Welcome back. In this episode, we're going to address the question what is better
than an IRA or 401K or a Roth IRA or 401k. I've been a financial strategist
for more than 45 years and I've never owned an IRA or 401K or a Roth. Never
will. My favorite vehicle is what some CPAs
and tax attorneys refer to as the rich man's Roth. And I snicker because you don't
have to be rich to own one. So, let me tell you the difference in this episode.
And you're going to be blown away with opportunities that maybe you didn't even
know existed before.
I've addressed many, many audiences. Probably spoken over 85,000 hours in my
life educating people both the general public and also professionals like CPAs
and tax attorneys. And when I share with them what I'm going to share with you in
this particular educational episode, they sit there they go, "Oh, My heavens. I've
been advising my clients wrong for 30-40 years." And I said, "Well maybe not wrong.
Bet you didn't know what was best." And as I explained you know, "Good, better, best.
Never let it rest until good gets better, better gets best." So, many times I'll ask
my audiences questions like, "Well, do you think future tax rates will likely be
lower?" I get nothing but crickets. Okay? Like, "What? No, no, no. I don't think so." How
many think tax rates are going to stay the same. And I get a few hands in an
audience. But when I ask "How many of you think future taxes are going to be higher?" A
sea of hands goes up. Do you think because of irresponsible government
spending and the printing of money? Hello! Taxes are going to have to be
higher in the future. So again, I ask, "Well, then why do you want to defer paying tax
on an IRA or 401k and have it accumulate into this big nest egg and then withdraw
it when we're convinced taxes are going to be higher?" So, do you know that
congress actually figured that out? There are a lot of savvy people that said, "Hmm,
yeah. That's not the smart thing to do. I would rather have my money be tax-free
when I retire. Let's just get the taxes over and done with in today's brackets
which are usually lower and put in after tax money." Well, a lot of people started
doing that. But unfortunately only about 9% of Americans understand this.
91% are still duped into putting money into yet to be taxed IRAs
of 401Ks. Defer, defer, defer. Thinking they're going to be in a lower bracket and
they're not. In 1997, the government was actually hard up for money. And even
though this may be beneficial and they didn't do it
for us. They came up with the idea of a Roth. Now, where did that name come from?
It was Senator Harry Roth. And he said, "I got an idea.
Savvy people are realizing it's better to pay tax. Put in after-tax money into
an account an IRA or 401K. And let's have it grow tax-free and then later they can
access it tax-free. Because they realize and they would rather have retirement
with no tax." And he said, "We'll, name it after me, okay?" Roth.
So, the Roth IRA was the first and then the Roth 401K. Now, the reason why I
don't care for Roth's and I've never owned one and never will because they
have too many strings attached. My favorite vehicle that I teach in our
educational seminars, webinars and all of these series here and the eleven books
that I've written is what CPAs and tax attorneys sometimes refer to as the rich
man's Roth. But you don't have to be rich to own one. I call it the laser fund. And
that's the title of my most recent book. If you click on the episode that I
recommend at the end of this, you can actually get a free copy. If you'd like,
mailed to you. But I'm going to share with you the 3 advantages that the rich
man's Roth, the laser fund has that a traditional Roth does not. First, what
advantages does a Roth have? When you put money into a Roth IRA or 401K, you're
putting in after-tax money. But it grows tax-free. And when you take it out, it's
tax-free. Now hopefully, that stays true in Australia when their equivalent of
the Roth. When the country got into trouble, they actually said, "Oh, sorry. We
were kidding." And they decided to tax people who had more than 100
thousand or whatever. They said, "Oh, you're accumulating too much money. So, we're
going to tax you now because we need the money to save this country.
Now, do you know that our government at the time under the Obama administration
was that close to doing the same thing in this country? So, that doesn't mean
that the government can't give and then take it the white. But let's assume
it stays. That's the 2 benefits of a Roth. Now, my rich man's Roth...
And by the way it's been around long before Roths have grandfathered in the
Internal Revenue Code for over 100 years that allows you to be able to
accumulate your money tax-free. And then access your money tax-free including all
the gain that you made. And when you die, it blossoms in value. It increases, it
doubles or triples many times and transfers income tax-free. Municipal
bonds don't do that. Roth's do not do that. So, let me give you
an example. In my particular Laser Fund of the Rich Man's Roth, I have 3
advantages. First of all, if I have a banner year in my business, I can
actually put in a hundred, 2 hundred or 3 hundred thousand dollars into my
laser fund. You can't do that with a Roth. You can only put in a certain dollar
amount or some percent of your income. If there's any big lump sums it has to be a
roll over from a traditional IRA or 401k triggers tax. You have to pay the tax. And
then it goes into the Roth. But other than that, you can't put in large amounts.
Not only that, in my rich man's Roth, if I need access for emergency funds, let's
say a setback or whatever, I could put in 2 or 3 hundred thousand dollars.
And I could go in and withdraw in 4 days after I deposited that money and
withdraw $250,000. And it doesn't trigger any
penalties. You can't do that in the Roth. You have to wait 5 years or till
you're 59 and a half. There's too many strings attached. So, you can't put in
large lump sums. And if you could, you can't go in and grab the money back in a
few days if you had a need. I can do that in my laser fund. But a Roth will never
do this. If I died on the freeway, let's say and I get in an accident. Every
million I have in my laser fund, the rich man's Roth with instantly at my current
age, blossomed at 2 and a half million and transfer totally income tax free to
my wife, my kids, my grandkids. Anybody I live it behind to. There's not a
Roth around that will double or triple in value like that. And people always ask
me, "Well, how does it do that? What does that cost?" I go, "Nothing.
It's being paid for with a miniscule portion of money that most Americans
an unnecessary income tax." If you want to know how and why, I am going to show you
how you can learn more and I would recommend you get a copy of my most
recent book the Laser Fund and I'll send it to you free. And I want to encourage
you to watch this episode on how to protect your money your income from
unnecessary tax. But then in that there will be an opportunity where you can go
to my website and I'll send you a copy of the book. So, you can understand all
the nitty gritty. And you can even watch an 18 hour master class where we spend
about an hour on a deep dive on every one of the concepts in that book.