I've had people ask me what could be better than a 401(k) or a qualified plan for their retirement. My financial planner and what I hear from Wall Street say it is the best place to do this, and there's also a famous financial entertainer who states that you will make over 10% a year with possibly higher gains. They also say that you'll get a tax deduction which will save you money, and by the time you retire, you will have a nice nest egg built up and not have to worry about running out of money.
Well, let me tell you something. Let me inform you and possibly educate you on some things.
Number one: When has the stock market averaged over 10% a year, year after year, after year? Understand this: The Lost Decade from 2000 to 2010 saw a loss of 4%, plus all the fees for management.
Number two: Did you know that a 1% fee over a 30-year period will reduce your income by one-third? The average 401(k) fee in America is 2.99%. People have less than half of their money when they go to retire. And here's an amazing fact: 58% of people don't even think there's a fee. That's unbelievable!
Number three: When you have a 50% loss, it takes a 100% gain just to get back to even.
Number four: Very important, it is not about the return on your investment in retirement; it is about the distribution of your assets. It's not about the average gain in retirement; it is about the actual gain.
Number five: Yes, you are getting a tax deduction, but I call it a tax compounder because taxes are going to have to go up in the future because of our massive debt, you know?
Number six: I've had people tell me, "Well, Allan, I'm going to be in a lower tax bracket when I retire." But understand this: Most of your tax deductions are going to be gone. Don't you want to at least maintain the same standard of living that you have now, or better? Think about the things you can do with your grandkids, about the elevated healthcare costs, what about the risk in retirement that a stock portfolio only compounds, such as sequence of returns risk, which will decimate your retirement?
The number one risk in retirement is running out of money before you run out of life. Stock portfolios can't protect you from that. What about government tax risk and market risk, which are absolutely huge? Longevity risk, which is a risk multiplier, and there are many others. Let me ask you this: Has your financial planner ever told you about these risks? And by the way, he or she gets paid a fee on your money to manage your portfolio, whether you make money or not.
Now, understand, there is a financial product out there that, in my opinion and the opinion of properly educated advisors, is the best tax code-approved tax-free retirement system available today. With this vehicle, what if I could show you how to leverage our progressive tax system with a process and financial vehicle that is an asset class all in its own? Now you can turn taxable money into never-taxable money and provide you with tax-free money in retirement and before.
Now, this alone will save you tens of thousands, if not hundreds, possibly millions of dollars in taxes. This is absolutely great! You can possibly have this vehicle grow as a possible tax deduction. Now, understand, it's gross tax-deferred, and your distributions are tax-free. It also eliminates the taxation of Social Security and the means testing for Medicare Part B, which will be in the thousands of dollars per year. You're also protected from lawsuits, liens, and judgments.
Not only that, it gives you the ability to become your own financial institution, borrowing from yourself and paying yourself back, compounding interest for you and eliminating the effective interest cost you're paying on the money you borrow from financial institutions. It also avoids probate, and one of the best benefits is eliminating or mitigating the risks in retirement that I mentioned before, but a stock portfolio only compounds.
Now, that financial vehicle, believe it or not, is cash value life insurance. If you'd like to hear more about this, please click on my link below and get a free copy of my book, Wealth Beyond Taxes, and then go to my website or link and let's schedule a time and date that's convenient for you and let's talk about this. Now, understand, this is going to make a huge difference in your financial future.
Alan Porter Is the owner of Strategic Wealth strategies and also a Certified Financial fiduciary.
https://www.strategicwealthstrategies.com/
