Some retirees underestimate the impact a big market loss may have on the future of their income. Luckily, insurance can be used to protect more than just your physical assets. It can also be used to help protect your future. Our firm specializes in helping individuals safeguard their retirement nest eggs by offering a variety of insurance products and financial planning strategies.
Some of our Insurance Services include the following, but not limited to:
- Final Expense Life Insurance
- Life Insurance
- Living Benefits Insurance
- Mortgage Protection Insurance
Gotcha – again!
Are you still investing for the long haul? Buy mutual funds, just a few dollars every month and put them in something that defers your taxes, and like magic, when you are ready to retire, you have several million dollars to buy a Caribbean Island and retire in luxury! I mean, these things return 6, 10, even 12 % on your money, so just put your money in here and hope for the best. Let’s have a Dr. Phil moment, how’s that working out for ya?
The just released 2019 Quantitative Analysis of Investors Behavior Report by DALBAR, the leading independent, unbiased investment performance rating firm, paints a much different picture. Their study ran for the last 20 years, ending December 31, 2018.
The typical investor in equity mutual funds got an average annual return of 3.88%. That’s a long way from 6%, let alone 12. But wait, that is a “nominal” return, which means it ignores inflation over that 20 years. The same report says that inflation rate was 2.17% per year over that 20 years. So…3.88 – 2.17 = 1.71% on my mutual funds. My real return is an amazing 1.71%. What happened to 6%, or 8%, or 12% like the talking heads on TV and Radio said? The study did take into account the fee charged by your advisor each and every year, but this is usually skipped entirely by your advisor.
However, the study did ignore the deferred taxes you are going to pay when you take that money. Do you really thing Uncle Sam is letting you save this money for your benefit? Those taxes will devour another 22-35% of your savings according to the Center for Retirement Research at Boston College. The study assumes that today’s historically low tax rate, are not going to go up over the next 20-30 years of your retirement.
So, let me ask you 3 simple questions concerning your qualified money (IRA, 401k, 403b, SEP, etc.). Qualified accounts not only defer taxes, they also defer tax calculations.
- Do you believe taxes are going up or down in the future?
- Would you prefer to pay taxes on the seed or the harvest?
- Is the value of a dollar going up or done?
None of those make sense.
Other investors actually did worse according to DALBAR. Asset Allocation mutual funds, which spread your money among a variety of different classes earned – are you ready- 1.87%.
Take the 2.7% away for inflation and you’ve lost 0.3% per year for the last 20 years.
But… it gets worse!
Fixed Income Funds managed a return of 0.22%. So…with inflation, you dug a hole by about -2% per year. Not sure that’s what you signed up for.
The DALBAR study says, “The results consistently show that the average investor earns less – in many cases, much less than the mutual fund reports would suggest”. Truth is, most people have no idea what their investments returned over time. Most people believe the mutual fund report – which isn’t the truth. The Federal Reserve Survey of Consumer Finance says the average family has $135,000 in their combined retirement accounts = about $600/month income, taxable.
Wall Street’s BIG lie is that you must risk your money in order to grow it. It’s not true. Our Be A Bank strategy made money every single year with zero market risk for over the last 150 years, including the Great Depression and The Great Recession just a few years ago.
- Your money is guaranteed to grow every year.
- Your account value is locked in and won’t drop even when the market drops or crashes, again.
- Enjoy a significantly higher rate than CD’s or Banks
- You have full access and control of the equity in your plan to use however you wish, without taxes and penalties.
- You can learn to use the money in the plan to eliminate banks and financial institutions from your business or life, forever.
If you would like to see the difference a “Be A Bank” strategy can have on your financial life without taking on all the risks, just request your free, no obligation analyses and we will show you how to build real wealth, safely and predictably.
Schedule your appointment to see what we can do for you!
Phone (317) 697-6321
Your Wealth Must Reside Somewhere!
Your wealth must reside somewhere! It must have a permanent place of residence. You must own, control, and have use your money, or you haven’t built any wealth, you just stashed some money away. About 90 % of Americans keep their wealth in either taxable, unavailable, and/or volatile residences that limit what you can do with their money. If what you thought was true about your money, wasn’t true about your money, when would you want to know? I first heard this question from Don Blanton, a fine southern gentleman with a distinct southern Georgia drawl, and I’ve been unable to “unhear” it, since.