Bensman Risk Management, Inc.


Insurable Interests

Bensman Risk Management, Inc.
2333 Waukegan Road Suite 275
Bannockburn, IL 60015
847-572-0800 Phone
847-572-0502 Fax

Insurable Interests may offer general financial, insurance, tax and business ideas. However, due to the ever-changing tax laws as well as the complexity of the financial industry, you should seek professional advice before implementing any of the ideas contained in this newsletter. The Bensman Group, Bensman Associates Ltd., Bensman Risk Management, Inc. or Schemata, L.L.C. assumes no liability whatsoever in connection with the use of this newsletter.

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Securities offered through Kestra Investment Services, LLC (Kestra IS), Member FINRA/SIPC. Investment Advisory Services offered through Kestra Advisory Services, LLC (Kestra AS). Kestra IS and Kestra AS are not affiliated with The Bensman Group, Bensman Associates Ltd., Bensman Risk Management, Inc. or Schemata, L.L.C.

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Insurable Interests

Vol. 4, Issue 6 • February 2009

MONTHLY MESSAGE

Do You Have a Personal Recovery Plan?

Much is being written about the government’s plan to help the country recover from the current economic collapse. But what about you as an individual? Do you have a recovery plan?

In extremely difficult economic times like these, we watch our net worth and the value of our investments decline dramatically. Each of us has to decide how to handle this situation.

Of course, you could do nothing and just accept the decline, with no action and no plan. However, taking this approach could yield inappropriate results in asset allocation, estate and financial planning, and budgeting. While it may seem easy to bury your head in the sand, we encourage people to take action.

At The Bensman Group, we offer four concepts for your consideration:

Rebalancing of your existing investments. Over the long term, this process has worked. But it can be nerve-racking over the short term during volatile markets such as we are experiencing now. You need to decide if you can emotionally and financially handle the idea of buying stocks or other decimated investments in this environment. Can you stomach another potential significant decline in the stock market?

Guaranteed products. For those concerned about investing in the markets, a variety of guaranteed products exist. These products may make sense for the appropriate client and situation. Note that all guarantees are subject to the claims paying ability of the issuing insurance company.

Alternative investments. Primarily for high net worth individuals (net worth minimums vary from $1.5 million to $5 million, exclusive of primary residence), foundations and others, alternative investments allow for access to some very sophisticated strategies. These investments include private equity, hedge funds, managed futures, private real estate investment trusts (REITs) and other investment classes. Investing in these vehicles allows for greater diversification than can be achieved with traditional stocks and bonds. The Bensman Group has a wide array of alternatives to match your needs. (* See footnote below.)

Life insurance. Many would be surprised to see this option mentioned, but life insurance can be a great way to replace lost wealth for future generations. For example, if a person was worth $10 million before the bad economy, and that person is now worth $7.5 million, he or she could purchase a $2.5 million life insurance policy to replace the decline in value. Under the right circumstances, this purchase can occur for less than 50 basis points per year of net worth. In addition, life insurance can be used for estate planning and legacy purposes.

We suggest you talk to your Bensman Group advisor to help you sort through your options for creating a personal recovery plan. Please contact us at 847-572-0800 or jfeiger@bensman.com.

* Alternative investments are often speculative, lack liquidity, lack diversification, are not subject to the same regulatory requirements as mutual funds, may involve complex tax structures and delays in distributing important tax information, and may involve substantial fees. These products often execute trades on non-U.S. exchanges. Investing in foreign markets may entail risks that differ from those associated with investments in U.S. markets. These investments may not be appropriate for all investors.

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