The Jet Plane for Retirement Savings

if you’ve got a 401k an IRA or a pension plan I’ve got some really bad news for you the IRS wants you to think that these so-called qualified plans are the best way to save money for retirement they induce you to max out your plans by giving you tax breaks right now and allowing your money to grow tax-free over the years sounds pretty good right wrong the fact is that putting money in your 401k or IRA is almost the worst thing you could do for your retirement because you’re going to be taxed out of your gourd when you finally retire and need the money the most then when you die guess what the IRS will hit you with a double whammy they’ll tax your estate when you die then they’ll tax whatever is left again when it is inherited by your heirs and on top of the tax problems you’ll also have to deal with market volatility that can kill your portfolio just think about 2001 in 2008 what if there were a way to avoid tax burdens at retirement avoid portfolio killing down years in the market and virtually eliminate any worries you may have about outliving your money during retirement on this video I want to show you an IRS approved class of tax friendly retirement savings vehicles that beats the pants off your IRA 401k or pension plan they’ve been around for years are offered by the oldest largest and most financially stable institutions in the world and allow your money to grow tax-free just like your current qualified plan but has zero taxes when the money is dispersed at retirement think about that for a minute zero taxes on your state when you die and zero taxes when the money is transferred to your heirs at death listen to that one more time zero taxes as your money grows zero taxes when the money is distributed and zero on your estate when you die and zero taxes on the money inherited by your family zero and here’s the best part unlike your qualified plan there is no risk that you will lose principle on the investment during a down market if the market tanks like it did in 2008 your worst case scenario is no gain but no loss either what I’m talking about is a retirement savings vehicle that will help make sure you don’t outlive your money during retirement are you intrigued well you should be I want to take a few minutes right now to share with important message about the best retirement savings vehicle you’ve never heard of let’s start by talking about the IRS they desperately want you to think that an IRA is the best way to grow your money for retirement you know what it’s not even close I’m talking about what the IRS calls qualified plans IRAs 401ks pension plans and so forth compared to traditional brokerage accounts where you normally buy stocks bonds and mutual funds these qualified plans have some really good tax advantages first you can invest in a qualified plan with before tax dollars number two you don’t have to pay taxes on these games every year like you do on regular stocks of mutual funds so your money grows tax-deferred it’s not taxed until you take the money out when you finally retire that means you have more money working for you during those years leading up to retirement sounds pretty good right well yeah compared to a regular brokerage account sure but that’s like saying a bicycle is the best mode of transportation going of course a bike beats the heck out of walking especially if you’re trying to travel outside of your immediate neighborhood but what if you’re trying to travel across town or clear across the country you might want to try a car and what if you’re trying to get overseas walking’s out of the question and that bicycle is pretty much worthless you’d be much better off in a jet plane so just to make sure you’re following my analogy a regular brokerage account is like walking lots of tax problems a qualified plan is like a bicycle or maybe even a beat-up old car better than walking but not super helpful on extra long trips like say retirement but I’m gonna show you on this video is like having your very own top-of-the-line private jet fully fueled and ready to go with your own personal pilot yeah it’s that much better the key to really maximizing your retirement savings is to understand the difference between tax deferred and tax-free under the IRS qualified plans that you probably have right now your money is growing tax deferred which inherently means that it will be taxed at some point in the future guess when that point is that’s right when you retire and need the money the most you prop we won’t be working tax rates we’ll probably even be higher than they are now and you won’t have any IRS friendly deduction for kids or mortgage interest if your house is paid off which means that you’ll be paying a huge percentage of what you take out to the IRS in taxes which of course reduces the amount that you have to spend for living expenses and lifestyle here’s another way to look at it Uncle Sam is counting on you to pay more than your fair share of taxes when you retire think about brilliant that is let’s encourage people to contribute money by giving them a tax break now then let that money grow tax-deferred so we can get an even bigger chunk of taxes from them later hey I’m all for paying my fair share of taxes but I tell you what

giving the IRS a bare minimum of $33,000 for every $100,000 I withdraw from my qualified plan of retirement just plain ridiculous look youth pay taxes and you’ll continue to pay taxes for your entire working career let’s keep the government’s hands out of our wallets at retirement okay for the record that $33,000 out of every $100,000 you withdraw isn’t a worst-case scenario either you realize that don’t you with the probability that tax rates will rise it’s probably actually a best-case scenario any right-thinking person can see that the tax rate of 40 or 50 percent isn’t out of the question 15 or 20 years down the road so let’s talk about this so-called jet plane of retirement savings vehicles you know the one that beats the pants off a regular brokerage account or qualified plan before I tell you exactly what it is let me show you some of the major advantages it holds first tax free accumulation just like a qualified plan and way better than a brokerage account your money grows year after year without having to pay taxes on the annual gains compound interest can then work its magic which allows your money to grow bigger and faster we don’t need to have a discussion about compound interest do we if you’re not familiar just go to google and type the greatest miracle of growing money ever known to mankind and find out about the greatness of compound interests second tax-free distribution here’s where your current qualified plan starts to look really bad when you hop on board the jet plane of retirement savings vehicles your money not only grows tax-free but you can also actually distribute the money at retirement tax-free that means that on the same $100,000 distribution I just talked about you keep all of it regardless of the then current tax rate 30% tax rate you won’t care you’ll pay no taxes 40 or 50 percent tax rate let everyone else worry about that your retirement savings can be used tax-free $100,000 means $100,000 to spend not sixty seven thousand dollars or less which do you prefer third tax-free transfer with a qualified plan or with a regular brokerage account your money will likely be taxed twice when you pass away once on the amount left in the account when you die and then again when your heirs receive the leftovers as income great for the IRS horrible for your estate the jet plane of retirement savings vehicle lands smoothly here – no death taxes no inheritance taxes if you’ve got a million bucks in your account when you die your heirs get the full million Uncle Sam nothing transfer tax laws are however fairly complicated and there’s some exceptions and some limitations so ask the qualified advisor who gave you this video to discuss your situation with you fourth no risk of loss of principle remember when the stock market lost over a half its value in less than 18 months starting in October 2007 of course you do because your portfolio probably lost half its value or more during that same time – did you start having nightmares about being 82 years old and still working part-time at Walmart just to keep food on the table your qualified plan has no way to protect you from that kind of market volatility and downside losses ouch not true with the jet plane of retirement savings vehicles the principal in the account never loses altitude when structured properly there’s no chance it will lose any principle not a dime not a penny nothing if you’ve been on board with this in October 2007 your portfolio would probably look a whole lot prettier right now I’ll explain why in half just a minute fifth dramatically reduce the chance of outliving your money during retirement survey after survey show that baby boomers number one fear about retirement is outliving their money and hey you know what that’s a perfectly reasonable fear if you ask me if you have a million dollars saved and you retire at age 65 that’s pretty good if you only plan a living until your say 70 or 75 and if you don’t have any significant medical issues but how do you stretch a million dollars or whatever amount you end up having saved by the time you retire for 15 or 20 or 30 years especially given the increase in cost of living in the likelihood of needing specialized care if you do end up living into your late 80s or 90s not to worry if you ride the jet plane of retirement savings vehicles when structured and funded properly it’ll keep on paying and paying and paying all three or 70’s 80’s 90’s and even beyond that if you’re lucky enough to hit a hundred hey you’re more likely to hit a hundred if you’re not stressed out over money time to get on board okay okay there are even more advantages and I’ll cover them in just a minute but first let me address that question that I know is nagging you in the back of your mind you’re saying to yourself right now okay this all sounds great everything you’ve said so far makes a lot of sense and I’m interested but hey pal what’s the catch we all know that anything that sounds too good to be true probably isn’t hey I hear you between Enron Bernie Madoff and the great stock market meltdowns of the 2000s a healthy dose of cynicism skepticism or both is not only understandable it’s just plain smart I’ll tell you what the catch is and

trust me it’s more like six seconds of turbulence on your six-hour flight to Hawaii on your personal jet plane than a catch but first a quick reality check just because you’ve never heard of this before doesn’t mean that it doesn’t exist doesn’t mean that hundreds of thousands of people aren’t already using it and doesn’t mean that all of the advantages that I’ve talked about aren’t absolutely real and sitting there just waiting for you so here’s the six seconds of turbulence catch / IRS rules you have to fund the plan I’m telling you about with after-tax dollars in other words you can’t deduct the amount you contribute off your current year’s taxes like you can with a qualified plan that means that if you were to six thousand dollars this year in an IRA verse this retirement savings vehicle you’d in reality pay an extra two thousand dollars in taxes this year assuming a 33 percent tax bracket if you’re in a lower tax bracket naturally your tax savings would be less that sounds like a drawback right well actually no to understand why funding with after-tax dollars instead of before tax dollars like you would with a qualified plan is not a drawback you just need to understand the alternatives answer this philosophical question if you are a farmer would you rather pay taxes on the small sack of seeds when you purchase them in the spring or would you rather pay taxes on your entire harvest when you sell it in the fall well do the math if a farmer bought $1,000 worth of seeds it was taxed at 8% he paid 80 bucks but at the farmer planted those seeds and paid the same 8% of taxes on a $50,000 harvest he’d pay four thousand dollars in taxes 80 versus four thousand that’s a fifty times increase in taxes paid the same rationale applies to your retirement savings in fact the amount of money you save on upfront taxes with a qualified plan remember you’d save $2,000 in taxes by making a six thousand dollar contribution into qualified plan okay will almost certainly be dwarfed by the taxes you pay at retirement to the tune of about ten times at least here’s why if you’re six thousand dollars grows to a hundred thousand dollars over the course of the next thirty years remember the magic of compound interest this is very reasonable you’ll pay at least thirty three thousand dollars in taxes on the harvest we already talked about this earlier that’s thirty three thousand dollars straight to the IRS right when you’ll be needing it the most would you rather pay two thousand dollars in taxes right now or thirty three thousand dollars at least in taxes later it’s as simple as seeds and harvest I’ve said it once and I’ll say it again no wonder Uncle Sam loves qualified plans so much it’s his way of protecting his financial future okay okay so let me go ahead and draw back the curtain and show you what the jetplane of retirement savings vehicle is just to be a favor and hear me out because I’m gonna admit right now right up front that might sound a little well boring right at first that’s because it’s a life insurance product called indexed universal life contract or iul for short stick with me skipper don’t be fooled by any stereotypes of what you may think and IUL is this is different than any kind of whole life or variable life or universal life plan that you may have heard about or purchased in the past the fact is I ul is a lot more about savings than it is about life insurance although it does do a nice job of providing that to hopefully the tax advantages in principal protection advantages I’ve told you about are clear enough and big enough to keep you interested but you also need to know that the IUL when structured and funded properly beats the pants off of any other kind of retirement savings plan in every comparison category that matters including growth potential risk avoidance liquidity of funds flexibility of contributions flexibility of distributions longevity of distributions and fees everything listen insurance companies by law and by track records are extraordinarily conservative yeah I know that AIG tanked it and you might be thinking that all insurance companies are going bust nothing could be farther from the truth life insurance companies that offer iul-s as a rule have massive massive cash reserves one company as an example had operating revenues in 2008 the worst year of the recession of 14 billion dollars earnings of 1.3 billion dollars and cash reserves at the end of the year of twelve point eight billion dollars there’s a reason people think of life insurance companies as old stodgy conservative curmudgeons because they are their stodgy chrome mugginess is also a part of the reason you’ve never heard of an IU L before life insurance companies thrive with things like risk management actuarial tables and other boring life insurance stuff but they don’t know jack when it comes to communications go online right now and read their brochures it’s like reading hieroglyphics boring painful obtuse hard to understand and that’s just the table of contents but that doesn’t mean

this product indexed universal life is anything less than magnificent for creating wealth the IUL indexed universal life gets its name because it’s indexed to the S&P 500 which simply means that it mirrors the growth of the S&P 500 which for your information has returned over 9% per year on average for the last 27 years even with all the crummy years in the 1980s right after 9/11 in 2007 and 8 remember that but here’s the best part and what makes an eye ul so darn attractive as a retirement savings vehicle the reason I ul accounts when structured properly won’t lose principle is because the lowest return guaranteed by the contract is 0% or in technical speak they have a floor return of 0% they can’t lose money if the stock market tanks for the year your eye ul contract doesn’t take a big hit it just stays even right where it is stated differently and IUL locks in the gains during up years but it doesn’t participate in the down years take that IRA you can’t even come close to competing with that everyone knows that portfolio losses are chillers because you have to double up just to get back to even you eliminate that risk with the IUL since your floor is zero percent annual growth no loss of principal compare that to the devastating 37.2% loss of the S&P 500 in 2008 if you were indexing your IRA against the S&P 500 and therefore did not have the 0% floor like you would with an IU L contract if you had a 1 million dollar portfolio on January 1st of 2008 you would have ended the year with just six hundred and twenty eight thousand dollars ouch even with the big bounce back year of 2009 where the S&P returned 23.6% the six hundred and twenty eight thousand you had left after getting killed in 2008 would have only grown to about seven hundred seventy five thousand dollars still deep in the hole not with an IU L now that brings us to the other catch of the IUL it does offer the peace of mind of the principal protecting 0% floor but it does also cap the gains on the upside that when the market has a huge growth year your investment will be capped at somewhere in the 12 to 15% range depending on the carrier in the contract don’t bail out on me now trust me this is not a big issue in fact quite the opposite we’re talking about six more seconds of turbulence on your six-hour smooth plane ride to Hawaii here’s why realize that huge gain years almost always follow what that’s right huge lost years 2003 for instance was great twenty six point three percent gain in the sp500 but it followed three consecutive years 2000 2001 and 2002 of negative returns twelve point two thirteen point four and twenty four point one percent respectively negative all three years let’s run those numbers if you had a million dollars in your IRA on January 1st 2000 it would have fallen to approximately eight hundred and seventy eight thousand at the end of the first year then continued to fall to just over seven hundred and sixty thousand at the end of 2001 and then plummeted to a measly five hundred seventy seven thousand at the end of 2002 that’s a million dollars in a loss protected IUL would have retained its worth at a million dollars at the end of 2000 even though the market was down remember still been worth a million dollars at the end of 2001 and guess what still worth a million dollars after 2002 even though the market got slaughtered that’s three consecutive down years and four hundred twenty three thousand dollars in avoided losses Wow then in 2003 let’s say that you were with an IU L carrier that had a thirteen percent cap remember the big downside catch it has a cap your million dollars would have grown to one point one three million dollars it grew meanwhile the qualified plan portfolio that tanked from a million dollars down to just five hundred seventy seven thousand dollars remember that one it would have gotten the full benefit of the twenty six point three percent market gain not a thirteen percent cap like our iuo contract yay but let me ask you this would you rather had 13% to a million dollars or twenty six percent to five hundred and seventy seven thousand dollars twenty six percent added to five hundred seventy seven thousand dollars only brings the account up to about seven hundred and twenty eight thousand dollars again compared to one point one three million this is a no-brainer at the end of the four year cycle you would have been ahead by over four hundred thousand dollars with an IUL this is real money in a worst case scenario the only way a qualified plan could possibly do better is if the S&P were to go up unfettered by over 15% per year for five or ten consecutive years with zero negative years do you really think that’s going to happen and even in the one-in-a-million chance that it did get ready to pay the tax man when you retire I know these numbers can start to be a bit mind-numbing but they’re so critical for you to understand so you can see how

to avoid getting crushed financially when you retire don’t be afraid to rewind the video and watch that last section or the entire video again I want to continue with the examples just a little bit further we stopped our examples at the end of 2003 remember the IUL account that started with a million dollars had weathered the storm and grown to one point one three million the IRA account hadn’t done so well and had managed to eke back to seven hundred and twenty eight thousand dollars but only after a really strong 2003 now let’s look at what happened in two thousand four five six and seven the S&P gained in this order seven point two one point two twelve point eight in one point two percent in those four years your IUL account since it’s indexed to the S&P 500 and since all of the games were between the zero percent floor remember that and the 13 percent cap your IUL would have taken all of those same gains seven point two one point two twelve point eight and one point two percent that would take your one point one three million dollar account right to around 1.4 million by the end of 2007 pretty good right then when the S&P got shellacked to the tune of thirty seven percent lost in 2008 since the lowest return your IUL account can get a zero percent guess what the ul account would have held steady at 1.4 million dollars no loss nice isn’t it on the other hand the IRA account would have grown from 728 thousand to about nine hundred thousand dollars during those four good years still down by a hundred grand since 2000 just in time to get crushed clear back down to five hundred sixty five thousand at the end of 2008 what would you rather have going into 2009 $565,000 or 1.4 million this isn’t a retirement savings vehicle for the ultra-conservative it’s a retirement savings vehicle for the ultra-intelligent if you think market caps of twelve to fifteen percent or a poor trade-off for a contractual guarantee of a 0% floor you’re just plain crazy naturally past performance isn’t an indicator of what will happen in the future but I think it’s safe to say that the market is going to have up years and down years protecting yourself from huge losses is one of the primary advantages of the IUL it’s impossible for me to overstate how superior the IUL is compared to your qualified plan it’s not even close we’ve already covered the tax advantages they’re clear and evident the risk avoidance issue is huge and it favors the IUL by a country mile but also remember indexed universal life is also yeah life insurance here’s what that means if you die the day after you fund an IUL policy or anytime thereafter your heirs will receive a death benefit tax-free the amount of the benefit depends on the size and structure of your policy but think about your qualified plan and brokerage accounts for just a minute how much do they pay in death benefits if you were to die early oh yeah none because they’re not insurance are you starting to see what I mean by the best retirement vehicle you’ve never heard of hey that reminds me let’s talk a little bit more about why you’ve probably never heard of an IU well before I already told you that one of the main reasons was that stodgy old insurance companies have horrific communication skills but there’s actually a bigger reason which is financial advisors almost never talk about IUL why is that simple math only licensed insurance agents can legally sell you in IUL and most license money managers and brokers are not licensed to sell insurance in other words the guy who sells your IRA can’t by law sell you an indexed universal life policy and if you can’t sell it it can’t make any money on it end of story your financial planners motivation is to get you signed up for an IRA or 401k and then make money on you for life as your investment grows they don’t care about your future tax burden why should they seriously call your investment advisor on the phone right now and ask about an IU L chances are 99% he or she has never even heard of it and if they have they have zero working knowledge of how or why it works how would they know they don’t know insurance products they like to think they have a corner on the market of helping people save enough money to retire but they don’t they’re selling skateboards bicycles or roller skates and pretending like the big shiny private jet doesn’t even exist the fact is the IUL is the best possible wealth accumulation vehicle for your retirement for most people and in most situations it simply cannot be beat for tax advantages safety growth potential liquidity and flexibility all right just one more quick topic and then we’ll let your licensed insurance professional take over and discuss all the fine point details as they relate to your specific situation and that topic is the logistics of how the IUL works it works like a life insurance policy in the sense that you make monthly or annual contributions into your account you will work with your advisor determine what the optimal amount is for your situation it’ll vary depending on how many years you have left until retirement your financial goals for retirement in your current financial ability the money you contribute to an IUL like we’ve discussed at length will continue to grow tax-free unlike a qualified plan account you may have access to your

money at any time you want or need it without a penalty before or after you retire that’s what’s called flexibility when you do pass away the balance of the account will be passed to your heirs tax-free just like with any other life insurance policy the IUL really does offer the absolute best of all possible scenarios it’s tax friendly it’s safer than safe and it gives you flexible access to your money the next step is yours you simply need to meet with a licensed insurance professional who gave you this it disgusts your particular situation he or she will answer all of your questions I’m sure you have several and discuss all of your options you may want to consider watching this video again this time with a pen and paper handy to jot down any notes or questions you may have like anything else worthwhile there are plenty of details to be covered and there’s a bit of a learning curve but whatever you do don’t do nothing there’s too much at stake don’t fall prey to what I call the law of diminishing intent you know what I mean you intend to make the call and learn more but you get overwhelmed with a thousand little urgencies of life and you look up and a few months or even a few years have passed and you haven’t done anything so take one action right now set an appointment to meet with the insurance professional who gave you this video you can do so by either calling the number on the screen or by filling out the form at the website shown on the screen right now that’s it do that one thing right now and take a closer look at the jet plane of retirement savings vehicle indexed universal life you’ll be glad you did