April 1, 2014 – Five years ago, in the midst of the greatest economic calamity in more than three-quarters of a century, Finn Financial Group opened its doors for business with a pledge to help others “achieve maximum financial success and security through the effective use of structured settlements and other specialty annuity products and services” designed to improve their lives.

Witnessing so many people suffer financial and emotional distress during The Great Recession despite years of following conventional wisdom and “doing everything right” factored heavily into the direction we chose for our company.

In short, we wanted to help people feel safe and secure about their future.

So with over 30 years of structured settlement, insurance and education expertise, Finn Financial Group was born and today we celebrate an important milestone anniversary and reflect upon those we’ve helped along the way by providing:

Structured settlements for physically injured plaintiffs and their families

Tax-advantaged structured settlements for non-physical injury claims

Structured attorney fees

Retirement annuities and 401(k) rollovers

Present value analyses for claims associates and attorneys

Service to the structured settlement, claims and legal communities through volunteerism, publications, educational seminars and webinars

We are most appreciative of those whose ongoing vote of confidence and encouragement has made it possible for our firm to flourish when so many  others didn’t survive these past few years.

We value the opportunity to be of service more than we can ever adequately express and look forward to continuing to serve as your trusted resource for years to come.

Please call anytime we can help you or anyone you know who can benefit from our area of expertise.

THANK YOU for allowing us to help secure your future and Best Wishes for YOUR continued success!

March 25, 2014 – With the reality of Malaysia Airlines Flight 370 now coming into focus, families and friends of those lost on that ill-fated flight will begin the long, personal and very painful journey of grief processing.

Nothing prepares anyone for the sudden loss of a loved one.

There are no classes, no books, no training that can easily help anyone come to terms with such a shocking change.

But thanks to AirCraft Casualty Emotional Support Services (ACCESS), survivors have a resource committed to helping them cope.

Heidi Snow, whose own fiance died when TWA Flight 800 crashed in 1996, founded ACCESS as a non-political non-profit organization which coordinates peer-to-peer grief mentoring services to those who struggle with the emotional aftermath of air disasters.

Click [HERE] to see Heidi’s recent interview with CNN’s Chris Cuomo

The Finn Financial Group has been a proud supporter of ACCESS over the years and I am personally very honored to consider this amazing woman a friend.

Our hearts go out to those who lost their lives on Malaysia Airlines Flight 370 and their families.

Reprinted from our March 5, 2014 newsletter:

Structured Settlements Changing Lives

Looking for proof that structured settlements change lives?

Then please take a few minutes to watch this short video of Robin, a woman whose touching first person account of her journey following the untimely death of her husband underscores why so many people – claims associates, attorneys, mediators, judges, Members of Congress, disability advocacy groups, etc. – passionately endorse the use of structured settlements as a means of resolving personal injury claims:

[Click HERE] for link to video

Two years ago, Prudential Structured Settlements reached out to select industry leaders from across the country to form the Structured Solutions Leadership Council in an effort to help them, as a provider of structured settlement annuities, better understand the challenges our industry faced.

I am honored to have been invited to serve as one of the charter members of the Council and am extremely proud to have played a small role in helping this video move from concept to reality.

While a wealth of exceptional written material about structured settlements exists, there was consensus among the Leadership Council that the industry could benefit from actual “day in the life” video testimonials from structured settlement recipients themselves who could explain how they personally benefited from choosing a structured settlement in ways pamphlets and magazine articles never could.

It had been more than a decade since I received a very heartfelt letter from a young widow, whose structured settlement I helped implement, thanking me for my “sensitivity to (her) broken heart” and for orchestrating something that would “provide financially for (her) family in the years to come” even though structured settlements “seemed too good to be true.”

So when considering potential candidates for this initiative, Robin was the first person who came to mind because I knew her story was so compelling.

Nothing can prepare a person for the unexpected death of a family member or the aftermath of any ensuing claim following such a shocking loss. Such turmoil can embitter even the strongest among us.

But those facing similar grief now have a kindred spirit in Robin and her story can serve as a beacon of hope amid their own sea of wariness, fear and uncertainty. We applaud her bravery for being willing to share such a personal experience.

Thanks also to Prudential Structured Settlements for its vision and support of the structured settlements, claims and legal communities. Along with the many other excellent life markets we are proud to represent, Prudential’s exceptional leadership on this particular initiative deserves special accolades.

Thank you for the opportunity to be of service and best wishes for continued success.

Enjoy the video!

February 28, 2014 – For years, many “experts” in the financial advice-giving business have cautioned clients to shy away from annuities when it comes time to getting serious about retirement planning.

Setting aside the possibility that this bias against annuities may have more to do with lack of education or a personal financial self-interest that lies elsewhere than a true dislike of annuities, one is left to wonder:

Why can’t annuities and traditional investing coexist?

Well, it turns out they can.  And we believe they should.

Which makes “Breaking the 4% rule,” a white paper unveiled a few months ago by J.P Morgan Asset Management, so special.

Here are a few reasons why you may wish to take this paper very seriously:

It represents a break from the past – For many years, economic conditions and the mean age of Americans supported the 4% withdrawal approach to retirement planning.  But with baby boomers heading for the exits en masse over the coming decade and economic confidence iffy, strategies must adapt.

Its focus on Decumulation, not Accumulation – The mindset required for successful nest egg building is fundamentally different than the one needed when it comes time to preserve and draw down the retirement funds acquired over a career.

It actually embraces annuities – Honest!  Well, “embraces” may be a bit strong since you actually have to look for it.  “Recognizes the importance of” may have been a better choice of words.  But it is there and its inclusion speaks volumes.

We’re actually OK with the fact that the importance of annuities as part of one’s overall financial plan wasn’t placed front and center in this particular paper.  It was, after all, produced by J.P. Morgan Asset Management (emphasis added).

“. . . retirees with little or no lifetime income have a greater risk of poorer outcomes later in retirement than retirees with higher levels of lifetime income.”

But the J.P Morgan Dynamic Retirement Income Withdrawal Strategy which serves as the cornerstone of their paper, specifically considers lifetime income as one of their five key factors in achieving optimum retirement success.

“Greater lifetime income, from sources such as Social Security, pensions and lifetime annuities allows retirees to increase both their withdrawal rates and equity allocations.”

While the paper is a good read, we’re guessing most of you are less interested in analyzing formulae better suited for the set of Good Will Hunting than you are hearing about the highlights.

“Wealthier retirees should be more conservative in their asset allocation, with larger fixed income allocations.”

So we took the liberty of interspersing some of our favorite passages between the paragraphs above even if some of the conclusions seem a bit obvious.

A baby step maybe.

But J.P. Morgan’s apparent acceptance of the important role lifetime annuities, along with Social Security and pensions, play in addressing the longevity risk everyone faces, could signal a changing attitude toward this proven retirement security blanket.

We hope so.  Because we really think these doggone annuity things are the cat’s pajamas and deserve a place in everyone’s retirement strategy conversation.

(NOTE:  The Finn Financial Group does not provide investment advice and is not affiliated with J.P. Morgan)

February 9, 2014 – I don’t remember when I actually heard my first Beatles song but I distinctly remember the anticipation leading up to their February 9, 1964 debut on “The Ed Sullivan Show.”

I was eight years old and hadn’t been this excited since the year before when I learned that cigar-smoking chimpanzees were going to be featured at the Canfield Fair.

This was at least ten times more exciting than even that!

It seemed everyone in my second grade class, and all my friends in the neighborhood, were asking the same question that first week of February, 1964. “Are you going to watch The Beatles on Ed Sullivan?”

It’s important to keep in mind that up until about a month or two before that first show, hardly anyone had even heard of The Beatles here in the States. Heck, it had only been a year since they recorded their first album. But their rise was swift and would gain momentum in front of our very eyes that evening. Yet incredible mystery surrounded their arrival to say the least.

My best friend Kenny knew a thing or two about music. His family owned a dance studio so the arts featured prominently in his young life and that of his brothers and sister who lived next door. My friends David and Jimmy knew music, too. They both played the organ. But so did Mr. Beil and the music they produced, while pleasant, never caused girls to scream or faint.

But what did I know about music? There were no instruments in our house and, up until then, the records that got the most play time on my portable record player were “The Ballad of Davy Crockett” and “Tie Me Kangaroo Down, Sport.” Those little, yellow 78 rpm babies if you can believe it.

But The Beatles were still as much a curiosity on that first visit as they were a cultural phenomenon. What would they look like? What would they sound like? Do they really wear wigs? Why do they spell beetles like that?

So the hour finally arrived and the family gathered in front of the Philco television console which had been left on during dinner to ensure it was sufficiently warmed up for the big event.

I knew they were going to go first. My dad and older brother scoffed at this idea assuring me that only a crazy person would open the show with the headline attraction. But they didn’t know Ed. When The Beatles were introduced a few minutes after 8 o’clock and launched straight into “All My Loving,” I felt a rare sense of vindication.

So here they were and we watched, mesmerized even if we all experienced the show differently.

My dad, who liked Frank Sinatra, Nat King Cole and Herb Albert and the Tijuana Brass, tolerated the performance. “Well whaddaya know. So that’s The Beatles,” he uttered sarcastically unable or unwilling to conceal his sense of bemusement.

My mom, partial to Louis Armstrong and Connie Francis, smiled and giggled the same way she did when Ed Sullivan interacted with Topo Gigio. But she admitted she liked them! Thought they were cute.

My brother Mike was emotionless, studying their every move. Now Mike knew music. He had Bob Dylan 45s and was always at the forefront of every musical trend. He even knew all The Beatles’ names before they were displayed on the TV set. He grew weary of me asking, “Who’s that?” every time there was a close up of each Beatle. But he knew the answer.

As for me, I was spellbound. But it was a cross between fascination and disbelief. I loved the sound, the excitement, the energy. But I couldn’t figure out that hair. Were they wearing wigs or weren’t they? I spent the entire show trying to reconcile this. George’s seemed especially curious.

It would be months, if not longer, before the world accepted they were not wearing wigs.

Males just didn’t wear their hair like that. Long hair was for girls. The Beatles hairstyles made about as much sense as if the wall would have started eating a bowl of Grape Nuts. Boys wore crew cuts, flat tops or Princetons (which I usually favored), not long hair.

But it all changed after that evening. The next day, I said good-bye to the Butch Wax and the Alberto VO5 and combed my hair straight down as soon as I got on the school bus. A girl in class even told me she liked my hair because it looked like The Beatles.

Over the next several years, these four peculiar looking young men from another country would go on to influence music and all popular culture in ways even they likely couldn’t have imagined.

And those of us who were alive that day were probably watching Ed Sullivan and probably have a shared experience we can all relate to.

And you know that can’t be bad.

(Yeah, yeah, yeah)

February 7, 2014 – You don’t have to look too hard to find stories about people who are worse off because they completely undervalued the concept of planning for the future.

People who choose today at the expense of tomorrow.

I’m talking about people who opt for a lump sum of cash instead of the periodic payment options available to them when they win the lottery, trigger their pension benefits or settle a personal injury claim.

For many, the allure of “having their money and having it now” is too powerful and they forfeit the overwhelming advantages that accompany guaranteed future income.

As we mentioned in one of our blogs last month, the completely independent, nonprofit, noncommercial National Endowment for Financial Education (NEFE) estimates that . . .

” . . . 70% of all people who suddenly receive large amounts of money will lose that money within a few years.”

Today, we have another one to add to our list of sources of lump sum misery courtesy of CNN/Money:

“Reverse Mortgages: Safer but far from risk-free.”

A few of our favorite quotes from the article:

” . . . many borrowers have run into problems because they took their payment as a lump sum and spent the cash too freely.”

” Homeowners who choose the lump sum option could see their payouts reduced by 10% to 18% . . . “

” Monthly payments usually work out better anyway, especially for those who live longer.”

Although Fred Thompson, Henry Winkler, and a host of other well-known paid endorsers are convincing when touting the benefits of reverse mortgages, the article does a good job highlighting the risks that remain.

Especially with lump sums.

Our firm does not offer reverse mortgages so we will refrain from advising on them other than to say make sure you understand what you’re getting into if you or someone you know is considering one.

We will, however, go out on a very sturdy limb reinforced by mountains of evidence to suggest that anyone choosing a reverse mortgage will be better off if they choose the lifetime income option instead of a lump sum.

January 21, 2014 – We’re used to reading about Warren Buffett’s sensible, folksy investing philosophy that has made him one of the world’s all-time most successful – and richest – financiers.

But who knew he was such a sports wagering junkie?

And we’re not talking about the few dollars or bragging rights most of us risk when we fill out our NCAA “March Madness” Basketball Tournament brackets.  That wouldn’t make the news.

What did make the news today is the fact that Mr. Buffett’s company is backing the Quicken Loans Billion Dollar prize to anyone submitting a flawless bracket.

Lump Sum or Annual Payments?

Let’s imagine for a moment you submit a bracket and beat the approximate 1-in-9.2 quintillion (or, 1 billion times 9.2 billion) odds and actually pick all winners.

You now have a choice between:

A)  $500 million cash lump sum present value of $1 billion; or,

B)  $25 million a year guaranteed for 40 years?

Which would you choose?

On a weekly basis, our firm comes in contact with people facing the same choice when deciding how to accept their personal injury settlement proceeds.

Although the dollars involved have far fewer zeroes than the billion being discussed here, the choice is similar and the questions they ask themselves are the same:

Do I want/need all this cash up front?

Or will guaranteed future payments make me happier?

If I choose cash, do I possess the financial and emotional acumen to make smart choices going forward?

Structured settlements have been helping secure peoples’ futures for more than 30 years.  Offering safety, peace of mind and a decided tax advantage not available to the general public, those who are offered a structured settlement should think long and hard before choosing all cash instead.

Stories abound about “lottery millionaires” choosing a lump sum of cash over the security of guaranteed future payments only to end up broke in a very short period of time.  In fact, we just wrote about The Real Gamble a few days ago.

So unless your name also happens to be Buffett, we’d strongly urge you to choose the annual payments if you win this particular prize.

And while we don’t know what kind of premium Berkshire Hathaway is charging Quicken Loans to reinsure this contest, it could be a sucker’s bet of epic proportions given its low probability of every paying off.

Regardless, whatever amount of money Mr. Buffett receives for exposing less than 1% of his personal net worth (99% of which he’s pledged to give to charity anyway), we have a hunch he’ll do just fine either way.

Our money’s on Buffett just the same.

January 16, 2014 – There’s no shortage of stories about people blowing large sums of money in a short period of time with little or nothing to show for it.

Professional athletes.  Rock stars.  Movie stars.  Everyday people.

While the high profile celebrity-types (who people generally don’t feel sorry for) are the ones who usually make the papers, sometimes it takes an extreme case with criminal implications to illustrate the underlying risks that accompany windfall sums of money.

And when the person is poor and disabled, we get angry.

Take the story of Malcolm Ramsey, a mentally incompetent St. Petersburg, Florida man living in an assisted living facility on government aid.  Winner of a $500 per week for life lottery prize, Ramsey chose the lump sum over the cash flow and managed to spend $170,000 – more than half of his after-tax net – within a few weeks.

This story did make the paper because so many unconscionable circumstances surround it.  Special thanks to my friend, colleague and lottery winnings expert Don McNay for calling my attention to this sad story.

But many less sad stories that don’t make the papers still involve the same ugly truths about windfall sums of money highlighted by this article:

“Friends” and relatives always seem to show up with their hands out

With so many consumer goods available for purchase, it’s virtually impossible to spend any amount of money too fast

There’s no substitute for professional guidance from someone who understands the problems windfall sums of money can cause

Several times a week, I am involved in situations where people have a choice between receiving a large sum of cash or guaranteed future cash flows tailored to their individual needs.

So many times they choose cash.

While there are seemingly many good reasons to choose cash, statistics from the National Endowment for Financial Education remind us:

“It is estimated that 70% of all people who suddenly receive large amounts of money will lose that money within a few years.”

People who structure some of their settlement proceeds over time CAN’T spend all their money in a few years.

Lottery winners who chose $500 a week for life over cash can’t either.

Given Malcolm Ramsey’s legal capacity issues, it’s hard to lay any fault at his feet.

But hopefully everyone else sees the irony in this story:  Windfall cash is the real gamble.

January 8, 2014 – Most people who accept structured settlements when settling their personal, physical injury claims are not repeat customers.

After all, most people never file significant injury claims in the first place let alone doing so on multiple occasions.

And since our involvement with a client typically ends once a policy is issued (we don’t go around stalking them after the fact to try to undo their contract), we rarely ever even hear from those we’ve helped along the way.

But on a semi-regular basis we do receive calls from people who have misplaced their policies or have moved and simply need to alert the life company of their new address.

Today was one of those days.

“Gena” (not her real name) was 18 years old in 2001 when her mom insisted she structure her settlement following an automobile accident.

She had previously settled with the at-fault party for cash and was getting ready to settle her under-insured motorists claim with her own carrier.

Gena’s mom told her she had received enough money from the first settlement and didn’t need any more money at her age so was thrilled when the claims representative offered her daughter a structured settlement.

Court approval was not required since Gena was already 18 but the mom thought it was a good idea anyway.

I took this opportunity to ask Gena how she felt, all these years later, about structuring her settlement.

Almost as if scripted by the National Structured Settlements Trade Association (which it wasn’t), Gena showed no hesitation in telling me how glad she was that her mom “encouraged” her to structure her settlement.

She proudly told me how she had used the structured settlement proceeds to help pay off her college loans and now, at age 32, was going to use some of her money to help furnish a house she had recently purchased.

“I was very irresponsible at that age. 18-year olds don’t need that kind of money.  I would have just spent it all anyway on vacations or whatever. I was much better off waiting.”

That settlement occurred half my career ago and hearing this personal account of a structured settlement having such a positive impact on a young person’s life reinforced why I am so proud of what I do for a living.

And for all those insurance carriers and claims representatives who ever doubted the ancillary benefits of offering structured settlements, it turns out Gena had such a favorable impression of her mom’s auto insurer that she now chooses to insure her own car with the same company.

Tough to beat that kind of PR.

Although most of the industry statistics about people spending their money too rapidly as a reason for structuring are only anecdotal, calls like today’s only make such claims easier to believe.

For the record, I have yet to have anyone ever call me to say they regretted structuring their settlement.

So maybe the commercial got it wrong.  Maybe not everybody wants their money and wants it now.

Waiting seemed to work out just fine for Gena.

January 7, 2014 – Some seemingly sensible retirement planning ideas just don’t hold water when scrutinized.

Take Jane Bryant Quinn’s article, “Don’t Be Too Cautious,” appearing in this month’s AARP Bulletin for instance.

While the underlying premise of her article – allocating one’s retirement funds into a series of “buckets” designed to maximize retirement cash flow while protecting against loss – is well-intentioned, it leaves the reader with a false sense of the very security retirement is supposed to provide in the first place.

The web version of the article even carries the unfortunate and misleading headline “Securing Income for Life.”

In other words, her bucket has a hole in it.

Stocks and Risk

While stocks historically increase the value of one’s portfolio over long periods of time, they cannot be relied upon to deliver certainty, especially when it comes to timing their conversion to cash flow.

One of the more irresponsible passages surfaces in paragraph eight:

“By the time your bond bucket runs low, your bucket of stocks will have grown in value, maybe by a lot.”

Or, maybe not at all.

Maybe your bucket of stocks will contain shares of companies managed by the same guys who ran Enron into the ground.

Maybe you won’t mind eating at soup kitchens or moving in with your kids if your stock bucket leaks.

Besides, how does Ms. Quinn know what stocks will or won’t do?  Or when?

The article is filled with similar assumptions that stocks “will” increase at just the right time and this recommended bucket approach “could” make your retirement “potentially” greener “if” certain things come to pass.

But words like could, potentially and if are not synonyms for security.

Ms. Quinn knows this and should have done the 50-plus crowd a better service by apprising them of the inherent risks of her strategy.

Sure, it might work out but who wants to take chances with money they can ill afford to lose?

Just add a fourth bucket

Perhaps if she simply added a fourth bucket to the mix, one for annuities, she could legitimately classify this as a true “Securing Income for Life” strategy.

After all, outside of pensions and Social Security, life annuities are the only way to guarantee you will never run out of money.

Even the wisdom of the long-touted 4% draw down strategy she hangs her hat on throughout the article is being called into question as this Wall Street Journal article, “Say Goodbye to the 4% rule,” from last March illustrates.

We don’t disagree that Ms. Quinn’s suggestion has some potential.

We aren’t against incorporating stocks into one’s overall retirement strategy.

We just firmly believe that annuities have earned the right to be included in ANY conversation about assuring lifetime security in retirement and were disappointed such a respected author would omit them from an article in a periodical wielding such powerful influence.