Retirement contributions with no strings attached. In this episode, I'm
going to answer the question "What is the best way to
make retirement savings contributions?" You know, I've been asked this question
thousands of times. The answer is not what you think.
So, my name is Doug Andrew and I've helped people
for more than 4 and a half decades optimize their financial assets and
minimize taxes and empower themselves to retire not
outlive their money by dramatically increasing their rate of return safely.
In fact, increasing the safety of their money
and earning predictable payouts of 8 to 10 percent. Every million dollars they
accumulate can generate 80,000 maybe a
100,000 a year of tax free income
for as long as they live. Whereas most people
who have IRAs and 401Ks only get four percent as a payout. 40,000 on a
million. And that's before tax. They have to pay
tax on that so they're only netting maybe 25 or 30 thousand to buy gas and
groceries. So, this is not a little bit better that
i'm going to share with you. This is 100% sometimes
300% more because many people, they pull out
90 grand a year versus the 30,000 net after tax out of
an IRA, 401K portfolio invested in the market. So, I'm
going to share with you what are the differences I'm going to
use some metaphors and examples to teach you this concept that will
empower you. So, let me start out with a metaphor here,
the farmer and the seed. If you were a farmer and you had the
choice of buying your seed in the springtime, you didn't have to pay
tax on what you paid for the seed. So, you buy the seed, you don't have to pay tax
then you plant it, you cultivate it, you irrigate it. You work really hard
and later on in the fall you're going to harvest your crops.
Now, you agree to pay tax on what you sell your harvest
for. I just described a traditional IRA, 401K to you. You get a tax break on the
seed money, the contributions. You don't have to pay
tax as you're growing your money. But then when you harvest your money in
retirement, now you agree to pay tax. Now, the old premise on IRAs and 401Ks
was that, "Oh, you should do that because you will
be in a lower bracket when you retire." Well, that has not been true or axiomatic
for more than 25 years. People who say very
much are not in lower brackets. They're in as
high or higher brackets as they've ever been in. So that's not the right
advice. Even congress realized this in 1997 when they
were hard up for money. And senator Roth said, "Hey, we'll name
this after me." And so they came up with the Roth-Ira
401K and they said, "Hey, you know what? People are getting smart.
They're not in lower brackets if they say very much."
So, let's have them pay tax on the seed and enjoy the harvest without
tax. Now, that's a step in the right direction but
folks, I've never owned an IRA, 401K. I never will.
I've never owned a Roth Ira, 401K. I never will. And I'm going to explain to you why
because Roths only have 2 benefits. My favorite vehicle is called the Laser
Fund. It has those 2 benefits that Roths have.
But 4 additional benefits that Roths will never
have. And it's been around in the internal revenue code
for over a century. It's a sacred cow. I can pay tax on the seed money and
enjoy the harvest without tax. But I can earn rates of
return that are far greater and safer than where most people have their money
in Ira 401Ks or even in Roths. So, are you ready?
Now, you can type in some questions below or search my other educational videos on
this channel. I want to encourage you to subscribe. But
listen to the 6 benefits of what I call my
Laser Fund. And then I'll show you how you can learn
more about the laser fund and if it might be right
for you for your serious cash for goals such as retirement.
You fund a Roth Ira/401K with after tax money. When congress came
out with this idea in 1997, it was really for them, not for you.
I'm not saying it wasn't maybe a step in the right direction. But
it triggered tax when people rolled money over
from a traditional Ira/401k over to a Roth,
that triggered tax. You paid tax. But then you got to enjoy
the money later on tax free. And if you're
going to be in a higher bracket when you retire or you think congress
is going to slowly raise taxes, I can prove to you mathematically,
and I do it in my books that a Roth IRA/401K will generally produce 33%
more net spendable income. It will last longer
than the exact same amount of money at the same rate of return in a traditional
Ira/401K. Have I got your attention? So, what are
the two benefits of a Roth? You fund it with after tax money. It
accumulates tax-free and you can access your money tax free.
The laser fund has had that benefit grandfathered in the internal
revenue code since 1913. Even before the coat.
But for over a century, it's a sacred cow. It's the only
vehicle in the internal revenue code that allows you to accumulate your money
tax-free and then be able to access that money
tax-free. But when you ultimately die, it blossoms and transfers tax-free. So,
let me explain this. See, in my laser fund... And what is a LASER
fund? Laser is an acronym that stands for liquid assets safely
earning returns. It is a max-funded, tax-advantage
insurance contract but not just any contract.
It is designed where you put in the most money the IRS allows.
You take the least amount of insurance the IRS will let you get away with. And
you put in the most money the IRS allows as fast as they allow and
it turns into a cash cow. This is where I have averaged between
7 to 10 percent rates of return for 40
years when the idea was first introduced by EF
Hutton. And they weren't even an insurance company, okay? Now, here's how it
works: I can accumulate my money tax free, I can
access it tax-free just like Roths. What are the 4 additional benefits?
See, with the laser fund, sometimes it's referred to as the Rich
Man's Roth by savvy CPAs and tax attorneys.
I always snicker because you don't have to be rich to have one. I mean,
you can set up a laser und for 500 bucks a month. But see, people who make
too much money can't own a Roth. So, with a laser fund, if I have a banner
year, I could design it to hold 300,000 a year.
You can't put that much into a Roth. That's why it's called the Rich Man's
Roth. If you have a lot of money, you can put it in the laser fund. Now, you
can put in 300,000. You don't have to. You put in 30,000.
Well, if you could have put in 300, you only put in 30.
There's 270,000 of room you didn't use. With a Roth, if you don't use the
allocated room which is small in a given year,
you've lost it. You can't ever make up for years you didn't maximum fund it.
With the laser fund, I can put in the other 270,000
anywhere in the future I want on top of that year's 300,000.
So, you can make up for years that you didn't put in the maximum.
You can't do that with the Roth. Now, let's say I put in 30,000
and I could have put in 300. I can make it up. But if i put in
300,000 and 30 days later, I need 250,000 of that back for some
emergency or some investment opportunity to buy a piece of property.
I can do that with an electronic funds transfer or a phone call.
If you put money into a Roth, you can't touch it for five years until you're 59
and a half or whatever. And so, I like the laser fund because I
can put in more money. And I can take it right back out again.
There's no IRS penalties of 10 or whatever for touching the money.
So, it's very flexible. Way more flexible than a Roth. Here is
the fifth benefit. Using indexing, my money can participate
when the market goes up without my money be invested or at
risk in the market. And if the market nose
dives, I don't lose. This is called indexing. Most
financial advisors think I'm talking about index mutual funds. No, no.
Indexing is a strategy where your money is
safe and it's earning a general account portfolio rate but if you want to link
it to whatever the market or the economy is doing, you
can do that. And your money is not invested in the
market. The financial institution, in this case an
insurance company is taking the interest on your money and
buying upside options so if the market goes up, you can earn 10%.
I've earned 15, I've earned 25 some years like 2017. But if I guess
wrong, the options expire worthless but I did
not lose my principle. If I started the year with a million and
the market tanked 40%, I don't lose a dime. I still have my
million. I may not have made very much but I didn't lose. That's called indexing.
I want you to learn about that. The sixth advantage to the laser fund
is when I die... Because none of us are getting out of here alive, i mean out of
this life. If i die right now, I'm 68. If i die
right now, every million dollars I have... Let's say in a
laser fund portfolio would blossom right now to about 2.5 million
and transfer income tax free to my wife,
my kids, my church, my charity. Anybody I want to leave it to.
There's not a Roth around that will do that.
And people say, "How much does that cost?" Well, nothing's free.
But the way I design it, the way I teach it in my book,
it's paid for it with a minuscule portion of interest.
That would otherwise go out the window in unnecessary income tax. If i had my
money where most Americans have their money in
inferior Iras and 401Ks. So, why would I do that? I'll take as much
coverage as I can get when I die. If it doesn't cost me anything, it's being
paid for by Uncle Sam with redirected otherwise payable tax. Now if
this is intriguing questions, okay? If this is helping
you to become curious, let me show you how you can learn more about this
laser fund. So, if you want to see if a Rich Man's Roth a laser fund
may be appropriate for you, learn about it.
This is my most recent best-selling book book number 11. It's 300 pages
containing charts graphs and explanations.
You flip the book over and there's another 12 chapters with 62 actual
client stories. And so, this book retails for 20 bucks.
I'll tell you what. I'll pay for the book. I'll gift it to you for free. You simply
go to laserfund, (L-A-S-E-R) laserfund.com to claim
your free copy. You simply pay $5.95 towards the shipping and handling. I'll
cover the rest of that and I'll pay for the book.
There's also other options in there if you like to listen and learn and watch
and learn. And you will understand how to
diversify and create the foundation for a tax
free retirement that'll knock the socks off of any
Roth you can show me.