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Missed Fortune – Future Taxes Can Eat Your Retirement Funds

Posted on | December 26, 2010

Protect Yourself From Taxes and Inflation

The economy is like a sinking ship and Congress is rearranging the deck chairs.

Our National Debt has jumped to $14 trillion. It doesn’t matter if we postpone higher tax rates for a couple of years. Sooner or later, taxes will be going up and dollars will be worth less.

Taxes and inflation can significantly lower your purchasing power. You need to protect yourself.

You need an investment strategy that is tax-free, not tax-deferred.

A dollar doubling every period for 20 periods grows to over $1 million tax-free; it only reaches around $27,000 if it’s tax-deferred.

Most people don’t realize this. They sock away money in traditional accounts that can be taxed on the back end.

People withdraw money thinking they’ll be in a lower tax bracket when they retire, but they’re in a bracket as high or higher than they were because they lost their deductions.

You need to set aside your money in vehicles that are safe, liquid and produce a rate of return greater than inflation. You can conservatively earn 8 to 10 percent in a tax-free environment.

I’m not talking about IRAs, 401(k)s or 457s. I’m talking about tax codes 72e and 7702.

If you average 7.2 percent growth a year, your money will double in 10 years. For every million dollars you accumulate, you can take out $72,000 a year without touching your principle.

Your future could be a whole lot more secure.

Start Saving Smarter

Folks who follow the Missed Fortune strategies have taken advantage of indexing. If inflation occurs, their money is linked to the things that are inflating.

They didn’t lose a penny in 2008, when most Americans lost 30 to 40 percent in the value of their retirement accounts.

I can teach you that IRAs and 401(k)s are not the best ways to safe for retirement. I can teach you that sending extra payments to the mortgage company is not the best way to get out of debt.

In my book Baby Boomer Blunders, I explain how to avoid the financial mistakes that 95 percent of Americans make.

Now is the time to start converting those retirement plans into safer, smarter investments.

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

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