Do you want to be Mr. taxed to the max or Mrs. I've a lot more. In this episode, I'm going to
address the question. How can I get money out of my IRA's and 401ks with the least amount
of tax? Get ready, a lot of financial advisors even tax advisors like CPAs and tax attorneys
come to attend my advanced continuing education to learn these very strategies.
So, my name's Doug Andrew and I've been helping people optimize their financial assets and
minimize taxes now for north of 48 years. I've been primarily viewed as a retirement planning
specialist. In that 48 years, I've helped many many people convert their IRAs and 401ks to
better plans. Do what I call a strategic roll out not a rollover as you're going to learn here. So,
there's a lot of reasons for this and I've been very blessed in my life to have
12 best-selling books and I've also written many many articles and I remember one day when I was
in the radio studio. Because I've had a radio show now for 13 consecutive years and I got this idea
just 60 seconds before I went on the air and I said, "You know what, I'm going to talk about Mr.
tax to the max versus Mrs. I've a lot more." We had a wonderful sort of foster daughter
whose last name was Mori and so that's where I got the name Mrs. Ive a lot more. Now,
the difference between these two people is Mr. tax to the max follows the herd
and keeps his money in traditional IRAs or 401ks even after age 59 and a half. He follows the herd
and he doesn't need the money and so he gets duped like many Americans do into continuing to defer
postpone procrastinate, paying tax on those IRAs or 401ks because he doesn't need the money
yet he's still working and so many people go, "Well, why should I tap into it if I haven't retired yet?",
and they get duped into continuing to defer until they're like 70 and a half used to be the age
now it's age 72. Because what happens at age 72? If you don't start to withdraw money based upon the
government's minimum distribution or life expectancy formula the penalty is 50 percent
on top of the tax. This means that let's say at age 72, if you got a million dollars and IRAs & 401ks
and you've been deferring and you think you're saving tax. Now, if you do not withdraw
let's say your life expectancy is 20 years. At age 72 if you do not withdraw 120th that year
50,000 the penalty is $25,000 on top of the tax on the full 50. Yeah, the government is dead serious.
They are counting on that tax revenue. So, those are called RMDs or required minimum distributions and
so you hear advice on CNBC and what have you. Well, if you don't need the money take out your RMDs.
Now, to be honest, I think that's about the worst advice I've ever heard for most
Americans RMDs required minimum. You're going to understand why here because you're not saving
tax. Tou are compounding increasing the tax and delaying the inevitable. I developed software
years ago that showed people the darkness of the night so to speak. If they deferred until
they were aged 70 and a half or now age 72 and then took RMDs the rest of their lifetime
and their spouse's lifetime and then they died and left behind the IRAs of 401ks to their kids. Which
savvy CPAs and tax attorneys will say, "That's the worst place to leave money when you die",
you and your spouses to your kids and IRAs & 401ks. Hopefully, you'll understand as we proceed here but
that's what most Americans end up doing. They're shocked when I would show them the amount of tax
they would pay by stringing it out versus if they did a strategic rollout. Especially the
sooner the better at age 60 to 65, age 65 to 70. Sometimes people don't come to us until they're 70
and they say, "Should I take RMDs?", and i go, "No, don't take the required minimum
take the maximum." Strategically, we can get out of there without sending your tax bracket through the
roof. Why? because your current tax bracket is likely the lowest bracket you will ever be in
and the American dollar will never be worth more than it is today because of inflation. Hello?
And so, I would show them a strategic rollout illustration. So, I'm going to go over to the
screen and show you what I'm talking about here and what you can do to possibly consider getting
money out of your IRAs of 401k strategically to dramatically reduce the amount of tax you will
pay and possibly double or even quadruple your net spendable income. We have done these hundreds if not
thousands of times for people on their IRAs and 401ks. So, in the article, I wrote Mr. tax to the max
he keeps his money in his IRAs 401ks at age 60. He's over age and a half so he could
have accessed that money in five years and got the taxes over with. Instead, he deferred for
another 10 years and his half a million doubled to a million at 7.2 percent. I use apples to
apple's interest rates and now he has a million and I prove by taking out 7.2%
72,000 a year and he has to pay tax the rest of his life and his spouse's life the pathetic amount
that generates after-tax. Then I compare him to Mrs. I've a lot more. She strategically gets the money out
of her IRA's of 401ks at the same age, age 60 over a five-year period and only pays 150,000 in tax. You
know how much tax Mr. tax to the max ended up paying by the end of his life expectancy and his
spouses? Nearly 900 grand in taxes. Mrs. I've had a lot more only pays 150,000 in tax over five years takes the
net after-tax repositions it into a portfolio of laser funds my favorite vehicle. That allows you
to accumulate your money tax-free, access your money tax-free. When you die it blossoms and
and transfers tax-free reimbursing you many times the tax you paid during
the rollout. At the end of the day, it doesn't cost you anything it makes you money and Mrs. I've
had a lot more ends up with double the net spendable income. She has nearly 90,000 tax on the max only
has about 43-44,000. We do this all the time. She has double the income and when she dies she leaves
behind twice as much. Let me just summarize. Why would you generate x amount of income out of your
IRAs or 401ks after tax when you could have 2x double that the rest of your life and why at the
end of the day when you die. Why would you leave behind x amount of money in your IRAs of 401ks
when you could leave behind double that or triple that if it doesn't cost you anything and people go,
"Really, how do you do that?", it is done with a strategic rollout. So, there's a lot of articles
through the years like this time magazine article in 2008. That said, why it's time to retire the
401k and do something better instead? In fact, in 2017, the wall street journal came out with one
that said the original champions of the 401k lament the day they ever came up with that idea.
It's because it was never meant to be the primary retirement savings vehicle it's subject to tax
on the back end and taxes are not going down. Inflation usually erodes away the
purchasing power of those dollars and so you have to keep taking out more and more money to keep up
with the cost of living and because of the four percent rule in the financial services industry it
you're it's not going to cut it. On every million, you can't get by on 40,000 a year also because of
the market volatility and that's what this article was about. Because for the second time in a decade
in 2008 when this article came out people had lost 40 percent of the value of their IRAs or 401ks
and it took four years until 2012 to make back what they lost. From 2000 to 2012 instead of just
breaking even our clients doubled and tripled their money using my favorite vehicle the laser
fund. Now, before I go into the next concept let me just encourage you to subscribe to this channel. If
this is resonating and you can think of somebody that ought to watch this. Share, post a comment,
click like, but subscribe to the channel it's free three-dimensional wealth. But click on the little
bell so you'll be notified every time I post a new financial episode which I do almost on a daily
basis. It's free and stay with me to the end of this episode because I want to gift you a copy of
this 300-page book the laser fund that will teach you how to diversify and create the foundation
for a tax-free retirement. Now, in the book you'll learn that ever since 1986 tax reform there's only
three types of income Americans pay income tax on. Earned income which would be salaries and wages.
Passive income which would be rents and leases and portfolio income which would be interest or
dividends. Money inside the laser fund is tax free. Now there's a lot of reasons why it's a
sacred tax-free cash cow because you're taking pressure off of the government to have to
provide for widows orphans people in retirement who are trying to be self-reliant. But frankly, if
you have a million dollars in a laser fund I can show you how that can generate 80,000
to a hundred thousand of tax-free income even if you live to be a hundred and twenty years old.
A hundred thousand a year tax-free income. People say, "Why is it tax-free?", it's cut and dried because
it's not deemed earned passive or portfolio income. There's nowhere on a 1040 tax return to put it.
Our clients who receive it the IRS knows they're getting it. They know everything. But they know it's
tax-free because it's not one of these three types of income. So, I'll show you what this really means
at the end of the day. Because if you put money in a tax-deferred IRA or 401k you're continuing to
have a permanent tax lien by Uncle Sam. Uncle Sam will always get one-third of whatever that grows
to, that is the tax impact. See, deferred taxes mean increased taxes. So, I would rather have
an account that accumulates tax-free like the laser fund and I can access the money tax-free.
It is dynamic this is way better than a Roth and you can learn why when you study the book.
So, in the book, we talk about four different retirement and accumulation buckets that
most Americans save money in not all four for everybody but too many people are way too
top-heavy in this purple bucket yet to be taxed IRA's & 401ks invested in the market and I go what
are you thinking? I would recommend no more than 30 percent of your money be in that bucket when
you retire. That means we have to do a rollout. Some people have real estate and sometimes they're sick
and tired of taking out the trash and evicting tenants and fixing toilets and so they
they're afraid to sell because they're going to have to pay a capital gain it looks like a
lot of these politicians are going to do away with some of the benefits of that real estate.
People are shocked when I show them selling the real estate paying the capital gain and putting
it down here into my favorite vehicle which is the tax-free bucket. Some people get a
pension social security or pensions like a school teacher or police officer firefighter. That would
be guaranteed income but I'd recommend no more than 30 percent of your income come from these two
depending upon your risk tolerance between zero maybe up to 80 percent of your income could
be a guaranteed income. But this is my favorite the tax-free bucket. I would recommend between 40 to 60
percent of your income be totally tax-free. The IRS knows you're receiving it but there's nowhere on a
1040 tax return to put it. What does this mean? It means that most people are going to have to do a
strategic rollout, not a rollover. That's going from the frying pan into the fire like taking money out
of 401ks into IRAs and continuing to defer. No... you roll the money out of here down to here.
You get the taxes over and done with sooner than later. Now, I've never owned a Roth never will
because the laser fund has six benefits Roth only have two you'll learn in the book. Municipal bonds
are not very safe anymore so many municipalities are filing bankruptcy and they're low-yielding. My
favorite is the laser fund by far. You'll learn why in the book called the laser fund. So, here's the
essence of what my message is. I've had many people come to me and they'll say, "You know Doug, we have
about 40,000 of income coming from social security or our teacher pension and another 160,000
from this two or three million we've saved in IRAs and 401ks and the like. We have 200,000 of income."
I go, "Well, that's great. Way to go but there's one problem. It's all showing up on the front page of
your 1040 tax return", and they go, "You mean there's a better way?", and I go "Yeah", see, you're paying about
54,000 in tax and that's going to keep going up you're only netting 146,000 to buy gas and
groceries prescriptions and golf green fees. So, in five years we do a strategic rollout which means
we get 120,000 of the 200,000 off of their 1040 tax return every year.
They have the same 200,000 of income but now 120,000
is not deemed earned passive or portfolio income. They're only paying
21,000in tax they're netting 178,000. What did we save them?
32,400 a year in tax out to life expectancy for a husband and wife, we save many people
800,000 to a million dollars on the unnecessary tax doing one strategy a strategic rollout. I would
recommend you check this out. So, how do you do that? I want to gift you a copy of my most recent
best-selling book it's the laser fund. Here's how you can claim your free copy of this book.
Go to laserfund.com click on the link below and you contribute a nominal amount towards
the shipping and handling. I'll cover the rest of that cost and I'll pay for the book and fire it
out to you it's 300 pages. It's actually two books in one. One is 200 pages 14 chapters
the white covered side with all the charts and graphs.Iif you're a right-brain learner you flip
it over. You read this one this is a hundred pages 12 chapters with 62 actual client stories of how
the laser fund is a dream solution one chapter here talks about strategic rollouts and has
five stories in it. So, claim your free copy of the laser fund book there's also options there
to listen and learn watch and learn. You can even invest in an 18-hour master class if you
would like to empower yourself to diversify and create the foundation for a tax-free retirement.