Learn the Advantages of Tax–Free Retirement? · 2012-08-21 · - $$$ Tax Free Retirement Income -...

© Asset Protectors & Advisors Group

Learn the Advantages ofTax–Free Retirement?

An Educational Workshop

A Discussion of ARetirement vehicle,Saving taxes and makingthe most of your money.

Presented by: Jim Grazioli - President

Comprehensive Financial Group Inc.

Financial Service Professional – 21 Yrs.


Facts About National Debt1

• $13,434,929,315,731.47 – “Official” US Debtas of 9/8/101

• $9,381,368,108,595.10 – “Official” US Debtas of 3/6/081

• Over $4 trillion “Official” increase in 2.5 years

• Real National Debt is $74,791,829,000,000.002

- What’s the difference between the “Real” and “Official”?

• Your share of the real US debt is: $243,000.002

1. US National Debt Clock www.brilling.com/debt_clock

2. Truth in 2010 http://www.truthin2010.org/


There are only two ways tocombat the growing debt…

1. Spend Less

2. Tax More


Are we spending less as agovernment?

We are spending morethan we ever have in the

history of our country.


So the only solution seemsto be…

Higher TAXES

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1. ARE FEDERALINCOME TAX RATESCURRENTLY HIGHOR LOW?

Answer: Low (The 3rd Lowest in U.S.

History)

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WHAT TAX RATE WILLYOU PAY WHEN YOURETIRE?

Are you CreatingRetirement Tax FreeIncome?


How important is Tax-Free? The following example will illustrate the

beauty and magic of tax–free growth

Which would you choose to pay taxes on?

The seed or the full grown tree?


Whose Retirement are wereally planning?

Ours orUncle Sam’s?


When you put your moneyinto an IRA or 401(k) are youreally saving tax?

You do NOT save the tax, you defer thetax and the tax calculation.


Qualified Plans Like 401K,IRA, do Two Things

1. Defer the tax

2. Defer the tax calculation

Qualified plans maynot save taxes at all.

They may causeadditional taxesin retirement!


Future Tax Rates

If you believe future tax rates will behigher, why would you want to defer thetax calculation into the future?

Higher?

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Have you prepared anykind of an exit strategy?

YOU HAVE QUALIFIED PLANS:

Traditional IRA- No Tax Control

401K – No Tax Control

SEP – No Tax Control

SIMPLE IRA – No Tax Control

403B – No Tax Control

Go to the next slide for the TaxFree Retirement Answer!


The Solution:A Properly StructuredLife Insurance Policy

MAXIMUM

Cash Value

MINIMUMTerm Insurance

(No Cash Value)

Liquidity, Use & ControlTax–Free WithdrawalsTax Deferred Growth

Creditor ProofMinimum Guarantees

Earn Competitive InterestDisability Waiver

Estate Tax Advantages

Liquidity, Use & ControlTax–Free WithdrawalsTax Deferred Growth

Creditor ProofMinimum Guarantees

Earn Competitive InterestDisability Waiver

Estate Tax Advantages


Why is this Product Tax Favored?Section 72(e) and 7702

The most unique feature of permanent life insuranceis that under Section 72(e) and 7702 of the InternalRevenue Code the accumulation of cash inside theinsurance contract is tax advantaged. Not only canthe cash value accumulate tax free, but the cash canalso be ACCESSED TAX FREE VIA POLICY LOANS, and isNOT CONSIDERED A DISTRIBUTION OF INCOME!

Hence, the beauty and magic of life insurance: It is aunique vehicle that allows TAX FREE ACCOUNT VALUEACCUMULATION, ALLOWS YOU TO ACCESS YOURMONEY TAX FREE, and, WHEN YOU DIE, The DeathBenefit is Paid INCOME TAX FREE to your Beneficiary!


Indexed Universal Life Policy GOALS:

- Have a potentialfor Annual IndexInterest up to TheCeiling 12% withoutrisk of principal

- Create Your OwnBank with the Useof Cash Value

- $$$ Tax FreeRetirement Income

- Income Tax FreeDeath Benefit

Ceiling 12.00%From Annual Index Returns

Floor 2.00%Never a Market Loss

“CAP”


S&P Index vs Equity Index Universal Life11 Year Comparison

A cap of 12% and a floor of 2% using an annual point to point option

YearHistorical Return

of S&P 500$100,000

Basis

Index UniversalLife Policy

$100,000Basis

1999 14.82% $114,820 12.00% $112,000

2000 -10.14% $103,177 2.00% $114,240

2001 -13.04% $89,723 2.00% $116,524

2002 -23.37% $68,755 2.00% $118,854

2003 26.38% $86,892 12.00% $133,116

2004 8.99% $94,704 8.99% $145,083

2005 3.00% $97,545 3.00% $149,435

2006 13.62% $110,831 12.00% $167,376

2007 3.53% $114,743 3.53% $173,284

2008 -34.12% $75,593 2.00% $176,749

2009 35.00% $102,050 12.00% $197,958

Acct Balance $102,050 $197,958Avg ROR 2.24% 6.506%


Case Study:

45 Year Old Male

$50,000 ContributionPer Year for 20 Years

$100,000 TAX-FREE Income Per YearPaid to Age 100 Starting at Age 65

Tax Savings: $17,250 Per Year X 35 yrs. = $603,750 (25% Tax Bracket Married Filed Jointly)

Assuming an average of 6.50% Index Rate of Return With a Cap of 12%

To Summarize:The Benefits

1. Annual Tax Free Income $100,000

Starting at Age 65 Paid to Age 100

2. The Annual Tax Savings - $17,250

3. Ability To Use Your Cash Value During Accumulation for:

Large Item Purchases, Education, Business Expansions

4. Income Tax Free Death Benefit - $2,886,092 From Day 1

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What to look for when selectingan Insurance Company

Solvency (Assets over Liabilities to meet allobligations)

Liquid Assets (To meet unforeseen emergencycash requirements that may arise)

Capital & Surplus to Assets (Capital &surplus divided by total assets)

AM Best Rating (Performance in InvestmentQuality, Policy Reserves, Cost Control, ManagementExperience)


Remember the Nature of

Procrastination

People Don’t Plan to Fail

They Fail to Plan

Learn the Advantages of Tax–Free Retirement? · 2012-08-21 · - $$$ Tax Free Retirement Income -...

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