Crystal Ball Retirement

If you had a crystal ball that could predict the exact moment your IRA or 401K would experience its greatest loss, would that information be valuable to you?

What if you realized that in that single moment your account would lose a larger percentage of its value than any other day or time that you had ever experienced in your investment history? A larger percent loss than Black Monday October 1987; more devastating than during the early 2000’s Tech Bubble Burst; or even more crushing than the 2008 Financial Crisis.

Well, you don’t need a crystal ball because I can unveil that moment to you right now. You see, the greatest loss you will ever realize in an IRA, 401k, or any qualified retirement plan is the day you begin taking income distributions. Does that surprise you?

The truth is: Deferring taxes is simply Tax Procrastination, and qualified plans are a time bomb with a lit fuse, which will one day explode and create a tax disaster. You may repay all the taxes you thought you saved over the last 30 years during the first three years of income distributions.

So why do so many of us fall into this “follow the crowd” mentality and continue to sock away our hard-earned life savings into these types of qualified plans? It’s simple; we don’t know what we don’t know. Perhaps our advisors are telling us this is the best way to save. Possibly our employers are encouraging us to contribute to a 401k plan based on a “painless” payroll deduction. Maybe that’s the way you’ve always done things, and are convinced that all will miraculously work out.

If you’re feeling confused, isolated, and even a bit powerless right now, don't. You’ve faithfully followed the best plan you knew to be available to you and you should be commended for that!

It’s great news that you’ve taken responsibility for your future. Now get excited, because there is more great news... and it’s known as RAFT, and it’s a new plan to retire with dignity ­­ tax-free dignity. RAFT is an acronym for Retirement Approach Free of Tax. If you're thinking RAFT must be a Roth IRA, you are headed down the track toward the right destination, but you took the wrong train. Roth IRAs are better than traditional IRAs, yet come with many strings attached including strict limits on contributions and requirements for liquidity.

RAFT, a properly designed and properly funded equity-indexed contract with a life insurance company, provides the three ingredients to a prudent investment.

1)        Liquidity

2)        Safety

3)        A Great Rate of Return

No longer do you have to be 59 ½ years old to access your money without an IRS penalty. With RAFT, you can access your principle and your gains tax free whenever you want using interest-free policy loans that are not required to be paid back during your lifetime.

Safety doesn’t mean diversification; you found that out in 2008. Safety means you will never have a negative return during a correction or crash in the market, yet your gains are locked in every year when the market index is positive.

A good average rate of return in most volatile investment choices would be 7% or 8% per year. RAFT has provided an average rate of return of 7 to 8% tax-free. The index crediting lock-in and reset method eliminates the possibility of potential losses due to a volatile stock market. Now that’s not good ­­ it’s great!

These policies can be designed to accommodate a myriad of circumstances. Perhaps you’re just getting started (or restarted) and the most practical way for you to begin is by depositing minimum monthly premiums. Perhaps you have savings in a low-interest bearing account, or your nest egg is currently in harm’s way and you’d like to fund the strategy as fast as possible. You can fund your policy in as few as four years. You see, in addition to liquidity, safety and a great rate of return, RAFT is flexible, and so much more ... and it’s all tax-free!

Crystal ball not included.