10 Ways to Avoid Outliving Your Retirement Income

relax on the beachOne of the biggest fears that Americans, and especially baby boomers, have is running out of money before they die. The last thing we want is to become a financial burden on children and other loved ones.

No one can guarantee that we won’t run out of money. But there are steps we can take now – regardless of age – to ease our fears, reduce our dependency on volatile markets, and pursue a wealth-building strategy that runs counter to what mainstream society is telling us to do.

Here are the top 10 ways to avoid outliving your retirement income:

  1. Start planning as early as possible: It’s never too early to start planning for retirement. And planning does not mean simply putting money into a retirement account every month. Rather, you need to start building a long-term retirement strategy to ensure you get to where you want to be by the time you retire.
  2. Reduce your spending now: No matter how much money you’re earning now, and no matter how comfortable you feel spending money now, the day will come when you’re no longer earning money and you need to ensure it lasts the rest of your life. It’s important to reevaluate your expenditures and reduce spending that jeopardizes with your long-term financial security
  3. Account for factors outside your control: One common pitfall when saving for retirement is not accounting for factors outside of your control – namely, soaring healthcare costs and other types of inflation, plus an inability to know over how many years your retirement savings will need to stretch. You must factor in these considerations when planning for retirement.
  4. Assume unexpected expenditures: If we knew exactly how much we needed for every year of our retirement, we could plan accurately. Unfortunately, life happens, and we must be prepared to foot the bill. Especially as we age, we can expect to be hit with all sorts of costly medical expenses, as well as any number of natural disasters and other emergencies.
  5. Develop a true wealth-management strategy: Most Americans focus on a magic number for retirement – say, a $1 million savings goal. But that’s a mistake. With so many factors outside your financial control, you need a true wealth-management strategy that provides security from market forces, liquidity so you can access your investment when you need it most, and a hedge against inflation forces that can obliterate your spending power.
  6. Don’t put all of your eggs into Wall Street’s basket: IRAs, Roth IRAs, and 401(k)s have become such ubiquitous retirement investment products that most people think they’re the only option for saving for retirement. What they all have in common, though, is that they rely heavily on putting your hard-earned income into Wall Street’s hands. News flash: Wall Street is not looking out for you as an individual investor. Rather, Wall Street is focused on growing the market as a whole, which may put your investments into financial peril.
  7. Take out a whole life insurance policy: The foundation of a comprehensive wealth management strategy is whole life insurance. Whole life insurance is insulated from the volatility of financial markets, and it’s a secure investment because the industry is so tightly regulated. Properly structured Whole life insurance policies also have guaranteed dividend payments that provide a steady return on investment.
  8. Access the cash value of your policy: When structured correctly, the full cash value of whole life insurance becomes a liquid asset that you can access to fund other investments. In the process, you become your own bank, borrowing against your own investments without incurring any tax liabilities – and also retaining the full cash value.
  9. Invest in real estate: With the cash value of your whole life insurance policy, you can invest in real estate. Over time, you can build equity as property values appreciate. Furthermore, you can collect rental income on these properties while you wait for the optimal time to sell.
  10. Consider commodities and collectibles: Commodities range from precious metals like gold and silver to agricultural products, oil and building materials. Collectibles range from fine art to fine wine to rare coins. When you learn how these investments work and start to have fun with them, they can be a welcome alternative to the uncertainty of Wall Street financial markets.

There are so many steps you can take to avoid outliving your retirement income. You should seek to optimize your retirement savings now by advanced planning, reducing spending, considering factors outside your control, and planning for the unexpected. Next, you should develop a comprehensive wealth-management strategy that lessens your reliance on Wall Street and includes taking out a whole life insurance policy. The cash value of that policy can then be accessed to invest in real estate, commodities, collectibles and other investments that further diversify and reduce your risk.

Want to learn more about what it takes to retire successfully? Check out Preparing for Your Complete Retirement Journey

Stop Lining the Government’s Pockets with Your Retirement Savings

Leather wallet with money in male hands on dark backgroundAfter most Americans retire, they typically live off a mix of assets squirreled away in 401(k)s, Roth IRAs, traditional IRAs, stocks and bonds, and CDs. Each of these savings plans carries different tax implications as money is withdrawn from it, leaving it up to you to figure out how to maximize your withdrawals and minimize your taxes. Wouldn’t it be nice to not have to pay Uncle Sam any taxes at all?

The answer to your tax woes is whole life insurance, a highly effective way to get out of the business of traditional retirement strategies entirely. With whole life insurance, you can say goodbye to complicated withdrawal strategies (all of which ultimately end up with you getting taxed anyway), and hello to true wealth management. In this post, we will build a case for why you need to change your investment strategy in order to avoid losing your hard-earned retirement income to Uncle Sam:

  • Your goal should be to avoid paying taxes altogether: Most retirees cobble together a strategy in which they seek to withdraw from certain funds in a certain order to minimize the tax implications. It’s an understandable goal, but it wouldn’t it be far better if you could avoid paying taxes on your withdrawals in the first place? Whole life insurance gives you that power.
  • Whole life insurance cannot be taxed: When you purchase a whole life insurance policy and structure it correctly, the money you invest in the policy is not taxed. And as the value of your policy grows, it grows tax-free, meaning your whole life insurance policy serves as a tax shelter for your investments. By contrast, when you sell stocks that are worth more than what you paid for them, you will be hit with capital gains taxes.
  • Your dividends also are not taxed: When you buy whole life insurance through a mutually owned insurance company, you’re entering into a private contract. As you receive dividend payments (not guaranteed but extremely likely), the government cannot tax these dividend payments either, as long as you reinvest the dividends as paid-up additions. The reason is simple: The government cannot interfere with your private contract with a mutually owned life insurance company – you are not even required to report the cash value to the IRS.
  • You can borrow against your policy’s cash value: If the tax benefits of whole life insurance aren’t enough to convince you of why you need whole life insurance, then here’s the real kicker: Your policy has a cash value that you can borrow against to fund other investments – or simply use to enjoy your retirement years. Essentially, whole life insurance gives you tax-free liquidity; what other investment can offer that?

Most retired Americans are losing their shirt to Uncle Sam as they access their retirement income, but you can jump off this bandwagon. The solution is whole life insurance, and the reason it’s such an effective retirement vehicle is that the policy itself is not taxed, your dividends aren’t taxed, and you can access the policy’s cash value as liquid cash to fund your retirement years.

To learn more about saving for retirement, check out our free e-learning series Infinite Banking 101.

Filial Support Laws Say You’re Financially Responsible for Your Parents Long-Term Care

Happy female caretaker assisting senior man in using Zimmer frame at nursing home yardThere are 29 states, plus Puerto Rico, that have filial support laws on the books, and though they’ve largely been ignored, things are changing. A number of recent court decisions show that interest in enforcing these laws has increased and is likely to continue doing so, which means children will now be responsible for covering the costs of their parents’ long-term care.

What Are Filial Support Laws?

Filial support laws state that a child is legally responsible for their parents’ care in certain situations, such as if your parents are ill and do not have enough money to cover the cost of their care. Essentially, if your mom and dad don’t have enough money to pay for their own care, you will have to foot the bill.

There are certain exceptions, such as if abuse of the child before emancipation can be proven, or a minimum of 10 years’ abandonment while the child was a minor.

So, what’s happening now is that nursing homes are suing the children of some of their residents to recover the costs associated with their long-term care. And this lawsuit is usually quite a surprise to those who find letters in their mail demanding exorbitant sums.

How Can You Protect Yourself and Your Parents/Children?

No parent wants to be a burden for their child, just as no child wants to see their parent suffer. This is why the most effective solution is to take out a long-term care insurance policy. These types of policies are designed to cover the cost of long-term services and support, whether these services and the support is offered in the home or in another facility, such as a nursing home.

A long-term care insurance policy allows you to choose a variety of care options and benefits to ensure you get the help you need, when you need it. If you have this type of insurance, you’ll never have to worry that, at some point in the future, when you can’t do anything about it, you’ll run out of financial resources and become a serious burden on your children. You’ll be cared for and your children won’t have to face covering the exorbitant costs such care now implies.

The Hidden Costs of Traditional Retirement Vehicles

Most of us are saving as much as we can for retirement, using the savings vehicles that are advocated by our employer (i.e., the 401(k) plan) and/or by Wall Street in general (i.e., IRAs, mutual funds, stocks). We want to believe that everyone is looking out for our best interests and that all of our hard-earned income is going to be safe. But would it really surprise you to learn that Wall Street is, first and foremost, looking out for itself?

The reality is that Wall Street benefits handsomely from a huge cash infusion by ordinary Americans hoping to secure their retirement savings. But in return, Wall Street offers relatively little security: Wall Street bets big with your money and is none too concerned about whether those investments pay off for you, the individual investor. While you’re hoping your retirement assets will be secure at the micro scale, Wall Street is looking to secure your money – and the money of all other investors – on a macro scale. And this, unfortunately, can come at a very high cost to you – the individual investor.

Let’s explore in greater depth all of the hidden costs of traditional retirement plans that eat away at your hard-earned savings:

  • You are dependent on a volatile market: As history has shown us, the market has its up days and its down days, and the down days sometimes morph into bear markets, where 30% of market value might be eviscerated. Wall Street can recover, but if you’re approaching retirement age or, worse, already retired, can you recover? Traditional retirement savings vehicles are simply too vulnerable to market volatility, and that reality is never going to change.
  • Your income may not decrease substantially enough: When we invest in 401(k)s and similar tax-deferred savings plans, the assumption is that by the time we withdraw the money, we’ll be in a much lower tax bracket and Uncle Sam won’t be able to collect quite so much in taxes. But in reality, we don’t know exactly how much income we’ll need to pull to pay for our expenses, or how much income might show up unexpectedly at our doorstep. While it could certainly be a blessing to end up with an inheritance or other unexpected windfall, the tax implications can be disastrous. Elevated income levels also can trigger our Social Security income to be taxed as well.
  • Inflation could eat away at your nest egg: As we hedge our retirement bets on Wall Street, we’re essentially counting on our investments to not only go up in value, but also to beat inflation. Runaway inflation can quickly reduce the spending power of retirement income, because inflation does not always move in lockstep with the financial markets.
  • Investment fees are costly: When you invest on Wall Street, you can expect to pay exorbitant investment fees; sometimes the fees are hidden or misleading until you read the fine print. For example, “no-cost” mutual funds can actually be quite costly, where you might end up paying custodial fees, managerial fees, administrative fees, shareholder servicing fees, revenue sharing fees and transaction costs. (At least you don’t have to pay a commission, right?) Investment fees eat away at your retirement savings, and there are no two ways around this reality.

The only way to avoid the hidden costs of traditional retirement savings plans is to stop putting so much of your hard-earned income into them and to find alternative investment strategies. Your goals should be to shed your dependency on Wall Street markets, to not subject your money to income taxes, to buffer your investments against inflation, and to avoid costly investment fees.

If you’d like to learn more about alternate investment strategies, check out our video, Life Insurance: The ‘AND’ Asset.

Get the Government Out of Your Wallet! How to Keep Your Money Where it Belongs – With You!

tickets for hundred dollars in a mousetrapPaying taxes feels like an endless game. And guess what? It is. The more money you earn, the more the government takes away from you in taxes! In fiscal year 2015-16, federal, state, and local governments are expected to collect a combined $6.6 trillion. The federal government alone will take more than half of that. Oh, and to put it in perspective, all of these taxes work out to fully one-third of the nation’s Gross Domestic Product!

Wouldn’t it be nice to be able to shelter your hard-earned income from the government? Well, the reality is you can do it if you know how, and more significantly, it can be done legally. The solution is whole life insurance. If you’re scratching your head right now about how life insurance can possibly help you, you’re not alone. In this post, we’re going to make the case for why whole life insurance is the key to protecting your money from the federal government.

  • The federal government is never going to give you a tax break: Let’s face it; you’re going to work hard for several decades and probably double or triple your annual income in your lifetime – but every year, the government is just going to take, take, take. The nation’s progressive tax system ensures that the more taxable income you earn, the higher your effective tax rate.
  • You’ll still be taxed post-retirement: Most Americans today are putting a big chunk of their retirement savings into the ubiquitous 401(k) savings account. It feels good to not pay taxes on the income you’re deferring into your retirement plan. But the government still is going to take its share of this money; you’re just deferring paying taxes on this income until you withdraw it. Presumably you’ll be in a lower tax bracket in your retirement years than when you were working, but you’ll also be living on a fixed income by then.
  • The key is keep your assets private: The best way to (legally!) prevent your financial assets from being taxed is to find a way to enter into a private contract between you and a mutually owned insurance company. The government cannot tax you in this situation because the government cannot interfere with a private contract.
  • Whole life insurance acts as a tax shelter: When you structure a whole life insurance policy correctly, the money you invest in the policy is not taxed because your policy grows tax-free. You can even receive retirement disbursements without penalty or tax. And although a whole life insurance has a cash value, you are not required to report it when you’re filing your taxes. At the same time, you can access the cash value by borrowing against it, allowing you to fund other aspects of your life.

Whole life insurance is a game changer because it’s the best way to shelter your financial assets from being taxed. The reason it’s so powerful is because of the reality of how the tax system is structured: You’re never going to get a break on your income taxes, and you’ll still be taxed even after you retire. Thus, the key is to use whole life insurance to keep your assets private and out of Uncle Sam’s hands.

If you want to learn more about protecting your retirement income, read Access Your Savings Tax Free.

Are You Too Young to Start Preparing for Retirement? Or is it Already Too Late?

European-looking boy  of ten years  in glasses thinking intently book on a blue background retroHave you calculated how much money you’ll need to live comfortably in your retirement years? No doubt you’re saving for a retirement date that probably feels nebulous and impossibly distant, but have you actually run the numbers to know how much you’ll need?

Let’s say you’ve saved $1 million for retirement and you live for 20 years after you retire. You’d have access to up to $50,000 a year. That may sound like enough to you, until you consider that it’s probably far less than you’re earning right now… and inflation may skyrocket in that timeframe… and you could live a lot longer than those 20 years. This is precisely why you need to stop saving blindly for retirement. The way to really, truly prepare yourself for your golden years to eliminate your fear of the unknown. Here are some strategies you can implement now to start thinking critically and carefully about preparing for retirement, no matter your age:

  • Invest in yourself: The most basic way to combat fears of the unknown is to invest in your financial education. You should learn much more than just how to follow the stock market; you should learn how to read financial statements, how to assess the benefits and risks of an investment, and how to leverage your investments for maximum return and minimal taxation.
  • Become more cognizant of your spending: Everyone deserves to spend their hard-earned money as they wish in the pursuit of happiness, but you also must consider that money is a finite resource. The things that seem important to you now while you’re earning a steady paycheck may not seem so important to you later in life – when you’re living on a fixed income and have mounting healthcare expenses and other age-related expenses. Therefore, you should become aware of how you’re spending your money now, to make sure your present-day expenses don’t hinder your financial security in your golden years.
  • Understand how bear markets impact your retirement: For simplicity, many people assume their 401(k) and other retirement accounts will yield a standard annual rate of return, perhaps 8% a year. With compound interest, that can add up to a sizeable nest egg by your golden years. But what happens if your investments become the victim of a bear market just as you’re approaching retirement or, worse, after you’re already retired? If you were to lose 30% of a retirement portfolio valued at $1 million, you would need your portfolio to rise by nearly 50% just to get back to where you started! You cannot ignore this possibility in your financial planning.
  • Recognize that a $1 million retirement goal isn’t sufficient: The average American tends to think the magic number at which to retire comfortably is $1 million. But given that so many factors are out of your control – inflation, soaring healthcare costs, how many years you’ll live – an artificial number really isn’t the smartest way to plan for retirement. The secret is to cast aside traditional retirement savings vehicles and instead develop a comprehensive wealth management strategy that provides security and liquidity and acts as a hedge against inflation.
  • Don’t let Uncle Sam poach your retirement nest egg: With traditional retirement savings plans like the 401(k), you’re going to be paying taxes on your money as you withdraw it. And when you die, unless you’ve proactively taken proper precautions, Uncle Sam is going to tax your estate before your loved ones get a penny of it. Given these unfortunate scenarios, you need to think creatively, and legally, to get around paying these taxes to the government. Whole life insurance, which involves a private contract between you and a mutually owned insurance company, is one of the best out-of-the-box solutions, because as a private contract it cannot be taxed.

While you may think you’re on solid footing by putting aside money for retirement, you actually could be in big trouble if you’re not truly planning for it. The keys to preparing for retirement, no matter your age, are to invest in your financial education, become more conscientious of your spending, understand how bear markets impact your retirement, recognize that an arbitrary retirement goal is insufficient, and think creatively to avoid letting the government impose heavy taxes on your retirement savings.

Learn more about preparing for retirement, no matter your age, in our webinar – Getting Ready to Retire at Any Age.

Do I Really Need a Monthly Budget? Why Your Answer Should Be: Absolutely!

Lanzando avin de papel de billete de dlar.If you’re earning a steady paycheck and can afford the things you desire in life, you probably are asking yourself why you need to set a monthly budget. People who live paycheck to paycheck set budgets because otherwise they would run out of money (quite literally!), but what value is a monthly budget to the rest of us?

The reality is that we all have expenses that can quickly get away from us. You need to think about your future; you can’t simply spend like there’s no tomorrow. Whether you’re ready for it or not, tomorrow is right around the corner, and the last thing you want to do is to put yourself and your loved ones into financial peril because you couldn’t manage to stick to a budget. Let’s dig deeper into the reasons that you absolutely need to set a monthly budget, no matter how financially secure you may be feeling today:

  • Most of us have enormous expenses: If we’re fortunate enough to have purchased a house, and raised kids who seek to matriculate to a four-year college, and made plans to retire in our 50s, we’re actually deep in debt, even if we don’t think of it that way. The average U.S. mortgage debt, for example, stands at $155,361. The cost to send a student to a four-year college averages $23,410 per year – and that’s to attend public school! And you certainly want to live comfortably in retirement; you’ve earned it, after all.
  • You need to expose how much you’re really spending: It’s easy to use plastic to make purchases, and it’s equally easy to pay off a credit card bill when there’s cash is sitting in your bank account. But why do you want to let your ability to pay for your lifestyle dictate your willingness to pay for this lifestyle? You are much better off if you know exactly how much you’re really spending, so you can have frank conversations with yourself and loved ones about where your financial priorities should lie.
  • Your income will drop eventually: Unless you are planning to work full time until the day you die, you aren’t going to always make the same income you do now. Thus, by creating a budget now, you’re setting yourself up to understand how much your lifestyle costs you, so that you can plan more accurately for your retirement years. You deserve to live the final years of your life without stressing over money.
  • You can pre-allocate for recurring big-ticket expenses: Americans tend to feel financially stressed after they’ve paid all of their bills, and more free-wheeling after they’ve received a paycheck or other cash infusion. In reality, we should be feeling neither of these things; we should be thinking of our income in a much more long-term fashion. The key is to set up a monthly budget that pre-allocates money to pay for recurring, big-ticket expenses. For example, we might have huge outflows of cash during the holidays, when property taxes are due, and when our children’s college tuition bill comes due. Rather than feel financially stressed during those months, we can build a monthly budget in which we pre-allocate funds each month to pay for those big expenses before they come due.

When you invest in creating a monthly budget for yourself and start to see results, you’ll feel so empowered and financially secure that you’ll wonder how you ever survived without it. Remember, with a monthly budget, you’ll be able to get a true sense of your debts and how much you’re really spending, plan for the day that your income drops off precipitously, and pre-allocate money to pay for your big-ticket expenses.

Want to learn a better way to save? Check out our Infinite Banking 101 video series.


Whole Life Insurance – Not What You Think

Multi Generation Family Running Across Field TogetherIronically, when many people hear the words “life insurance,” they often think of death and how a life insurance policy can financially protect their loved ones. While term life insurance is just that – a death benefit – whole life insurance is much more. Whole life insurance is an asset that comes with many living benefits that are advantageous for the policy owner while he or she is still alive. In fact, these living benefits may make the policy far more valuable than just a death benefit.

Life insurance can seem convoluted and difficult to understand – both term and whole life. So, it’s no surprise when whole life insurance is overlooked as a viable, lucrative investment option.

Here are a few reasons that whole life insurance may not be what you think it is:

  • It’s not just death insurance: The value of “death” insurance can only be accessed at, well, the time of death. But whole life insurance is much more than “death” insurance. It offers specific benefits to the policyholder during life that are at the heart of wealth-building. And when these benefits are used correctly, a whole life insurance policy also continues to provide all of the death insurance benefits that we traditionally think of when we think about life insurance.
  • It’s not just for corporations and the ultra-wealthy: Banks, corporations, and the ultra-wealthy invest heavily in whole life insurance. They have done so consistently for many decades, because they understand that it’s a secure place to grow wealth that offers liquidity, reliable cash-paying dividends, and a hedge against inflation. These are all wealth building benefits you too can reap with a properly structured whole life policy.
  • Your investment is safe and secure: Whole life insurance is one of the oldest, most stable types of investments on the market. It’s insulated from the incredible volatility of the financial markets, and it’s a tightly regulated industry – more tightly regulated than Wall Street, in fact – better protecting your money.
  • It’s really an asset, not an investment: Whole life insurance may be technically referred to as an investment, but the reality is that it’s more of an asset than an investment. When structured correctly, investors can access the full cash value of their whole life insurance premiums from Day 1, using it to purchase more whole life insurance or make other investments. That’s right – even while you continue to own a whole life insurance policy, you can treat the premium’s cash value as your own private bank from which to draw liquid cash.
  • You aren’t giving up steady dividend payments: The average investor has come to expect that their investments in stocks, mutual funds and so forth will pay a dividend, at least during strong years. Whole life insurance does too, and because the industry is so stable, these dividends are guaranteed. New York Life, for instance, paid dividends during the Great Depression. You can apply your annual dividends to your premium payment to offset your out-of-pocket cost, or roll it back into your policy to add more cash value (and death benefit) to the policy.
  • You are not paying full taxes on earnings: The IRS does not consider whole life insurance dividends to be earned income, but rather a return of your premium, which means with a properly structured policy dividends are not automatically taxed.

When utilized correctly, whole life insurance can be an asset that builds cash value, gives you more financial freedom, and puts you on a wealth-building path.  Whole life insurance absolutely isn’t what you think it is – it’s not just death insurance, it has living benefits that you can use throughout your life in addition to providing for the financial security of your family.

Want to learn how to protect your life insurance policy? Take a look at this webinar to learn how.

Funding Large Expenditures on Your Current Income

Gold coins graph, gold coins on a wooden table

The No. 1 financial fear for most people — especially baby boomers — is running out of money and not being able to pay for any major expenses that might happen down the road. They worry about having enough money for their children’s college education, struggling to pay off hefty home mortgages, and prematurely zeroing out their retirement savings.

These fears are heightened by stagnating incomes and increasing inflation, especially for healthcare costs. This opens up the question: Will you be able to afford your major expenses for the rest of your life? The wealth builders at Paradigm Life believe it is possible to live a comfortable life even if you never earn significantly more than you do today.

Here are the five steps you should take to ensure you can fund all of life’s major expenditures on your current income:

  • Recognize the underlying reason you’re fearful: If you are concerned about outliving the money you’ve saved for retirement and not being able to afford your expenses for the rest of your life, an underlying reason you’re fearful is because the most common retirement savings vehicle – the 401(k) – is setting you up for financial volatility. Wall Street benefits from the enormous infusion of investment cash from ordinary Americans, but many of these individuals ultimately are crushed under the uncertainty of market forces.
  • Stop concerning yourself with market yields: Because the 401(k) and the stock market in general are at the heart of your financial fears, the key is to disassociate yourself permanently from this rat race. Instead of turning to financial advisers and investment bankers to manage your investment portfolios, you should be turning to wealth strategists. Wealth strategists don’t live and die by market yields – their sole job is to invest in the financial products that make the most sense for you, not for Wall Street.
  • Stop trying to hit a magic number for your savings goal: Your savings goals shouldn’t be defined by a single numerical goal (for example, $1 million for retirement) because it’s an arbitrary number that doesn’t necessarily mean a comfortable retirement. First of all, you have little control over inflation, especially healthcare costs. You also don’t know exactly how long you’ll live. Instead, the key is to develop a comprehensive wealth management strategy that provides security and liquidity and acts as a hedge against inflation.
  • Build a secure foundation: To develop a solid wealth management strategy you need to have guaranteed growth that is insulated from the volatility of financial markets, is a secure investment and can become a liquid asset for any expense – whenever you need it. A properly structured Whole Life Insurance Policy fills all of these requirements.
  • Start to double dip: With a whole life insurance policy, the full cash value can be accessed by borrowing against the policy, at a low-interest rate, and using that cash value for virtually anything – buying a house, college tuition, retirement income, and so forth. Although you’re using your cash value to fund other investments, your policy retains that cash value and you’re not hit with a tax liability; in fact, you still earn dividend payments and interest on the borrowed value. The ability to access this cash value is how you can effectively leverage your existing financial resources.

No one wants to be in a situation where they become a financial burden to their children and loved ones because they cannot afford major expenses in life. The key to creating real wealth, even assuming you never earn more than you do now, is to understand the underlying reasons you’re fearful about running out of cash and to realize that there are better alternatives to the volatility of the traditional investment vehicles that rely on the Stock Market.

Continue your financial education with our free Infinite 101 eLearning courses.

S.O.S! 3 Reasons to Rescue Yourself from a 401K

Rescue Your Retirement
S.O.S! 3 Reasons to Rescue Yourself from a 401K
S.O.S. is the international distress signal and it more than applies to why you should rescue yourself from relying on volatile, market-dependent IRA and 401K accounts. There is something better, the Infinite Banking Concept (IBC). This is the tool you need to take control of your financial life as quickly as possible.


When you put your money in an IRA or 401K, you are dependent on the market, which we have seen can be extremely volatile. Today, you have a nice nest egg, tomorrow you could be flat broke, thanks to how quickly the market can change direction and its cyclical nature.
Plus, the economy is becoming increasingly interdependent with other countries so that if China has an issue, for example, we will feel in the U.S. almost immediately, which further increases the risk.

With the Infinite Banking Concept, you aren’t dependent on the market in any way, which means you aren’t exposing your retirement and savings to any risk at all. Your money will be safe.


There are numerous obstacles to building wealth and amassing a nice retirement nest egg, but the two main ones are fees and taxes. The fees and taxes that apply to 401Ks and IRAs are so exorbitant, that it’s practically impossible to build wealth. In fact, you’ll be lucky if you earn enough just to cover inflation.

You might point out that you’re not paying taxes on your 401K or IRA now, and that’s true. But you will in the future, and the one thing taxes won’t be doing is going down. You’re very likely to end up paying much more in the future as taxes are clearly trending upwards. IBC has many tax advantages that could reduce or eliminate that heavy tax burden.


Do you want your family’s current standard of living to be affected if you were to pass away suddenly? Of course not! Would you rather have a plan in place that will ensure your family can achieve their dreams and aspirations without having financial woes? Of course!

You can say that you will leave them an inheritance, so why should you worry? They’ll be taken care of, right? Yes, they will, but do you really want 25 to 40 percent of your wealth disappearing in the government’s pocket?

So, why leave an inheritance, part of which will go to the taxman, when you can transfer your wealth using a life insurance policy with a death benefit? The Infinite Banking Concept utilizes life insurance policies with death benefits that aren’t subject to income tax, which means it’s the most effective way to take care of your family without having to worry about how much they’ll have to pay in taxes.

So, safety, obstacles, and security (S.O.S.), is precisely why you should reconsider and start applying the Infinite Banking Concept now. After all, don’t you want your money safe from the volatility of the market? Don’t you want to build wealth without fees and taxes slowing down your progress? Don’t you want your family to be taken care of without having to hand over a huge chunk of your wealth to the government? Of course you do! And that’s precisely why you need to reconsider your position and get on the IBC train now.