‘Retirement’ is a buzz word in the financial industry that we don’t like to hear. That is because too often individuals we work with either believe their qualified plans are the repository of all plans, so they’re closed off to better options; or the opposite exists, where individuals realize their retirement strategy isn’t working and they are scared out of their mind.
Do you fall into one of those two categories? We’re putting ‘retirement’ (also known as qualified plans) on the table, stripping it from misconception, and serving it up raw so you can taste it for what it is.
Kill your “Number”
Retirement plans like the 401k and IRAs mostly benefit your employer or the IRS – not you. They have too many mandates that prevent you from being in control of your savings and truly being prepared for retirement.
Because you can only contribute so much and your company will only match up to so much, individuals saving for retirement inside qualified plans focus on getting to “their number.” But getting to ‘your number’ will not give you the retirement you’re looking for. One must consider:
- Healthcare Costs
- Independence (financial and physical)
Many financial advisors tell people that by the time their retirement hits they won’t have kids or a house to pay for so naturally they will require less money to live on. False. A study done by the American Consumer Credit Counseling revealed that one in three households provide financial support to adult children. (Bloomberg Business) “The more boomers put out for adult kids, the less they can put aside for themselves, which is scary as they live longer and need savings to last them into their 80s and 90s,” says Pamela Villarreal of the National Center for Policy Analysis.
For some reason the current number trend for retirement is having 1 Million. One million is 10x more than the National retirement average of today.
The Federal Reserve revealed that most people ages 65-74 had a total of $148, 900 saved for retirement. Those who were 55-64 had only $103, 200 saved. (The Motley Fool) How does anyone expect to live without working on that amount over a 10-30 year period?
There is no such thing as “your number” because regardless of how much you save into a qualified plan, you’ll still be behind the curve.
Get Real With an Alternative Plan
When companies began shifting from pensions to 401k(s) in the 80’s, most didn’t realize how unfair the qualified plan was because there was no history to show for it. Now, after the 2008 meltdown when everyone’s 401(k) was lost in the crash, we finally started realizing the disadvantage we’d been leveraging all of these years.
In a way, it’s like we didn’t know any better because the qualified plan was the only retirement strategy employers offered. There is an alternative plan, however, with Whole Life Insurance.
Whole Life Insurance is more than a retirement plan, it’s a wealth building strategy that the ultra-rich have used for hundreds of years to keep their money working for them and their families.
Whole Life offers living benefits that surpass other investment strategies by a long shot, and to make things clear, Whole Life isn’t an investment, it’s an asset.
With a properly built policy your money grows with tax benefits (if not tax-free), you earn a steady rate of return, and you can privately bank. The wealthy have never stopped using Whole Life because it provides security, liquidity and acts as an inflation hedge.
To us, Whole Life is about wealth building, not just retirement, but it can successfully cover your retirement needs when you get to that point – if you’re not already there now. The word “retirement” has lost all credibility to us, because when we work with clients we focus on wealth as a whole, before, during and after “retirement.”
For more information visit Infinite 101, our FREE eLearning course on wealth.