Independent Registered Financial Consultants Bellevue & Seattle - 425-829-4110
If you think future tax rates will be higher than they are today, does it make sense to save money to accumulate wealth in accounts that defer, or postpone or delay, taxes to the future.
Learn how to Avoid the 401(k)/IRA Tax Deferral Trap
For more in depth examination of the cost of the tax deferral trap and case studies showing what can be done to avoid this costly wealth transfer, visit HERE
Select the statement in the column that describes your preference regarding:
| Taxation | Having the ability to delay the payment of taxes on the growth of my cash value | Having the ability to pay no taxes at all on the growth of my cash value |
| Market Risk | Putting my savings directly into market-based investments, where it is at risk of market losses | Having my growth based on increases in a market index, with protection from market index decreases |
| Funding Amount | Having government limits imposed on the amount I can set aside for retirement on a tax-advantaged basis | Having complete freedom to choose how much I want to set aside on a tax-advantaged basis |
| Completion Risk | Leaving my loved ones with my current amount of retirement savings if I die prematurely | Having my retirement savings increase by a substantial amount to leave my loved ones more secure if I die prematurely |
Do you have a plan that implements each one of your preferences?
If you think future tax rates will likely be higher, does it make sense to save money in a tax-deferred vehicle that delays paying taxes to the future when tax rates are higher? Forbes magazine (Dec 13, 2004) warned that most people unknowingly make this expensive mistake when they fund tax deferred accounts like a 401(k), IRA, 403(b) or SEP IRA. Does that describe you, too?
What if you could grow your money tax deferred and access it tax free and without penalty whenever you want for whatever you want with none of the restrictions of qualified plans?
What if your money could earn a market rate of return when the market goes up but not lose a single dollar when the market goes down?
And what if, after doing all this, you could reduce your income taxes by tens of thousands of dollars and more, especially during retirement? Bob and Carol reduced theirs by$149,636; Jeff and Lisa kept $253,824; and Dr Michaels reduced his taxes by $1,062,040.
What are you doing to protect yourself against higher taxes and inflation in the future and avoid the tax deferral trap?
Do you have a comprehensive strategy that -
* Maximizes your capacity to build secure wealth?
* Minimizes the impact of future higher taxes and inflation?
* Allows your money to never participate in losses, only the gains?
* Allows you to access your funds tax free, penalty free, any time you want?
* Provides you with a clear set of directions to implement your strategy and manage your tactical advisors?
* Has your money working safely and predictably for you so you don’t have to work for money?
* Eliminates those ‘what ifs’ that keep you awake at night staring at the bedroom ceiling?
* Enables you to freely choose what to do with your life, where and with whom?
Or, are you hunkered down defensively in bunker mentality, fending off ‘distractions’ and missing opportunities, too busy making a living to have a life?
‘Jeff and Lisa’ knew they’d be in trouble if they stayed in their bunker. They were on track to run out of money well before life expectancy. They implemented two painless recommendations that reduced their income tax burden in retirement by almost over $696,000 and ensured they had adequate income past age 100. Read their story in Avoid The Deferral Trap.
Individuals: Click “Who’s Helping Consumers?” to start your Blueprint program. Learn how to eliminate the “what ifs” that keep you awake at night and how smart cash flow, asset and liability management can increase net worth and decrease taxes for a more secure and prosperous future. Learn how to Avoid The Deferral Trap. Click here now
Business Owners: Start working ON your business at the strategic level eliminating the “what ifs” that keep you awake at night rather than IN your business at the tactical level on tasks you should delegate.
Let’s design a ‘Blueprint’ that enables you to do what you want, with whom and where ever you want. Help yourself and those you care about. Call 425-829-4110 or email scott@scottscholz.com
Lewis Carroll wrote, “If you don’t know where you are going, any road will get you there.” H. Stanley Judd wrote, “A good plan is like a road map: It shows the final destination and usually the best way to get there.”
Select from the short, informative, topical financial planning videos below to expand your body of knowledge. These are Demo videos to provide introductory information on the particular subject. Should you want additional information on any of the topics discussed, call 425-829-4110 or email scott@scottscholz.com
To view the financial planning videos, a name and email is required. You may enter for a name – abc def, and for email abc@def.com and then view the videos.
Addresses the problem of saving enough for retirement and presents an alternative to a 401K that offers tax deferred accumulation of gains, tax free access to the money, and passes to your heirs tax free. Watch it HERE
Want to know how to be your own banker and profit from your own banking? Watch how HERE
Do you want to know how to convert your traditional IRA so your heirs don’t have to pay taxes on the money should you die. Watch HERE
Here’s how to set up a Blueprint that will provide instructions for what to do to settle your affairs when you die. Watch HERE
Do you ever ask yourself:
There are dozens more ‘what ifs.’
Do you have a clear blueprint to guide you through a process to resolve the ‘what if’ and put you confidently on the path to financial security and freedom so you can do what you want, with whom and where ever you want?
Learn our secure wealth building strategies that aren’t subject to conventional market risks and will protect you from higher future taxation and inflation.
Watch these 3 powerful videos titled “Who’s Helping Consumers?” Especially, understand the power of the numbers in the third Case Study video about Bob and Carol. Then, take action to put your questions to rest. Get your own Blueprint in place!
Call for a FREE, no obligation consultation. 425-829-4110 or email: scott@scottscholz.com
Here are 3 essential questions for you to consider when Planning for Retirement:
You can and should know how your current decisions will impact your future lifestyle. Most people are quite surprised by what they are unwittingly doing to themselves.
To help you understand and answer these questions, take a few minutes to watch 3 short videos titled “Who’s Helping Consumers.”
The first is a short Introduction. The second is a ‘Concept’ video that discusses a better way of managing and saving your money and paying off your home mortgage the smart way. The third is a Case Study about Bob and Carol that shows detailed numbers and how much impact one simple change can make. Watch the videos HERE
In Bob and Carol’s case, it saved them hundreds of thousands of dollars in taxes and increased their net worth by nearly 50%! They didn’t spend less or save more each month, either. They just managed their cash flow smarter because they had a clear Blueprint to deliver better results.
Making this simple adjustment has made as much as a $1Mil difference for several families.
What could it mean for you?
Watch the videos. Understand the power of the numbers shown in the Case Study. Call 425-829-4110 to arrange for a consultation to learn how this Blueprint could secure and improve your future.
If there were a way a parent could leave their kids an extra $100,000 to $2,000,000 completely tax free and it doesn’t cost anything extra each month, would you like to see it?
Or,
If there were a way you can leave yourself a $100,000 to $2,000,000 tax free inheritance when your folks pass away and it doesn’t cost you or your folks any extra each month, would you like to see that?
Call for a FREE, no obligation wealth management conversation to see how you and your family can make it work. Call today – 425-829-4110
The Blueprints For Tomorrow Program gets you to start working ON your business at the strategic level eliminating the ”what ifs” that keep you awake at night rather than IN your business at the tactical level on tasks you should delegate. 
If you own a business, do you ever ask yourself…
There are a dozen more ‘what ifs’ that can keep you awake at 2 o’clock in the morning staring at the bedroom ceiling. Eliminate them and achieve the security, freedom and peace of mind you want with our Blueprints For Tomorrow program.
The Blueprints For Tomorrow™ Program is a series of blueprints that help you deal with the “what-ifs” that keep you lying awake at two o’clock in the morning staring at the bedroom ceiling. The Blueprints For Tomorrow™ Program will help you protect what you’ve worked so hard to create, increase the financial potential of your business, and sleep soundly at night.
Many business owners only work in their business, and never on their business. They take on too many responsibilities and waste a lot of time on activities they should delegate. They take care of everyone else first, before considering themselves and their future. They feel they are not running businesses, they are running adult daycare centers. They may have too much of their wealth tied up in their business and they have no exit plan. As well, they may be unnecessarily exposed to many risks such as death, disability, adverse tax consequences, loss of key employees, and lawsuits.
By leaving these important issues unresolved they are jeopardizing their future and the security of the people they care about. There will be disharmony among key relationships in their family and business. They are overwhelmed by worry and concerns and have nowhere to turn for help, and as a result, they lie awake at night worrying about the “what-ifs.” This is why we created The Blueprints For Tomorrow™ Program: to provide a series of blueprints that help you deal with the “what-ifs” and to help you not only make a living, but make a life. It’s a series of real financial strategies for small businesses.
The Blueprints For Tomorrow™ Program is a step-by-step process. In phase one, we have a one-on-one Starter Session to assess if we are the right fit for each other. If we both agree we are the right fit for each other, you join The Blueprints For Tomorrow™ Program. In phase two, we help you choose and implement the blueprints required for your personal situation. In phase three, you take advantage of The Blueprints For Tomorrow™ Toolbox, our full suite of resources and capabilities.
This unique series of blueprints was developed while working with our clients. We help you understand your current situation and create clarity for your future. Then we look at the roadblocks standing in your way and use the blueprints that will work best for your situation. As a result, we don’t leave any stone unturned. We make sure that you’ve covered all of the issues that are important to you.
The Blueprints For Tomorrow™ Program is not for everyone. It is designed specifically for business owners who are willing to invest to better their businesses and their lives. To benefit from the program, you must have strong business sense and recognize the value of working with outside professionals.
As a member of our program, you work through a series of blueprints that help you take care of the what-ifs and enjoy a better life. You can focus on what you do best and delegate non-profitable activities to others. You can create and document a succession and exit plan. You could have written a contingency plan and a clear estate plan. Your assets and wealth can be protected and could be channeled into wealth diversification vehicles. The adverse consequences of potential litigation and a poor economy will be minimized. Your family will be protected and you will enjoy greater family and employee harmony. You will have more free time, and worry less about the details. And, most importantly, you will protect what’s important to you, increase the financial potential of your business, and enjoy a better life.
For information about The Blueprints For Tomorrow™ Program call 425-829-4110
Do you think tax rates will be lower, the same, or higher in the future? How will that impact your lifestyle? What are you doing to prepare and protect yourself against the advent of higher taxes in the future? What are you doing to win the inflation battle that looms out there on the horizon?
Do you have a comprehensive strategy that -
Or, are you hunkered down defensively in bunker mentality, fending off ‘distractions’ and missing opportunities, too busy making a living to have a life?
‘Jeff and Lisa’ knew they’d be in trouble if they stayed in their bunker. They were on track to run out of money well before life expectancy. They implemented two painless recommendations that reduced their income tax burden in retirement by almost over $696,000 and ensured they had adequate income past age 100. Confirm their story in Avoid The Deferral Trap.
Individuals: Click “Who’s Helping Consumers?” to start your Blueprints program. Watch videos to learn how to eliminate the ”what ifs” that bother you and how smart cash flow, asset and liability management for consumers can increase net worth and decrease taxes for a more secure and prosperous future. Learn how to Avoid The Deferral Trap. Click here now
Business Owners: Start working ON your business at the strategic level eliminating the ”what ifs” that keep you awake at night rather than IN your business at the tactical level on tasks you should delegate.
Make us your Financial Architect. Let’s design a Blueprint that enables you to do what you want, with whom and where ever you want. Help us to help you and those you care about. Call 425-829-4110 or email scott@scottscholz.com
Lewis Carroll wrote, “If you don’t know where you are going, any road will get you there.” H. Stanley Judd wrote, “A good plan is like a road map (i.e., a blueprint!): It shows the final destination and usually the best way to get there.”
CHARACTERISTICS OF AN IDEAL INVESTMENT
The Problem:
When it comes to mainstream investments these days, viable options are few and far between. The stock market has been in flux over the last several years by virtue of looming inflation, spiraling oil prices and the constant threat of terrorism. Every government bureaucrat, newsletter author, financial expert, and private investor has a different take on the market’s future. All, if they’re ruthful, will agree that the market’s direction is uncertain.
Another stalwart of mainstream investment has taken a turn for the worse as well. Unsustainable appreciation in the housing sector has cast doubt in the minds of many investors, who once viewed real estate as a safe harbor for their investment dollars.
Even seasoned investors, with no place to turn, are accepting big losses and taking cash positions with little to no profits. They’ve acquiesced to market and economic forces beyond their control to avoid uncertainties and risks. Regardless of their market prowess, no investor can time the next act of terror.
While money markets, annuities and government treasuries offer safety, the return is miniscule after inflation. Conversely, riskier investments with higher yields require impeccable market timing [read: down right luck] to keep from losing not only profits, but principal as well!
So it goes. If investors are to enjoy the double digit returns of years gone by, then they must accept enormous risks, right?
The Proposition:
If there were such a thing as the ideal investment, how would it be quantified?
Recently, a panel of individual investors with diverse goals defined characteristics that would produce such an investment. All the panelists agreed that the ideal investment would possess the following traits:
Safety & Security Diversification No Management Fees
Mainstream Liquidity Performance
Clear Exit Event Win//Win Investment
The Product:
Fortunately, there is an investment product that not only possesses these traits, but excels at each.
The product is called Life Settlements. Life Settlements are purchased by life settlement companies like Life Partners Holdings, Inc. (LPHI). LPHI is the oldest and only publicly traded life settlement company in the United States (NASDAQ symbol LPHI). For many years now, financial institutions including Warren Buffet’s investment arm Berkshire Hathaway, ABN AMRO, Merrill Lynch, Credit Suisse First Boston, and Deutsche Bank have invested HUNDREDS of MILLIONS in life settlement companies for one simple reason: Life Settlements are not subject to any stock market or economic conditions…none!
Statistically, approximately 90 percent of life insurance policies never pay the death benefit because they are allowed to lapse. When they lapse, the insured loses all the money they’ve invested into premiums and their beneficiaries receive nothing. In times past, the only other alternative for the insured was to take a very small cash surrender value amounting to only pennies on the dollar of their original investment.
LPHI offers new hope to these policy holders who no longer need their policies. LPHI will scrutinize each policy closely and will only purchase B+ or better policies as rated by A.M. Best. LPHI only deals with trusted legal reserve insurance companies. Incidentally, since 1845, there has never been a single case where a legal reserve insurance company has not paid a death benefit.
After LPHI elects to underwrite a policy, it will determine its acquisition costs and make a lump sum offer to the insured. Once the offer is accepted, LPHI will divide the policy on the market for multiple investors to buy. The good news is, now, individuals can reap the same rewards the institutional investors mentioned above have enjoyed for years! If an investor buys 10% of the acquisition cost, the investor owns 10% of the policy’s face value. Once the investor’s money is placed into a policy, the investor will know his or her Absolute Payout.
Since 1991, LPHI has a proven track record of greater than double digit annualized ROI; even during crisis abroad and in the wake of 9/11. Why? Again, Life Settlements are completely uncorrelated to the securities markets or economic events.
The Payoff:
So how do Life Settlements from LPHI measure up to our panels’ characteristics of the ideal investment? Let’s review:
SAFETY: On the risk continuum, Life Settlements offer the equivalent safety somewhere between money markets and investment grade bonds.
SECURITY: LPHI and its escrow affiliate, Dunnam & Dunnam are regulated by the SEC and operate under the oversight of the Texas Board of Banking, national banking laws, and Texas Department of Insurance. They are audited by Murrell, Hall, McIntosh & Co., PLLP and KPMG, PLLP respectively. LPHI maintains an “arms length” policy for its investors so all policies and funds are held in trust. LPHI does not touch the investor’s money.
PERFORMANCE: Since inception Life Settlements as structured by LPHI has produced historic double digit returns. Past performance does not guarantee future results. This financial product has a battle tested track record through both bull and bear markets.
DIVERSIFICATION: Life Settlements are the ultimate diversification tool due to the fact that they are uncorrelated to the stock market, oil prices, interest rates and even terrorism. Life Settlements, as the cornerstone of any diversified portfolio, offer a hedge during economic downturns as well as during periods of market stability. Life Settlements serve as a better uncorrelated hedge than bonds and have the potential to generate double digit returns. They should be part of the FOUNDATION of every investor’s portfolio
MAINSTREAM: For many years Life Settlements were only available to institutional investors. Financial icons including Berkshire Hathaway, ABN AMRO, Credit Suisse First Boston, and Deutsche Bank, etc, have invested hundreds of millions in life settlements with the understanding that the return of their principal and return on their principal are the Contractual obligations of highly rated insurance companies. Their pursuit of this market is related to the degree of PROTECTION and the AVOIDANCE of Market and Economic Risk. These institutions involvement provide immense credibility because of the level of due diligence they require of any investment before actually committing their own dollars. Life Settlements presents the rare opportunity for an accredited investor to invest on a level playing field with major institutions.
WIN/WIN INVESTMENT: LPHI provides viable options through the secondary insurance market where none existed before. Senior citizens are released from the burden of high premiums and are provided lump sum payments. In many instances, this much needed capital infusion allows them to live out their remaining years in dignity. We allow seniors the ability to turn a death benefit into a LIFE BENEFIT.
NO MANAGEMENT FEES: All fees associated with Life Settlements are built into the acquisition costs and therefore 100% of the investor’s money goes to work for them. All your money is invested without paying any management fees or underlying fund expenses in cash or IRA investments. Qualified funds are subject of Custodial fees; typically around $100 to $200 annually.
LIQUIDITY: Life Settlements should be viewed as a medium to long term investment. They are perfect for retirement dollars, college savings funds and cash investments.
CLEAR EXIT EVENT: While at certain points in time the DOW has yielded double digit returns, even the best exit strategies are formulated on speculation and conjecture. To enjoy increasing returns, one must accept the ever increasing risk of losing principal along with profits. The investor, at his or her discretion, may exit at every policy maturity. The vast majority of investors however, elect to roll over returns into additional policies. Unlike the securities markets, decisions to exit or reinvest in Life Settlements are never predicated on speculation or mere conjecture. Life Settlements are the ultimate AUTO PILOT INVESTMENT.
Summary
It is exceptionally difficult to find an investment that meets all eight of the Characteristics of an Ideal Investment. Fractionalized Life Settlements hits a solid 7 out of 8 for most investors. For the investor with a timeline of 5 years or more, Life Settlements meets 8 out of 8 and warrants serious consideration for a portion of your investment portfolio. Call 425-829-4110 so we can help you determine what that portion might be for you.
Funding a 401(K) could be one of the biggest mistakes you could make, according to Pulzar Inc. research. The research shows:
Does your 401k plan provide protection against negative market performance?
Most Americans have lost 20-40% in their investment accounts during the past 18 months. Yes, they’ve rebounded in the past 6 months, but what built in protection is there against another downdraft and future losses?
Does your 401k plan offer strong, solid performing options? Mr Brooks Hamilton, who designs 401K plans for B&J Partners, stated on 60 Minutes that most of the funds in 401k plans are dogs.
How has your retirement account performed over the past 10 years? Are you ahead or behind where you were in 1999? If you invested $100,000 in an S&P 500 Index Fund, here’s what you’d have in January of 2009:
| 2000 | -9.10% | $90,900 |
| 2001 | -11.89% | $80,091 |
| 2002 | -22.10% | $62,391 |
| 2003 | 28.68% | $80,285 |
| 2004 | 10.88% | $89,020 |
| 2005 | 4.91% | $93,391 |
| 2006 | 15.79% | $108,138 |
| 2007 | 5.49% | $114,074 |
| 2008 | -37% | $71,867 |
| 2009 | $71,867 |
401(K) Tax Myths:
Do you know how much the tax deductions from retirement contributions you take today will cost you tomorrow?
Do you know how much you can contribute to a 401k?
Is your 401k/tax-deferred retirement plan actually setting you up to pay higher taxes in retirement, and have you out of money before you die?
Tax deferred retirement plans, including 401K plans, were set up as much to benefit the government as you. Calculations show that the average American who lives 20 years in retirement, will pay 5 to 8 times more taxes on distributions in retirement than he saved in taxes from contributions during his working years.
Do you know how’s it going to work out for you?
We live in complex times. Government spending and debt levels are the highest in history. Unfunded government entitlements are over $50Trillion. How are we going to pay for all this? What do you think? Are the low tax rates we’ve enjoyed for the past 30 years going to hold, stay about the same, or do you think tax rates will creep up in the future?
If tax rates go up, and you’ve deferred payment of your taxes to some future date when tax rates are higher, what will that do to your spendable income? If tax rates creep up in the future, then the conventional wisdom that says you’ll be in a lower tax bracket when you retire probably is no longer valid, is it?
How are you preparing for this? Do you know what results await you down the road? Are you certain you won’t outlive your money?
Most Americans have been brought up with the same basic goals-
If we all know this conventional wisdom and believe it works, then why did the Social Security Administration release these figures:
If you take any 100 people at the start of their working careers and follow them for 40 years until they reach ‘retirement age,’ here’s what you’ll find:
That’s 5% successful, 95% unsuccessful. How could good advice from widely accepted conventional wisdom produce such poor results?
If there were a better way to protect and grow your funds, when would you want to know – now, while you have time on your side, or when you’re about out of money? Small, strategic adjustments can make a significant difference. Over funding a 401(K) or tax-deferred retirement plan is not one of them.
Where you accumulate your money and how you access it in retirement is every bit as important as how much money you have.
If you’re already funding a 401K or tax-deferred retirement plan, you could already be making costly errors. Wouldn’t you want to know the impact of what you’re doing now will have on your future?
Take 17 minutes and view an important case study video about Bob and Carol. Click Here. Log in and click on ‘Bob and Carol.’ (The intro and concept videos are important, but the eye-opening numbers are in the case study.) Note the subtle, simple, cost-less changes that were recommended and the powerful impact these suggestions had on their income taxes and their retirement. Then call 206-388-4074 to run your own numbers through our proprietary process and see what the difference could be for you.
Clients who’ve implemented this very strategy have not lost a single dollar due to market performance during the last 2 years. Clients who’ve implemented this strategy over the past 10 years are over 2 ½ times ahead of where they’d be in an S&P Index fund. And they’re on their way to saving tens of thousands in income taxes. For some, it’s literally a Million Dollar difference for them and the lives of their heirs. Find out what the difference could be for you.
Call today.