another $300 billion in 2021, according to USAFacts.

In fiscal year 2021, the federal government spent 68% more than it collected, resulting in a $2.8 trillion deficit. The deficit decreased from fiscal year 2020 when the federal government spent 91% more than it collected.

Most federal government spending happens in two ways:

  • Direct spending on federal programs (such as for the military and social security) and
  • Indirect spending through transfers to state and local governments in the form of grants (such as for infrastructure) that those governments then spend. State and local governments raise money both through federal grants and revenue raised through state and local revenue sources.

Source:  USAFacts

The National Debt Limit

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More than half of the U.S. National Debt is owed to the US public and more than one quarter is owed to foreign entities.

The debt limit, or debt ceiling, is a restriction on how much the federal government can borrow to pay its bills and allocate funds for future investments.

When Congress appropriates or directs government money to be spent, the government is obligated to pay those funds, creating a bill it must pay. The federal government spent 68% more than it collected in fiscal year 2021, resulting in a $2.8 trillion deficit. The deficit decreased from fiscal year 2020 when the federal government spent 91% more than it collected, according to USAFacts.

This bill, also known as the national debt, is the amount of money the federal government has already borrowed to cover outstanding expenses in past fiscal years.

The national debt is composed of debt held by the public in the form of government securities and intragovernmental debt, debt which one part of the federal government owes to another.

The U.S. Gross Domestic Product in December 2022 was $26.13 trillion, according to the Bureau of Economic Analysis. The Gross domestic product (GDP) is the value of all goods and services produced in the US. This number is used to measure the health of the economy by observing when GDP is growing or shrinking.

The U.S. National Debt ceiling is currently set at $31.4 trillion.

In December 2021, Congress increased the debt ceiling to $31.38 trillion.

When the national debt exceeds the debt ceiling, the federal government cannot increase its outstanding debt any further. Therefore, the Treasury Department can use extraordinary measures authorized by Congress to manage the federal government’s finances and remain under the debt limit.

These measures can include suspending investments into government saving, retirement, and health plans, halting the sale of Treasury bonds and other government securities, or shifting money between government agencies to pay off intragovernmental debts.

Source:  USAFacts.

Charles Schwab’s Five Steps to Financial Fitness

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Below are five steps financial firm Charles Schwab encourages all investors to consider taking to boost their financial fitness at any time of the year.

Resolution 1: Create a budget

Committing to a saving and investing program during your working years is generally the best way to boost your net worth and achieve many of life’s most important goals. Of course, first you’ll need to know how much money you’ve got to work with. That’s where a budget and net worth statement can help. Here’s how to think about them.

  • Budget and save. At a minimum, be sure to have a high-level budget with three things: how much you’re taking in after taxes, how much you’re spending, and how much you’re saving. If you’re not sure where your money is going, track your spending using a spreadsheet or an online budgeting tool for 30 days. Determine how much money you need to cover your fixed monthly expenses, such as your rent or mortgage and other living expenses, and how much you’d like to put away for other goals. For retirement, our rule of thumb is to save 10%–15% of pre-tax income, including any match from an employer, starting in your 20s. If you delay, the amount you may need to save goes up. Add 10% for every decade you delay saving for retirement. Once you commit to an amount, consider ways you can save automatically, such as through monthly direct deposits.
  • Calculate your personal net worth annually. It doesn’t have to be complicated. Make a list of your assets (what you own) and subtract your liabilities (what you owe). Subtract the liabilities from the assets to determine your net worth. Don’t panic if your net worth declines when the market is struggling. What’s important is to see a general upward trend over your earning years. If you’re retired, you’ll want to plan an income and distribution strategy to help make your savings last as long as necessary and support other objectives.
  • Project the cost of essential big-ticket items. If you have a big expense in the near term, like college tuition or roof repair, put the money aside or increase your savings and treat that money as spent. If you know that you’ll need the money within a few years, keep it in relatively liquid, safe investments like short-term certificates of deposit (CDs), a savings account, or money market funds purchased within a brokerage account. If you choose to invest in a CD, make sure the term ends by the time you need the cash. If you have more than a few years, invest wisely, based on your time horizon.
  • Prepare for emergencies. If you aren’t retired, we suggest creating an emergency fund with three to six months’ worth of essential living expenses, set aside in a savings account. The emergency fund can help you cover unexpected but necessary expenses without having to sell more volatile investments.
  • Retired? Invest your living-expense money conservatively. Consider keeping 12 months of living expenses—after accounting for non-portfolio income sources like Social Security or a pension—in short-term CDs, an interest-bearing savings account, or a money market fund. Then consider keeping another two to four years’ worth of spending laddered in short-term bonds or invested in short-term bond funds as part of your portfolio’s fixed income allocation. You can use this money to cover expenses in the near term. Having a chunk of savings invested conservatively should allow you to invest a portion of your remaining savings for growth, at a level of risk appropriate for you, while reducing the chances you’ll be forced to sell more volatile investments (like stocks) in a down market.

Resolution 2: Manage your debt

Debt is neither inherently good nor bad—it’s simply a tool. It all depends on how you use it. For most people, some level of debt is a practical necessity, especially to purchase an expensive long-term asset to pay back over time, such as a home. However, problems arise when debt becomes more of a burden than a tool. Here’s how to stay in control.

  • Keep your total debt load manageable. Don’t confuse what you can borrow with what you should borrow. Keep the monthly costs of owning a home (principal, interest, taxes, and insurance) below 28% of your pre-tax income, and your total monthly debt payments (including credit cards, auto loans, and mortgage payments) below 36% of your pre-tax income.
  • Eliminate high-cost, non-deductible consumer debt. Try to pay off credit-card debt and avoid borrowing to buy depreciating assets, such as cars. The cost of consumer debt adds up quickly if you carry a balance. Consider consolidating your debt in a low-rate home equity loan or line of credit (HELOC), set a realistic budget, and implement a schedule to pay it back.
  • Match repayment terms to your time horizons. If you’re likely to move within five to seven years, you could consider a shorter-maturity loan or an adjustable-rate mortgage (ARM), depending on current mortgage rates and options. Don’t consider this if you think you may live in your home for longer or struggle to manage mortgage payment resets if interest rates or your plans change. We also don’t suggest that you borrow money under the assumption that your home will automatically increase in value. Historically, long-term home appreciation has significantly lagged the total return of a diversified stock portfolio. And, for any type of debt, have a disciplined payback schedule. Create a plan to pay off the mortgage on your primary home before you plan to retire.

Resolution 3: Optimize your portfolio

We all share the goal of getting better investment results. But research shows that it’s extremely difficult to always invest at the “perfect” time. So, create a plan that will help you stay disciplined in all kinds of markets. Follow your plan and adjust it as needed. Here are ideas to help you stay focused on your goals.

  • Focus on your overall investment mix. After committing to a savings plan, how you invest is your next most important decision. Have a targeted asset allocation—that is, strategically proportioned mix of stocks, bonds, and cash in your portfolio—that you’re comfortable with, even in a down market. Make sure it fits your long-term goals, risk tolerance, and time frame. The longer your time horizon, the more time you’ll have to potentially benefit from up or down markets.
  • Diversify across and within asset classes. Diversification can help reduce risk and can be a critical factor in helping you reach your goals. Mutual funds and exchange-traded funds (ETFs) are great ways to own a diversified basket of securities in just about any asset class.
  • Consider taxes. Place relatively tax-efficient investments, like ETFs and municipal bonds, in taxable accounts, and relatively tax-inefficient investments, like mutual funds and real estate investment trusts (REITs), in tax-advantaged accounts. Tax-advantaged accounts include retirement accounts, such as a traditional or Roth individual retirement account (IRA). If you trade frequently, do so in tax-advantaged accounts to help reduce your tax bill.
  • Monitor and rebalance your portfolio as needed. Evaluate your portfolio’s performance at least twice a year using a benchmark that makes sense for you. Remember, the long-term progress that you make toward your goals is more important than short-term portfolio performance. As you approach a savings goal, such as the beginning of a child’s education or retirement, begin to reduce investment risk, if appropriate, so you don’t have to sell more volatile investments, such as stocks, when you need them.
  • Choose appropriate benchmarks. Lastly, your benchmark to measure investment performance should match your portfolio and your goals. Don’t be tempted to compare your portfolio to what performed best in the market last year or even a portfolio invested 100% in stocks. You should have a portfolio selected to best meet your goals, with an appropriate balance of potential return and risk as well. Progress toward your goals is more important than picking the top-performing stocks each year—which, for any investor, isn’t possible to predict.

Resolution 4: Prepare for the unexpected

Risk is a part of life, particularly in investments and finance. Your financial life can be upended by all kinds of surprises—an illness, job loss, disability, death, natural disasters, or lawsuits. If you don’t have enough assets to self-insure against major risks, make a resolution to get your insurance needs covered. Insurance helps protect against unforeseen events that don’t happen often but are expensive to manage yourself when they do. The following guidelines can help you prepare for life’s unexpected moments.

  • Protect against large medical expenses with health insurance. Select a health insurance policy that matches your needs in areas such as coverage, deductibles, co-payments, and choice of medical providers. If you’re in good health and don’t visit the doctor often, consider a high-deductible policy to insure against the possibility of a serious illness or unexpected health-care event.
  • Purchase life insurance if you have dependents or other obligations. First, take advantage of a group term insurance policy, if offered by your employer. Such programs don’t generally require a medical check and can be a cost-effective way to provide income replacement for dependents. If you have minor children or large liabilities that will continue after your death for which you can’t self-insure, you may need additional life insurance. Unless you have a permanent life insurance need or special circumstances, consider starting with a low-cost term life policy before a whole life policy.
  • Protect your earning power with long-term disability insurance. The odds of becoming disabled are greater than the odds of dying young. According to the Social Security Administration, a 20-year-old American has a 25% chance of becoming disabled before normal retirement age and a 13% chance of dying before retirement age.1 If you can’t get adequate short- and long-term coverage through work, consider an individual policy.
  • Protect your physical assets with property-casualty insurance. Check your homeowner’s or renter’s and auto insurance policies to make sure your coverage and deductibles are still right for you.
  • Obtain additional liability coverage, if needed. A personal liability “umbrella” policy is a cost-effective way to increase your liability coverage by $1 million or more, in case you’re at fault in an accident or someone is injured on your property. Umbrella policies don’t cover business-related liabilities, so make sure your business is also properly insured, especially if you’re in a profession with unique risks and aren’t covered by an employer.
  • Consider the pros and cons of long-term-care insurance. If you consider a long-term-care policy, look for a policy that provides the right type of care and is guaranteed renewable with locked-in premium rates. Long-term care typically is most cost-effective starting at about age 50 and generally becomes more expensive or difficult to find after age 70. You can get independent sources of information from your state insurance commissioner. A sound retirement savings strategy is another way to plan for long-term-care costs.
  • Create a disaster plan for your safety and peace of mind. Review your homeowner’s or renter’s policy to see what’s covered and what’s not. Talk to your agent about flood or earthquake insurance if either is a concern for your area. Generally, neither is included in most homeowner’s policies. Keep an updated video inventory of valuable household items and possessions along with any professional appraisals and estimates of replacement values in a safe place away from your home.

Consider storing inventories and important documents on a portable hard drive. It’s also a good idea to have copies of birth certificates, passports, wills, trust documents, records of home improvements, and insurance policies in a small, secure evacuation box (the fireproof, waterproof kind you can lock is best) that you can grab in a hurry in case you have to evacuate immediately. Make sure your trusted loved ones know about this file as well, in case they need it.

Resolution 5: Protect your estate

An estate plan may seem like something only for the wealthy. But there are simple steps everyone should take. Without proper beneficiary designations, a will, and other basic steps, the fate of your assets or minor children may be decided by attorneys and tax agencies. Taxes and attorneys’ fees can eat away at these assets and delay the distribution of assets just when your heirs need them most. Here’s how to protect your estate—and your loved ones.

  • Review your beneficiaries, especially for retirement accounts, annuities, and life insurance. The beneficiary designation is your first line of defense, to make your wishes for assets known, and ensure that they transfer to who you want quickly. Keep information on beneficiaries up-to-date to ensure the proceeds of life insurance policies and retirement accounts are consistent with your wishes, your will, and other documents.
  • Update or prepare your will. A will isn’t just about transferring assets. It can provide for your dependents’ support and care and help you avoid the costs and delays associated with dying without one. It can also spell out plans to repay debts, such as a credit card or mortgage. Keep in mind that a beneficiary designation or asset titling trumps what’s written in a will, so make sure all documents are consistent and reflect your desires. When writing a will, we recommend working with an experienced lawyer or estate planning attorney.
  • Coordinate asset titling with the rest of your estate plan. The titling of your property and non-retirement accounts can affect the ultimate disposition and taxation of your assets. Talk with an estate attorney or lawyer about debts and the titling of assets, such as a home, that don’t have a beneficiary designation, to make sure they reflect your wishes and are consistent with titling laws that can vary by state.
  • Have in place durable powers of attorney for health care. In these documents, appoint trusted and competent confidants to make decisions on your behalf if you become incapacitated.
  • Consider a revocable living trust. This is especially important if your estate is large and complex, and you want to spell out how your assets should be used in detail, or if you have dependent children and want to spell in detail how assets should be managed to support them, who will manage the assets, and other issues. A living trust may not be needed for smaller estates where beneficiaries, titling, and a will can be sufficient, but talk with a qualified financial planner or attorney to be sure.
  • Take care of important estate documents. Make sure a trusted and competent family member or close friend knows the location of your important estate documents.

Finally, remember you don’t have to do everything at once. There’s a lot you can do to improve your financial health by taking one step at a time and think of these resolutions as a checklist. Make some real progress on your journey this year.

1Johanna Maleh and Tiffany Bosley. “Disability and Death Probability Tables for Insured Workers Who Attain Age 20 in 2022.” Social Security Administration, December 2022.