Plenty of time to have an extra million dollars. In this episode, I'm going to
address the question "Is 50 too late to save for retirement?" The short answer is
absolutely not. But it's critical what you do with the
remaining 15 or 20 years you have before you retire. Put on your seat belt you're
going to see some opportunities you never knew existed before.
Hi, I'm Doug Andrew. I've been a financial strategist, a retirement planning
specialist for more than 46 years. And so, I wish I had a nickel for every time a
couple, an individual has said, "Oh, I'm 50 years old now. It's too late for me, right?"
I go, "Wrong, no. I wish I could have caught you in
your 30s or even 20s. I could have prevented maybe some of the mistakes
you've made. But frankly, I like working with people like you because I get to
cure a disease, not prevent it. I would rather have prevented it. But it's never
too late." So, a 50-year old... Heavens! When do you plan on retiring? Now, I have a
confession to make. I've never liked the word retire. I'm a retirement planning
specialist. Why is that? Because retire means put out of use. See, it came out in
the Industrial Revolution when they had factories and they decided to retire
worn-out equipment. They retire equipment. Brought in new. Then they
decided to put out of use old worn-out people. When they put people out of use,
do you know the life expectancy when people were put out of use was only
7 years. And that's why Social Security that started at that time was
only ever designed to have to pay out benefits an average of 7 years.
That's why the system is actually broken because now a baby boomer couple, one of
you will make it to age 96. That's why the government is sort of in debt. They
owe over 130 trillion dollars in future Social Security and Medicare benefits to
the people they withheld it from because it was originally designed to only have
to pay out an average of 7 years. Now, people are living longer than running up
health care costs. And frankly it's a train wreck waiting to happen but let's
get back to... I don't want to be put out of use.
Do you? So, I've helped many many people for years redefine themselves in
retirement. Do the things they love to do and
worried about their money, not outlive it. When we prepare for retirement and we
only have a window of time, let's say from age 50 to age 65 or age 70, most
people even Social Security now the optimal benefits are after age 66 or 67.
And they say, "Oh, if you'll wait till you're 70, you get this much more" and
what-have-you. Because they're trying to encourage people as we live longer (life
expectancy is longer now) that people put off. Why? Because when you stay in motion
adding value that increases your life expectancy. If you retire and put
yourself out of use and you become a couch potato, your health goes down, your
vitality goes down, your money goes down. You stop doing what created the growth
and excitement. And pretty soon people get into this survival mindset. So, you
have people striving early in life and then they start to arrive at financial
independence or at least having money that they can sock away. They live on
less than what they earn. And then the secret to thrivers is they repeat the
process. That's what I love doing is helping people like you thrive. All too
often, when they start to approach retirement, they hunker down into this
survivor mode. And then pretty soon their wealth dives and their health dives so
it's like this bell curve. You have strivers, arrivers, thriver, survivors and
divers. See, I want you to constantly thrive. One of the keys is to stay in
motion, have vitality and zest for living and not worry about the money. Financial
independence gives you freedom. And with freedom, you don't have to worry about
outliving your money. So, the key is not so much what you begin with it counts.
It's what you do with your current assets. Most people that are 50 years old
have assets that they can reposition in order to optimize those assets and end
up with an extra million bucks, an extra 2 million dollars. In 20 years, an extra
million dollars in 10 years. I've done this over and over and over
again. Now, there are some who they lost everything. Their business had to go
bankrupt or something happen. And I've actually created millionaires in less
than 10 years starting with nothing at age 50. You know, they would read my book
that I co-authored with my 2 sons? It's called Millionaire By 30. And they go,
"Well... Well, I'm Way over 30. I'm 50." I'm going, "Principles are the same. This
book is written to an audience that starts with nothing, from scratch." And in
10 years allows you to have an extra million
bucks that can generate $100,000 a year of tax-free
income for as long as you live. So, no. 50 is not too late. It all
depends on when do you want to retire. Age 60, age 65, 70? If you keep in motion and
you don't need the retirement dollars because you're earning money by
redefining yourself, you have 20 years that you could accumulate an extra
couple of million dollars. That's plenty of time. Now, if I would have caught you
20 years earlier than that, you would have 8 million. not 2 million. But
we have to work with what we have. So, here's a few ideas to help you
understand what I'm talking about. So, whenever I have a couple or an
individual that's at age 50 or so and they say, "Is it too late for me?" What I do
is I sit down and do an analysis of their assets. And which assets they have,
maybe real estate, maybe the equity in real estate, maybe rental property, money
in IRAs and 401Ks that's underperforming. It's yet-to-be-taxed and it's going to be
taxed like crazy when they take it out. And I look at those assets. Maybe they
have money in a bank or credit union. Maybe they have an impending inheritance.
Maybe they will sell their business. I look at all possibilities of assets that
are being underutilized. And then I would go through an analysis to reposition
assets over the next 5 years to where we increase the liquidity of that money.
Because many times their money was trapped in the piece of property. The
only way they could get it was to sell it or to refinance
or something. Or it was trapped in their IRAs and 401Ks thinking, "Well, I can't
touch that until I'm 59 ½." Well, actually there's a few strategies where
I've helped people get money out of their IRAs or 401Ks without a 10%
penalty before age 59 ½. Maybe we wait till 59 ½. But we do
strategic rollouts. Getting the money out of those IRAs or 401Ks in the market
get rid of the volatility and convert it to tax-free. We look at all of their
assets. I've taken many people's real estate portfolios and totally transform
them to increase the rental income by double, triple and quadruple or maybe
just sell them. Quit being a landlord. It looks like you're not enjoying it. "You
like taking out the trash, fixing toilets and evicting tenants? Do you want to do
that the rest of your life?" "Well, no. But I don't want to pay the capital gain." What
if we did? We can do 1031 exchanges and we can hire a property manager. And I've
done this many times and quadrupled their cashflow. But sometimes people say,
"No, I don't even want to deal with this in retirement."
Well, let's pay the capital gain offset that tax by doing this. And let's
reposition it and they're flabbergasted when the money that was in their real
estate properties now is earning about 10% annual rate of return. Meaning
every million can generate 100,000 a year of tax-free income.
Whereas their rental properties really generating 30,000 a year of income. They
go, "How can you do this?" It's because I'm an asset optimization specialist. I look
people's assets and I see potential they don't see. One of my favorite people
that won the Nobel Prize twice in his lifetime is Albert Szent-Gyorgyi and he
said, "Discovery consists of seeing what everybody has seen but what nobody else
has thought." See, I love that. Because my challenge is to always look at what
people have and what they see. But helping them see something they've never
thought of before with existing assets. So, by doing that, I reposition those
kinds of non-performing assets. And I make sure wherever we're going to
reposition that money strategically, we increase the liquidity, the safety and
the rate of return. And we make sure it's tax-free from now on. Not just tax
deferred. So, let me give you an example of this and connect the dots.
The critical part here is to meet with a professional who understands how to
reposition assets and look at those that are non performing. Be it yet-to-be-taxed
money in IRAs and 401Ks in a volatile market and get rid of that volatility.
Get the taxes over and done with sooner than later and reposition that money
into something that's going to be tax-free from now on. Look at money
sitting in a bank or credit union earning a measly 1%. And move that up to
where your bank is putting that money. Most banks will put 30 to 40 percent of
their tier 1 assets into triple-A rated insurance companies. Why not bypass the
middleman? Why do you have your money in a bank where the bank takes your money
and puts it into an insurance company increases the safety by 6 notches higher
and earns 5 times the rate of return? Instead of 1%, they earn 5%. You can do
that. But you don't have to settle for 5. I've been earning a net of
10.07% tax-free on my index universal life insurance policies. You're
wanting to increase liquidity, safety and the rate of return. You do that by
analyzing where do you have your money now, which ones do you want to reposition
at what time frames so that you don't trigger unnecessary tax or do something
stupid or or trigger a penalty that you can't make up the difference or the
penalty with. The objective is to move it over here so that by the time you're 65
or 70, you go, "Oh, My heavens. I was heading if I was lucky to $1,000,000 nest egg by
doing this this and this. I have now 2.5 million." Wow! 2.5
million can generate 250,000 a year of tax
free income. Your million and the market based on the financial services industry
standards, 4% rule would have only generated 40,000 a year of income and it
would still be subject to tax. We do this all the time. We double, triple sometimes
quadruple or more people's net spendable income by taking them as late as age 50,
age 60, repositioning assets to optimize them
and minimize the tax and increase what we call that laser test. So, let me make
sure you understand what laser stands for. Laser is an acronym that I've used
for years that stands for liquid assets safely earning returns. And I love it so
much that I have a laser test in my most
recent book The Laser Fund which I affectionately call a max-funded, tax-
advantage index universal life insurance policy. It passes the liquidity, safety
and rate of return test and it's tax-free with flying colors. And so, it's
called The Laser Fund. If you want to learn more about this, I want to gift you
a copy of this 300-paged book for free. I'll tell you how you can claim your
free copy. You go to LaserFund.com. L-A -S-E-R, fund, ".calm" and you can claim your free
copy by paying $5.95 shipping and handling. I'll pay for the book, you
pay for the shipping. You'll also have the option if you like to listen and
learn or watch and learn for audio and video formats to also empower yourself
on how to optimize your assets because it's never too late to be able to
accumulate an extra million, maybe 2 million dollars for your retirement.