Tax deferral is a con, and I’m going to prove it to you.
Actually, I’m going to let you prove it to yourself, with this 5-second experiment.
The conventional wisdom says, “Maximize your contributions to tax-deferred plans, like 401(k)s, IRAs and 403(b)s. Your money compounds without being reduced by taxes, and you’ll end up with more money during retirement.”
But is it really true?
The Society of Actuaries says that if the tax rates are the same, “It doesn’t make any difference whether [the taxes] are taken away from you at the beginning (tax-exempt) or at the end (tax-deferred). It’s the same fraction of your money that is left to you.”
But most people look at their savings and think it’s all theirs. You may have forgotten you’ll owe the IRS the taxes you deferred all those years – on every penny you’ve put in and every penny of growth.
If the tax rates miraculously manage to be lower during your retirement, you might come out ahead by deferring your taxes. But where do you think tax rates are headed long term? You must consider what tax rates might be during a retirement that could last 30+ years. [Read more…] “Tax Deferral is a Scam and Here’s Proof”
In his first 100 days in office, President Biden unveiled three colossal spending packages earning him the nickname, “The Six Trillion Dollar Man.”
Biden and Congress are just getting started with the most massive expansion of government since FDR’s New Deal during the Great Depression. Apparently, it’s desperately needed, even though the pandemic-caused recession is over.
This is a government that is notorious for wasting hundreds of billions of our hard-earned dollars every year. Think $518,000 to study how cocaine affects the mating habits of Japanese quails, $998,798 to ship two 19-cent washers from one state to another… and the list goes on. You couldn’t make this stuff up if you tried!
And let’s not forget this is a government with a long history of not being able to make much of a dent in controlling fraud and abuse. The government admits that more than $134 billion of improper Medicare and Medicaid payments were made in 2020 alone – and that’s just one government agency. [Read more…] “When Does Taxation Become Theft?”
Updated March, 2022
Our national debt now exceeds the size of the entire U.S. economy, doubling just in the last decade. And it’s growing at a rate that will make your head spin, as a quick glance at the U.S. Debt Clock reveals:
The Congressional Budget Office (CBO) says this deserves attention
Americans will be paying for this for decades.”
Which Means that Higher Taxes are Inevitable and You Must Take Action TODAY to Protect Yourself from the Coming Tax Tsunami!
And the reality is that they can’t possibly raise enough revenue taxing just the “wealthy.”
Did you know that, according to the most recent data available, if you make $69,007 or more, you’re in the top 25% of wage earners? And if you make $118,400 or more, you’re in the top 10%.
As nice as it may sound to be in the top 10% or even the top 25%, it also means you’ve got a giant target on your back when the government is looking for more revenue to cover its obligations.
There are little-known, but legal ways to protect yourself from this tax tsunami, under current tax law. This article explains what you need to do today to shield yourself from some very unpleasant tax surprises down the road.
(Download a FREE Special Report that Reveals How to Bypass Banks and Wall Street, Gain Control of Your Money and Shield Yourself from the Coming Tax Tsunami) [Read more…] “6 Ways to Protect Yourself from Taxmageddon”
Jason is 53 years old and just changed jobs. He’s facing two retirement planning dilemmas…
- He has $830,000 in his 401(k) from his previous job and wants to move it where it gives him more guarantees that he and his wife, Julie, won’t outlive their money in retirement.
- He had been putting $19,000 a year into his old 401(k) and wants to continue socking away that much. But in the last couple of years he experienced several downsides to 401(k)s that have soured him on the idea of continuing down that path.
The Five 401(k) Drawbacks Jason Discovered…
Drawback #1: When the pandemic hit, Jason’s employer stopped doing any matching contributions, which had been a big incentive for him. He’d forgotten the employer match isn’t guaranteed.
Drawback #2: As Jason gets closer to retiring, he has much less of an appetite for risk and volatility. What if the market crashes again shortly before he plans to retire in 14 years at age 67?
He’d been saving diligently in a 401(k) for 29 years already, and his average annual return had been less than 6%! Sheesh! All those sleepless nights and heart-stopping crashes… for less than 6% a year?!? He wondered if a monkey throwing darts couldn’t have done better than that… [Read more…] “How to Trade In Your 401(k) for an Increasing Guaranteed Income for Life”
Jon and Jen have an opportunity to buy their dream home and lock in a historically low interest rate. This is a pretty common scenario in today’s market. In fact, you may be thinking about buying a home or refinancing your mortgage to take advantage of today’s low rates. If so, here’s a powerful option to consider…
Jon and Jen are trying to decide whether a 30-year mortgage or a 15-year mortgage makes the most sense. Their mortgage broker showed them that even with an interest rate just 0.65% lower, the 15-year mortgage would save them almost two-thirds of the interest of a 30-year loan.
They decided the 15-year mortgage made the most sense. Their thinking was, “We’re both 48 now, and we plan to work until we’re 70. The sooner we get the house paid off, the sooner we can save more for the future. Plus, we really like the idea of saving almost $90,000 in interest.” [Read more…] “A Surprising Solution to the 15-Year vs 30-Year Mortgage Dilemma”
Would it surprise you to know that the #1 retirement fear is running out of money – a fear shared by fully half of Americans? That’s according to a recent study by the Aegon Center for Longevity.
People are deathly afraid of running out of money in retirement for good reason, experts say…
Over the last 40 years, there has been a dramatic shift away from company pension plans that promised workers a certain amount of money every month in retirement for as long as they lived.
Instead, there’s been a seismic shift toward do-it-yourself, cross-your-fingers, hope-and-pray retirement planning strategies like 401(k)s and IRAs. [Read more…] “How to Never Run Out of Money in Retirement – the Solution Top Experts Recommend”
President-elect Joe Biden has repeatedly said he will increase numerous taxes and eliminate the Trump tax cuts on “day one,” which would impose a $2,000 annual tax hike on a median-income family of four.
He has promised to as much as double the capital gains tax rates on your investments.
Biden/Harris have proposed canceling student loan debt and are being encouraged to do that by executive order as soon as possible. It would add hundreds of billions of dollars to our already-skyrocketing national debt.
In reality, there’s no such thing as “canceling” or “forgiving” student debt – they can call it anything they want, but it simply means sending the bill to the taxpayers.
Biden wants to raise the corporate tax rate by 33%. [Read more…] “Taxmageddon is coming – Here’s How to Protect Yourself”
I’ve spent the last two decades proving there are many investing and retirement planning myths, lies, and fairy tales that most people and financial representatives blindly accept as fact.
It’s really not their fault. Wall Street spends billions of dollars every year to brainwash us.
As the late President John F. Kennedy observed…
The great enemy of the truth is very often not the lie – deliberate, contrived, and dishonest – but the myth – persistent, persuasive, and unrealistic. Belief in myths allows the comfort of opinion without the discomfort of thought.”
Here are 3 fairy tales you’ve probably heard from your financial advisor and the facts about each:
Fairy Tale #1: You Must Risk Your Money in Order to Grow an Adequate Nest-Egg
This is undoubtedly Wall Street’s BIGGEST lie. [Read more…] “What Fairy Tales and Myths is Your Financial Advisor Feeding You?”
Recent studies and surveys show that pre-retirees and retirees fear these five threats to their retirement finances most – and with good reason. Which of these keep you up at night?
Retirement Security Threat #1: Outliving Your Money
This is such a big and scary threat that some people say they would rather die before their time than run out of money.
Unfortunately, the likelihood of outliving your money is all too real. The average 65-year-old will outlive their savings by almost a decade, according to a recent study by the World Economic Forum.
To determine how much money you’ll need to have saved by the time you retire, a good guideline is the “Rule of 25,” which says you should multiply your total annual expenses by 25. By that measure, to have $100,000 per year (don’t forget to adjust for inflation) to spend in retirement, you’ll need to save $2.5 million.
It’s also important to consider that you may well live longer than you imagine, and studies show people tend to underestimate their life expectancy.
Retirement Security Threat #2: Market Risk
[Read more…] “The 5 Biggest Threats to Your Retirement Security Today”
When the Coronavirus pandemic and shutdown hit, millions of people found themselves out of a job, and many others had their hours and pay cut.
The government stepped in to provide stimulus, but many people had to wait weeks or even months to receive it.
And just when many people needed fast access to cash, charge card limits were reduced or even canceled without warning.
As Mark Twain wryly noted…
A banker is a fellow who lends you his umbrella when the sun is shining, but wants it back the minute it begins to rain.”
Bank On Yourself Comes to the Rescue…
When you need fast access to cash, what’s the fastest and easiest way to get it? A Bank On Yourself policy loan because it’s money you can get your hands on: [Read more…] “Why the Best Way to Get Cash Fast is a Bank On Yourself Policy Loan”