Simply put, yes you can! Its all in the vehicle in which you begin your retirement savings. People get so caught up in the daunting decision of which account to use for retirement: 401(k)s, Roth IRAs, SEPs, Simple IRAs, and more. All these accounts can help you save similarly. The distinction lies in the tax codes the government has created for each. So which one will give you a tax-free retirement? Technically, the Roth IRA is the only retirement savings account that can do that. However, its status as a tax-free account means youre taxed on your contributions NOW, and youre limited as to how much you can contribute each year. There are alternatives to reaching your retirement without paying a huge chunk of your savings to the government, though. Many people arent aware of the 7701 tax code which states that life insurance benefits to an individual are tax-exempt. This opportunity means there are ways to accumulate retirement funds without the opportunity to lose principal and have your income distributed in a tax-free fashion. Fidelity Financial Co., LLC White Paper
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CAN I REALLY HAVE A TAX-FREE RETIREMENT?
An Index Universal Life (IUL) policy
guarantees that you never lose your principal and captures a portion or all of the market gains. You can have a life insurance policy with a flexible premium that will allow you to overfund, where the excess money goes into a bucket that earns interest based on an index. Meanwhile, youre protecting your family in case anything happens to you. If you utilized the S&P Index and averaged 7.5% on your excess, after-tax monies for the next thirty years, what kind of gain would you have? What makes this plan even more appealing is the promise that if the S&P has a losing year, you wont. If it has a winning year, you do. Think about the power of compound interest and never having a losing year during your accumulation phase!
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Your distribution phase determines whether
you have a tax-free retirement. By taking a loan against your cash value after you are no longer contributing, you cannot be taxed. The money you contributed is after tax. When you take distributions, you do so in the form of a loan. When you buy a new car are you taxed on the loan? You may have an excise or luxury tax, but the government cannot tax the loan
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CAN I REALLY HAVE A TAX-FREE RETIREMENT?
you took out to get the car. This strategy can be
used annually with the right planning. Visit your financial planner today to set up an IUL policy for your long-term financial strategies. Other benefits of this plan include not waiting until 5912 to take out money, never losing your principal, more leverage for more gains, protection of your family, and more.
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CAN I REALLY HAVE A TAX-FREE RETIREMENT?
Fidelity Financial Co., LLC
215 S. 88th Street Omaha, NE 68114 Mark T. Houston (402) 880-7008 [email protected]