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Missed Fortune – What Do Cancer & Rising Taxes Have In Common?

Posted on | June 5, 2011

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Politicians Choose Raising Taxes Over Cutting Spending

In recent editorial titled “For Democrats It’s all about tax hikes” it’s abundantly clear where politicians stand on the issue of taxes.

The picture isn’t pretty. Taxes will be going up.

Democrats have floated a plan for a tax on millionaires to force Republicans to accept other tax increases. They’ve tried to hike oil company taxes by more than $2 billion per year even though oil company profits are around 6 or 7 cents per dollar.

On issue after issue Republicans are putting forth serious, politically risky solutions while Democrats are playing class warfare and stoke public fear.

Reining in out of control government spending is only way to address the nation’s gargantuan debt.

We have increased the national debt from $9 trillion to $14.3 trillion in just the last 5 years. Raising taxes is the favored solution to many Democratic leaders.

If we took every dime about $250,000 that anyone earns in this country, it would pay for roughly 4.5 months of the president’s proposed annual budget.

As consumers we have to tighten our belts when we have to stay within our budgets. Government just wants to keep feeding its spending problem.

Taxes will be going up. Inflation is just around the corner thanks to government printing more and more money to cover their deficits. And market uncertainty and volatility has been a fact of life for nearly a decade now.

Ignoring Where Taxes Are Headed Is As Foolish As Ignoring Cancer

An article by Walter Brandimarte notes that investors have averted a broad sell-off by diving into shares of companies that are less vulnerable to the economic cycle.

These include well known defensive sectors like utilities, household products and large cap companies with steady earnings performance. With the end of the Fed’s easy money policies just around the corner, investors are becoming more sensitive to risk in general.

There are better ways to safely invest, to create greater liquidity, safety of principal and to earn a predictable rate of return that’s tax free.

We’re looking at the likelihood of higher taxes, inflation and continuing market uncertainty. It’s essential that you understand how to protect yourself against the triple whammy.

Now is the time to implement the strategies that will allow you to accumulate your money tax free now and in the future under sections of the IRS code that have been grandfathered for decades.

If we have inflation you’ll need the strategies that help rather than hinder you by linking your returns to those things that inflate.

Finally, you must protect yourself so that if the market goes down you not only don’t lose any money, but your money grows as the market grows.

Putting your head in the sand and thinking you’ll deal with taxes on your 401(k)s and IRAs down the road is highly risky. It’s like putting off dealing with a malignant tumor and hoping it won’t be so bad down the road.

Dealing with the problem today makes more sense than waiting for that tax liability to continue to grow.

It may be wise to get your money out of your 401(k)s and IRAs now and to do a strategic rollover into an environment that’s tax free from this day forward.

Indexing strategies can help you safely and predictably double your money tax free without putting it at risk in the market.

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*Life insurance policies are not investments and, accordingly, should not be purchased as an investment

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