From the category archives:

Time Value of Money

What You Should Know About the Next Decade

June 19, 2011

Podcast: Download (23.0MB)

This week Doug Andrew discussed the following:

Upcoming Free Webinar

Attend our free 90-minute webinar live over the Internet this coming Tuesday, June 21st at 11:00 a.m. pacific (12:00 p.m. mountain, 1:00 p.m. central, 2:00 p.m. eastern), and again at 6:30 p.m. pacific (7:30 mountain, 8:30 central, 9:30 eastern). The topic is “True Asset and Wealth Optimization.” You’ll learn how to choose the right investments for liquidity, safety, rate of return and tax benefits.

Click Here to Register Now

All attendees receive a bonus hardcover copy of Last Chance Millionaire, Doug Andrew’s New York Times best-selling book.

The Next 10 Years Should Be Interesting

Where market uncertainty was a hallmark of the Lost Decade, the next 10 years have potential to be much more interesting.

Most Americans who lost money in their IRAs and 401(k)s over the past few years are just now starting to get back to where they were 10 years ago.

Now we’re facing a triple whammy of higher taxes, inflation and market volatility that could prove very challenging for those who fail to position their money properly.

People who’ve learned the Missed Fortune strategies and followed them, have predictably been able to double or nearly triple what they had 10 years ago. Not only did they do it during the biggest downturn since the Great Depression, they’ve done it tax free.

This is important because with the Bush tax cuts expiring in 2012 and the prospect of more tax hikes on the way, you’ll need all the tax protection you can get.

Government spending continues at a breakneck pace and Congress is looking to raise taxes to meet their funding needs. Taxes are going up. Count on it.

In addition to raising taxes, the printing of money to cover the payment of government obligations is setting the stage for increased inflation.

Social Security has a $63 trillion dollar deficit owing that it has promised to pay out to recipients in future benefits.

It’s time you knew what you don’t know about keeping your fortune from slipping through your fingers.

31 FLAVORS of How People Miss Out on Fortunes

FLAVORS is an acronym that stands for Fortunes Lost Amid Valid Optimization & Reallocation Strategies.

These are rules and strategies that even seasoned tax attorneys and accountants don’t know until they’re shown.

People miss out on fortunes because they choose short term investments for long range goals to fund their retirement.

They put their money into what are termed “crawl investments” that offer too low a rate of return compared to the rate of inflation. They miss out on money that could be made by linking their returns to those thing that inflate.

Some put money into “walking investments” where they place their money in retirement vehicles that are tax deferred rather than tax free. This means that they pay through the nose in taxes when they start to withdraw funds from their IRAs & 401(k)s.

If you understand how money works you can put the equity in your real estate to work to accumulate, over a 30 year period, a huge windfall for your retirement.

By empowering your wealth, you learn how money works, you employ a system of accountability and responsibility and you learn better ways to grow your money tax free.

Learn how to time the markets, how to do a strategic roll-out that protects your principal with a predictable rate of return that accumulates tax free. You can learn the power of compound interest and so much much more in the Missed Fortune strategies.

It won’t just benefit you, this knowledge will also bless your family when your fortune transfers to them when you’re gone.

Talk to a Missed Fortune advisor today.

Bonus Missed Fortune E-Book: Baby Boomer Blunders The average Baby Boomer has less than $50,000 accumulated for retirement (which means many have less than that), primarily due to bad habits and having money invested in the wrong places where economic downturns can diminish their nest egg. Download this e-book now at www.babyboomerblunders.com.

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Taking Ownership of Your Financial Future

April 24, 2011

Podcast: Download (23.0MB)

This week Doug Andrew discussed the following:

Upcoming Free Webinar

Attend our free 90-minute webinar live over the Internet this coming Tuesday, April 26th at 11:00 a.m. pacific (12:00 p.m. mountain, 1:00 p.m. central, 2:00 p.m. eastern), and again at 6:30 p.m. pacific (7:30 mountain, 8:30 central, 9:30 eastern). The topic is “True Asset and Wealth Optimization.” You’ll learn how to choose the right investments for liquidity, safety, rate of return and tax benefits.

Click Here to Register Now

All attendees receive a bonus hardcover copy of Last Chance Millionaire, Doug Andrew’s New York Times best-selling book.

Bad News for the Boomer Generation

A recent statistic claims that 50% of baby boomers will outlive their money.

They’ll run out of savings and have to rely on social security, charity and welfare or their own children for support.

A study in the 1970′s by the Bureau of Labor & Statistics showed that out of every 100 males born in America, by the time they were 65 years old, 36 of them would be dead.

The study also showed that 54 percent were predicted to be dead broke and completely dependent upon social security.

Another 5% would still have an income. They would continue to work, not because they wanted to, but because they had to work.

In the richest nation on earth, only 5% would be financially independent.

That statistic hasn’t changed in the last 40 years.

Even today, only 5% of Americans are financially independent by the time they hit their golden years.

That leaves 95% of Americans still striving to make ends meet when they reach retirement age.

A lot of these people lost their future back in 2008 when their IRAs and 401(k)s lost 31% of their value on average. Some lost upwards of 40-50% of their value.

If you lose half of the value of your retirement nest egg, it takes at least 10 years to get back to breaking even.

Putting that money into a bank or a CD at 1% won’t allow you to double your money in that amount of time. Putting it into the market isn’t the answer either.

There are far better strategies to grow your money without putting it at risk.

We Don’t Know What We Don’t Know

There are at least 31 FLAVORS of missed fortune which is an acronym for:

Fortunes
Lost
Amid
Valid
Optimization &
Reallocation
Strategies

People miss out on fortunes because of the time value of money, meaning if they just did things a little bit differently, they’d increase their net worth drastically.

For instance, right now we’re in tax season.

Many people view their income tax refund as a forced savings program. Instead of socking that money away and giving the government a zero interest loan, you could change your withholding and set aside that difference. With an extra $2,000 annually, you could accumulate an extra quarter to half a million dollars in your retirement account.

Government leaders make a big deal out of cutting $100 million dollars out of the annual $3.5 trillion dollar federal budget.

Do the math. If you spend about $2,000/month on your living expenses and you were to cut your spending at the exact same ration, you’d only reduce your budget by 6 cents.

We don’t have a revenue problem in this country, we have a spending problem and taxes will be going up.

If you’re putting your money into IRAs and 401(k)s and thinking tomorrow’s tax rates will be lower, you’re going to be in for a rude awakening.

There are better ways to save for retirement.

Taking Ownership of Your Financial Future

By implementing missed fortune strategies, you get much better results than simply doing what everyone else is doing.

There’s a huge difference between Mr. Tax-to-the-Max who takes minimum distributions and pays 2 to 4 times as much in taxes and Mrs I’ve-a-lot-more who enjoys double the net spendable income and pays about 1/6th as much in taxes.

Mrs. I’ve-a-lot-more stimulates the economy by taking ownership of her future rather than just rolling over and paying too much in taxes.

Instead of getting a tax refund and spending it after letting the government keep your money for a year, learn how to put that money to work for you and accumulate an extra quarter million, half million or even a million dollars by retirement.

Missed fortune strategies teach you how to use a system that protects your money whether the market goes up or down without risking your principal.

You’ll learn to keep your principal safe and make sure you don’t lose the money you set aside. You keep the money you make and never subject it to risk or loss again.

These strategies can teach you how to earn a rate of return that’s greater than taxes or inflation and that grows your money tax free.

We’ve helped several thousand people take ownership of their future and achieve financial independence.

If you’d like to know what these people know, schedule a meeting with a Missed Fortune advisor.

Bonus Missed Fortune E-Book: Baby Boomer Blunders The average Baby Boomer has less than $50,000 accumulated for retirement (which means many have less than that), primarily due to bad habits and having money invested in the wrong places where economic downturns can diminish their nest egg. Download this e-book now at www.babyboomerblunders.com.

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Higher Taxes, Inflation Are Coming

February 20, 2011

Podcast: Download (0.0KB)

This week Doug Andrew discussed the following:

Upcoming Free Webinar

Attend our free 90-minute webinar live over the Internet this coming Tuesday, Feb. 22nd at 11:00 a.m. pacific (12:00 p.m. mountain, 1:00 p.m. central, 2:00 p.m. eastern), and again at 6:30 p.m. pacific (7:30 mountain, 8:30 central, 9:30 eastern).

The topic is “True Asset and Wealth Optimization.” You’ll learn equity management and how to choose the right investments for liquidity, safety, rate of return and tax benefits.

Click Here to Register Now

All attendees receive a bonus hardcover copy of Last Chance Millionaire, Doug Andrew’s New York Times best-selling book.

A Conservative Growth Rate

Religious conservatives are having more children than secular liberals.

In an article titled “Survival of the Godliest,” Phillip Longman writes, “In a world in which child bearing is rarely accidental and almost never rewarding economically, birth rates increasing reflect values choices.”

So, those who end up following that ancient injunction to “go forth and multiply” wind up putting more of their genes and ideas into the future than those who don’t.

I believe the election of Barack Obama in 2008 will be turn out to be a slight diversion — quickly corrected because of the deceptive call for change — in a long term movement toward conservatism in the United States.

Regardless, we’ve already painted ourselves into a corner and it’s going to be tough getting out of it.

The National Debt has grown $4 trillion in the last two years and couple of months. The Congressional Budget Office estimates that the National Debt could rise to $27 trillion by the end of the decade.

That doesn’t include the $62 trillion of unfunded liabilities representing Social Security, FICA and Medicare. We don’t have a dollar of that in our coffers.

Even if we do see some more conservatives in Congress, they’ll have a monumental debt to try to overcome.

The writing’s on the wall. Taxes will have to go up and inflation is just around the corner.

You need to protect yourself and your retirement funds. I can teach you how.

Solve Your IRA and 401(k) Dilemma

It’s very important that you know the difference between tax-deferred and tax-free.

Now’s the time to convert your IRAs and 401(k)s to better, safer strategies and meet your tax obligations now while taxes and account balances are lower.

These strategies grow tax-free, withdraw tax-free and eventually transfer tax-free.

The 5 percent of Americans that are true financial thrivers didn’t get that way by following the same old traditional advice and socking away money in IRAs and 401(k)s.

If inflation hits, you want your money linked to the things that are inflating. In the 1970s, when we had double-digit inflation, I was earning a rate of return of 5.5 percent greater than inflation using conservative, tax-free investments.

I can teach you how to avoid what I call the Baby Boomer Blunders. I can teach you the 31 FLAVORS — Fortunes Lost Amid Valid Optimization and Reallocation Strategies.

I can teach you the difference between Mr. Taxed to the Max and Mrs. I’ve a Lot More.

Now is the time to start securing a prosperous financial retirement.

Meet with a Missed Fortune advisor to get started planning your future.

Bonus Missed Fortune E-Book: Baby Boomer Blunders

The average Baby Boomer has less than $50,000 accumulated for retirement (which means many have less than that), primarily due to bad habits and having money invested in the wrong places where economic downturns can diminish their nest egg.

Download this e-book now at www.babyboomerblunders.com.

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Don’t Let Taxes & Inflation Threaten Your Retirement

January 2, 2011

Podcast: Download (22.9MB)

This week Doug Andrew discussed the following:

Upcoming Free Webinar

Attend our free 90-minute webinar live over the Internet this coming Tuesday, Jan. 4th at 11:00 a.m. pacific (12:00 p.m. mountain, 1:00 p.m. central, 2:00 p.m. eastern), and again at 6:30 p.m. pacific (7:30 mountain, 8:30 central, 9:30 eastern).

The topic is “True Asset and Wealth Optimization.” You’ll learn how to choose the right investments for liquidity, safety, rate of return and tax benefits.

Click Here to Register Now

All attendees receive a bonus hardcover copy of Last Chance Millionaire, Doug Andrew’s New York Times best-selling book.

Protect Yourself From Taxes and Inflation

The economy is like a sinking ship and Congress is rearranging the deck chairs.

Our National Debt has jumped to $14 trillion. It doesn’t matter if we postpone higher tax rates for a couple of years. Sooner or later, taxes will be going up and dollars will be worth less.

Taxes and inflation can significantly lower your purchasing power. You need to protect yourself.

You need an investment strategy that is tax-free, not tax-deferred.

A dollar doubling every period for 20 periods grows to over $1 million tax-free; it only reaches around $27,000 if it’s tax-deferred.

Most people don’t realize this. They sock away money in traditional accounts that can be taxed on the back end.

People withdraw money thinking they’ll be in a lower tax bracket when they retire, but they’re in a bracket as high or higher than they were because they lost their deductions.

You need to set aside your money in vehicles that are safe, liquid and produce a rate of return greater than inflation. You can conservatively earn 8 to 10 percent in a tax-free environment.

I’m not talking about IRAs, 401(k)s or 457s. I’m talking about tax codes 72e and 7702.

If you average 7.2 percent growth a year, your money will double in 10 years. For every million dollars you accumulate, you can take out $72,000 a year without touching your principle.

Your future could be a whole lot more secure.

Start Saving Smarter

Folks who follow the Missed Fortune strategies have taken advantage of indexing. If inflation occurs, their money is linked to the things that are inflating.

They didn’t lose a penny in 2008, when most Americans lost 30 to 40 percent in the value of their retirement accounts.

I can teach you that IRAs and 401(k)s are not the best ways to safe for retirement. I can teach you that sending extra payments to the mortgage company is not the best way to get out of debt.

In my book Baby Boomer Blunders, I explain how to avoid the financial mistakes that 95 percent of Americans make.

Now is the time to start converting those retirement plans into safer, smarter investments.

Meet with a Missed Fortune advisor to get started planning your future.

Bonus Missed Fortune E-Book: Baby Boomer Blunders

The average Baby Boomer has less than $50,000 accumulated for retirement (which means many have less than that), primarily due to bad habits and having money invested in the wrong places where economic downturns can diminish their nest egg.

Download this e-book now at www.babyboomerblunders.com.

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31 FLAVORS to Create an Abundant Retirement

November 21, 2010

Podcast: Download (22.9MB)

This week Doug Andrew discussed the following:

Upcoming Complimentary Webinar

Attend our free 90-minute webinar live over the Internet this coming Tuesday, November 23th at 11:00 a.m. pacific (12:00 p.m. mountain, 1:00 p.m. central, 2:00 p.m. eastern), and again at 6:30 p.m. pacific (7:30 mountain, 8:30 central, 9:30 eastern).

The topic is “True Asset Optimization: How to Choose the Right Investments.” You’ll learn how to maintain liquidity and guarantee safety of principal while earning a healthy, tax-free rate of return that outpaces inflation.

Register now by calling 1-888-76-Radio (888-767-2346). If operators are busy, please call again.

All attendees receive a bonus hardcover copy of Last Chance Millionaire, Doug Andrew’s New York Times best-selling book.

Investors Losing Confidence in Traditional Investments

Investors are getting tired of the slow gains for a few years only to have those gains, along with original principal, be lost rapidly.

In 2008, most people lost 31 percent from their IRA and 401(k) and are still not back to what they had in as their initial principal.

Investors are getting fed up with the same traditional advice of investing in IRAs and 401(k)s, to postpone taxes and to have to deal with market volatility for the long-term gain.

According to a new survey from Prince & Associates, 81 percent of investors with $1 million or more in investable assets plan to take money away from their current advisor. An even larger number, 86 percent, plan to tell other investors to avoid their advisor.

Only 2 percent plan to recommend their firm to other investors. That’s of critical importance, because wealthy investors often get investment advice from each other.

Deferring taxes to a later date as taxes continue to rise, lacking liquidity, and placing the rate of return for a retirement nest egg in variable products are only three of the major problems with these traditional investments.

How Can You Gain Confidence and Prepare for an Abundant Retirement?

The first step to gaining confidence is to avoid falling into the investment traps that so many others are facing by deciding not to use the same investment advice that they are.

Why would you defer taxes knowing that the trend is that taxes are rising? Why you would place your retirement hopes into a volatile market and hope to time the market correctly?

By learning the 31 FLAVORS of Missed Fortune, you can:

Choose tax-free investments instead of tax-deferred ones
Have liquidity so that you can access your money when you would like to
Enjoy safety of your principal where you can lock in gains using indexing.

FLAVORS stands for “fortunes lost amidst valid optimization and reallocation strategies.” Implementing 2 or 3 of the 31 can generate $70-80 thousand dollars a year for retirement that is tax free and will continue to be replenished year after year no matter what is happening in the market.

The 31 FLAVORS can show you key points in the different financial aspects of your life that can allow you to sleep comfortably at night knowing that you are not gambling with your retirement. They include:

6 FLAVORS regarding choosing the wrong investments for retirement
6 FLAVORS about your home and real estate
3 FLAVORS on proper tax planning and avoiding unnecessary taxes
7 FLAVORS on asset management
5 FLAVORS regarding risk management
2 FLAVORS about credit and debt management
2 FLAVORS on estate planning

Meet with a Missed Fortune advisor and learn how to implement these 31 FLAVORS and guarantee yourself an abundant retirement.

Bonus Missed Fortune E-Book: Baby Boomer Blunders

The average Baby Boomer has less than $50,000 accumulated for retirement (which means many have less than that), primarily due to bad habits and having money invested in the wrong places where economic downturns can diminish their nest egg.

Download this e-book now at www.babyboomerblunders.com.

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Will You Have Enough to Retire?

September 26, 2010

Podcast: Download (22.9MB)

This week Doug Andrew discussed the following:

Upcoming Complimentary Webinar

Attend our free 90-minute webinar live over the Internet this coming Tuesday, September 28th at 11:00 a.m. pacific (12:00 p.m. mountain, 1:00 p.m. central, 2:00 p.m. eastern), and again at 6:30 p.m. pacific (7:30 mountain, 8:30 central, 9:30 eastern).

The topic is “Mr. Tax to the Max Versus Mrs. I Have a Lot More.” You’ll learn the difference between using traditional accounts and advice and then outliving your retirement, as opposed to what the top 5 percent of Americans do to reach “the land of peace and abundance.”

Click Here to Register Now

All attendees receive a bonus hardcover copy of Last Chance Millionaire, Doug Andrew’s New York Times best-selling book.

Savings Dangers & Blunders

According to a new study, Americans are $6.6 trillion short of what they need to retire. Declining stock and housing values have squeezed savings.

Boston College’s Center for Retirement Research said they reached that $6.6 trillion figure using “conservative assumptions,” such as a 3 percent return rate on assets or no further cuts in pension coverage. That’s just not realistic.

Say you bought and held a random assortment of stocks and mutual funds from 1990 to 2001. You could have made, on average, 12.9 percent.

But how much did the average American earn during the most aggressive upswing in market history? 2.9 percent.

Most Americans buy and sell at the wrong times. One of the biggest blunders they make is using short-term investments for long-range goals. They put their money in accounts yielding 1 to 3 percent interest only to be ravaged by inflation and taxes down the road.

Most Americans lost 30 to 40 percent of the value of their IRAs and 401ks in 2008 and still haven’t recouped their losses. It doesn’t have to be this way.

Make Your Savings Earn More

There are people using indexing strategies who didn’t lose a dime in 2008 and locked in gains of 16 percent in 2009.

Most people using Missed Fortune strategies are up 50 percent from where they were four or five years ago. That’s without adding more money themselves — and it’s tax free.

When you save for the future, consider what that future may look like. Most people will not be in a lower tax bracket when they retire. Taxes will go up and inflation is coming.

If you try to bulk up your retirement funds, don’t choose a vehicle that will be taxed to the max later. You could outlive your savings.

Consider that, at 5 percent inflation, the cost of living doubles every 15 years. If your nest egg generates $6,000 a month in income, it will only buy $3,000 worth of goods and services 15 years from now. In 30 years, it’s down to $1,500.

You don’t have to lose sleep while our elected leaders quarrel over the Bush tax cuts. You can rest easy using sound strategies such as indexing and maximum-funded insurance contracts.

Meet with a Missed Fortune advisor to get started planning your future.

Bonus Missed Fortune E-Book: Baby Boomer Blunders

The average Baby Boomer has less than $50,000 accumulated for retirement (which means many have less than that), primarily due to bad habits and having money invested in the wrong places where economic downturns can diminish their nest egg.

Download this e-book now at www.babyboomerblunders.com.

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No, Your Nest Egg is not “Safe Again” if it’s in 401(k)s

January 3, 2010

Podcast: Download (23.0MB)

This week Doug Andrew discussed the following:

Upcoming Complimentary Webinar

Attend our free 90-minute webinar live over the Internet this coming Tuesday, January 5th at 11:00 a.m. pacific (12:00 p.m. mountain, 1:00 p.m. central, 2:00 p.m. eastern), and again at 6:30 p.m. pacific (7:30 mountain, 8:30 central, 9:30 eastern).

The topic is “The 401(k)/IRA Dilemma.”

You’ll learn the best alternatives to qualified plans, which provide liquidity, safety of principal, and a healthy, tax-free rate of return that outpaces inflation. You’ll also learn how not to lose when the economy is down.

Register now by calling 888-76-Radio (888-767-2346).

Just for registering you’ll receive a bonus e-book and audio book on the IRA/401(k) dilemma.

Furthermore, all attendees will receive a bonus hardcover copy of Last Chance Millionaire, Doug Andrew’s New York Times best-selling book.

Ridiculous Reports from Traditional Financial Planners

Newsweek recently published an article by Linda Stern entitled “Is Your Nest Egg Safe Again?”. The story reports that large investment firms, such as Fidelity and Vanguard, have performed recent studies “showing that most workers have seen their retirement accounts recover to precrash levels…”

But why? According to the article:

“Both firms (Fidelity & Vanguard), which provide 401(k) accounts, reported that most of the workers in their programs now have more money than they did when the stock market started its slide in 2008. The primary reason, they reported, was that continued employee contributions helped to offset declines in balances.”

Huh?

In other words, these funds haven’t grown in terms of a rate of return! Financial services companies with vested interests are trying to pull the wool over your eyes by making you think that everything is okay with risky qualified plans.

Think about it: Your account is worth $100,000. The market tanks and you lose $25,000, so you’re left with $75,000. You then make an out-of-pocket contribution of $30,000, taking your account balance up to $105,000.

You’ve still lost and have not recovered from the $25,000 loss, yet according to large investment firms (which, of course, offer 401(k)s), your account is doing just fine.

To add insult to injury, these deceivers recommend that people nearing retirement age increase their risk to make up for lost time:

“At an age when they are typically told to eschew risk, older workers may need to take on a bit more investment risk in the hopes of snagging bigger returns going forward. People who are five years away from retirement should have 60 percent of their portfolios in stock, argues Christine Fahlund, a senior financial planner at T. Rowe Price.”

If you want to continue losing money, then stick with this advice. But Missed Fortune offers a much better and safer approach.

Escape the 401(k) Trap

Though they’re promoted heavily by the traditional financial services industry, 401(k)s are horrible accumulation vehicles, for the following reasons:

They tax your harvest, rather than your seed.
Contrary to traditional advice, your taxes will most likely be higher, not lower, in the future because you’ll have far less deductions.
The 10% withdrawal penalty prevents you from accessing the money when you need it most.
The accounts come with strict and constricting rules, such as mandatory withdrawal by age 70 and a half. If you don’t meet the guidelines you could be subject to a 50% penalty.
The accounts are subject to estate taxes, meaning that your heirs could be left with as little as 28% of your account balance when you die.

You need to escape this trap now while taxes are less than they’ll ever be. The Missed Fortune asset optimization strategies provide a way for you to roll your money out of qualified traps and into accounts that solve all the problems of 401(k)s.

Click here to get started now.

Bonus Missed Fortune E-Book: Baby Boomer Blunders

The average Baby Boomer has less than $50,000 accumulated for retirement (which means many have less than that), primarily due to bad habits and having money invested in the wrong places where economic downturns can diminish their nest egg.

Download this e-book now at www.babyboomerblunders.com.

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Taxed-As-Earned & Tax-Deferred Versus Tax-Free

November 12, 2009

A dollar doubling every period for 20 periods will grow to $1,048,000 if it is growing tax-free.

But if it’s taxed-as-earned, assuming a 25% marginal tax bracket, that money will only amount to $72,000. And in a 33% tax bracket, it would only be worth $27,000.

If that money grows on a tax-deferred basis, it will only be worth $666,000 when you withdraw.

It’s critical that you harness the power of compounding interest on a tax-free basis.

*If you are getting this feed in RSS or email and cannot see the video, please click on the header to view it on the blog.

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Would You Rather Have $1 Million, Or $72,000?

October 27, 2009

Recently, we discussed the concept that “time is money.”

We pointed out every 90 days that go by without implementing asset optimization strategies that leverage maximum-funded, tax-advantaged insurance contracts can result in a loss of $100,000 or more in future retirement resources (when tax savings are calculated into the equation).

compoundinterest 300x199 Would You Rather Have $1 Million, Or $72,000? Well, there’s even more to the issue of the time-value of money.

Consider this: A dollar doubling every period for 20 periods tax-free would amount to over $1 million by the end.

However, if it were taxed as earned (in a 25% marginal tax bracket, which most Americans are in) as it doubled over the same 20 periods, it would only be worth $72,000.

Why is that?

When it’s taxed as earned, you have to pay tax on the gain every period.

So at the beginning, your money doubles from $1 to $2. You pay tax on that gain. Then what’s left doubles again, and you pay taxes on that gain — and so on for 20 periods.

By the end, if you’re in a 25% marginal tax bracket (as most Americans are on their last dollars earned), instead of $1,048,000, you would have $72,000.

Now that’s if you’re in a 25% marginal tax bracket. If you live in 41 of the 50 U.S. states that have a state income tax, you’re more likely to be in a 32 to 33% tax bracket.

And if the government eventually increases taxes to cover the skyrocketing federal debt, some experts estimate you could end up in a 50 to 60 percent tax bracket.

It would be far better to accumulate your retirement savings on a tax-free basis. Even if you’ve already started saving in 401(k)s, IRAs or other qualified plans, you can start now to transition your money through strategic roll-outs and be on your way to accumulating your wealth tax-free.

It is indeed possible to optimize your assets in savings accumulation vehicles where your money: 1) accumulates tax-free; 2) can be withdrawn tax-free (even before age 59 ½ – without penalty); and 3) transfers to your heirs tax-free when you pass away.

Find out more and begin now to empower yourself, and your financial future.

Isn’t it time you became wealthy?

Tagged as: Compound Interest, tax brackets, tax-free accounts, Taxes, wealth accumulation