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In a nutshell, it can be a better long term savings alternative than ROTHs, standard IRAs, all 401(k)s, and most other tax-deferred plans because there are no upper limits to your contributions, there is no upper annual income limit, you can begin tax-free income withdrawals or tax-free loans at any age with no IRS imposed early withdrawal penalties, you won’t be saddled with RMDs as with standard IRAs and Sep-IRAs, all 401(k)s, 403(b)s or any other tax-deferred savings plans, and your account cannot lose money.
Existing IRAs, old 401(k)s, and many current 401(k)s can easily be converted from tax-deferred retirement money into our tax-free retirement strategy.
Perhaps most importantly, you’ll never have to worry about stock market collapses that affect all IRAs, all ROTHs, 401(k)s and 403(b)s, and just about every other tax-deferred savings plan, because your account takes advantage of stock market gains, but is 100% protected from all stock market losses because your principal and annual gains are never actually at risk in the market.
Professionals in one industry usually don’t have the time or expertise to invest in a different industry such as real estate or other business ventures without relying on expensive outside management companies or putting their trust in someone else to run a business. Real estate can collapse just like it did in the 2008 fiasco, and businesses fail all the time for a variety of reasons, including mismanagement or lack of know-how.
Sometimes the risks and management headaches of investments like these outweigh the rewards, and you have to remember that no one you employ cares more about your money than you do.
In short, if you are looking for a risk free and management free retirement plan with decades of time proven performance and 100% IRS compliance, this could be the strategy you’ve been looking for. Why not contact us to see how this strategy could work for you and your loved ones?
Robert and Frank are 30 year old professionals, each earning a respectable $275,000 per year, which puts them into an effective 2024 Federal income tax rate of about 25%. Both brothers have been hounded by people and companies they’ve never heard of trying to get them into one questionable investment after another, and they don’t know who they can really trust with their retirement money. After much discussion and research, they decided it’s time to set up their own savings plans so they can retire at age 60. Interestingly enough, they chose very different pathways to reach their goals. Let’s compare the hypothetical results of each plan if we fast forward 30 years into the future ……………… *
Robert contributed the 2024 maximum of $23,000 per year into his company 401(k). His total contributions over the next 30 years using the same $23,000 figure were $690,000 with a total of $172,500 in “tax-deductions” taken over the last 30 years with a 25% Federal income tax rate. As his 401(k) grew an average of 7% per year, it was worth $2,348,000 by age 60. Robert was proud of the fact he was diligent in his savings plan over all those years. Unfortunately, it wasn’t all Robert’s to spend in retirement*.
Now retired, much to Robert’s surprise the IRS came calling for “their slice” of his retirement pie. Although he had never touched his 401(k) while he was working, when Robert retired and began withdrawals his entire 401(k) became taxable at his new Federal tax rate of 35%. So out of the $2,348,000 in Robert’s 401(k), he learned that more than $821,000 was now payable to the IRS in taxes*. Needless to say, Robert was shocked and angry.
In exchange for the IRS allowing Robert to “delay” paying the $172,500 in taxes on his contributions for the past 30 years (that’s only $5,750 in taxes delayed per year), Robert is really shocked that he will be left with only $1,526,000 to spend in retirement.
When he stopped to think about what he and his wife could have bought or the number of vacations they could have taken with this additional $821,000 he was not happy. Robert realized that unless he and his wife cut way back on their current lifestyle, they’d be lucky if this money lasted for another 15 years. He’s also worried that his 401(k) could take another hit because of the next recession that his financial planners have been predicting. If the same thing happened to the stock market as the 53% collapse in 2009 to 2011, he knew they’d be in big trouble.
So how did his brother Frank do with his retirement strategy*? Frank discussed his goals with the specialists at Ten Tigers Group back in 2024 and decided to contribute $23,000 per year in after-tax money ($31,000 pre-tax) into a customized Tax-Free Retirement strategy that they strongly recommended for him based on his annual income. Frank’s account grew stress-free for him and his wife because unlike Robert’s 401(k) that repeatedly suffered stock market collapses and “corrections” over the years, his account couldn’t lose value because his money was never actually at risk in the stock market. After 30 years, Frank had contributed the same $690,000 as Robert and it also grew to a considerable sum at Frank’s retirement.
Here’s the big difference: None of Frank’s retirement account was taxable. None of it!
So in exchange for paying the lower 25% income tax rate on his contributions while he was working, Frank is enjoying over $215,000 in annual tax-free income for the rest of his life. Now that Federal income taxes have risen to 35%, he knows this is the equivalent to making over $331,000 in gross income per year. Frank and his wife are very happy he paid the income taxes on his contributions while he was working instead of being saddled with Robert’s huge tax bill at retirement of $821,000.
Frank doesn’t care what the Federal income tax rates are in 2054 because the income from his plan is tax free! Instead, Frank and his wife are excited about all of the extra vacations they’ve enjoyed and how much better their lifestyle is now because he took the Tax-Free Retirement road instead of the other one “way back in 2024”. *
So which brother had the better long range retirement plan*? Which retirement plan would you rather have?
Bottom line: Because he didn’t find out the truth about his 401(k) until he retired and began withdrawing money, it was too late for Robert to do anything about it. Fortunately, you don’t have to fall into the same IRS distribution trap that he did. You can invest as much as you want of your after-tax dollars into a plan today that provides tax-free and creditor proof income at any age or tax-free loans at any time, with no surprises from the IRS after you retire. The Ten Tigers Group can provide the plan you need today to provide the income you need to afford the retirement lifestyle you want later.
*Note: This a hypothetical example designed to illustrate a concept, and is not to be misconstrued as actual tax advice since everyone is different and we are financial advisors, not CPAs. The illustration is based on information we believe to be accurate as of 2024 and the current and future projected income tax rates were used to demonstrate possible results whether tax laws stay the same or change. Future values are for illustrative purposes, and are not guarantees. No one knows what the income tax rates will be in 30 years, but the possibility of Federal income tax increases because of financial mismanagement and out-of-control Federal spending is something you should probably plan for just in case. You are encouraged to consult with your CPA to discuss your own income tax situation and the future income you might need to afford the lifestyle you want at retirement.
Business owners can take advantage of an IRS ruling that permits their own business to fund their personal retirement while their business takes a tax deduction for the entire contribution. ROTH IRAs and ROTH 401(k)s don’t allow contributions to be tax deducted, but our strategy does. The business owner has complete control and ownership of the plan, and no IRS approval or cumbersome legal paperwork is required. Owners can even include their most valuable employees in this strategy if they wish. Business owners don’t have to rely on selling their business someday to fund their retirement as it can be fully funded by their own business while they are still working, and their business can take a 100% tax deduction for the entire amount. If you own the business, saving for your personal retirement doesn’t get any better than this.
Go to the Solo 401(k) FAQ to see how this could have affected Erica’s retirement savings strategy.
Simple. Both IRAs and 401(k)s work basically the same way as the IRS gives you a small “tax deduction” now in exchange for you paying a much larger amount in income taxes to the IRS when you start withdrawing income in retirement. It’s genius! The part no one tells you about is that it’s not really a tax-saving deduction, it’s actually a tax-deferring deduction, and that you’ll be paying Federal and State (if applicable) income taxes on all your “deductions” plus taxes on all the growth of these contributions when you retire. So is the IRS really doing you a favor by allowing these small income tax “deductions” on this year’s return? What do you think?
Think about it: The Federal government needs an unlimited amount of tax revenue it can spend on their programs, so it structures their government sanctioned retirement savings plans to maximize their future tax revenue. Nobody knows how high your income taxes will go over the next 20 or 30 years, but it’s safe to assume that future Federal income taxes will have to increase to pay for their unending future wars and unaffordable handout programs.
Unfortunately, many people don’t realize until retirement that all withdrawals from their government promoted 401(k)s and standard IRAs are 100% taxable. Many do know that withdrawals from ROTH IRAs are usually tax-free after age 59 1/2. In addition, some people have never been told which of these three common options will generate the most tax revenue for the government when they retire, but if you guessed 401(k)s and standard IRAs, you are correct. Yet year after year, people maximize their contributions into these plans without knowing there had been other savings options available to them until they have retired many years into the future. If only someone had told them when they first started.
The Federal government knows that someone who invests the 2024 annual maximum of $7,000 per year ($8,000 per year if you are older than age 50) in after-tax income into a ROTH would total about $225,000 in contributions over 30 years assuming the $7,000 and $8,000 annual amounts hadn’t changed. If these funds grew at an average rate of 7% per year after allowing for both stock market ups and downs, their account could be worth about $740,000 in 30 years when they retired. So how much of that amount is taxable? ZERO! This is very good news for you, but not so much for the government.
As a side note, having a balance of $740,000 to retire on in 30 years sounds good until you realize it won’t go very far with inflation reducing your buying power by 50%, 60%, or even more. Don’t believe it? Thirty years ago, a 1993 Ford Mustang convertible sold for about $20,293 according to Ford Motor. In 2023, the same car sold for about $42,574, more than double the 1993 cost. Thirty years from now using the same low 30 year sticker price average increase of only 2.4% per year, a 2053 Mustang convertible with the latest technology would cost about $89,400. Even worse, it could cost more than $184,000 if we use the actual Mustang price hikes that averaged 5% per year for the past 56 years. For a Mustang convertible! Don’t believe it’s been 5%? For proof, check out the cost of a 1967 Mustang convertible. (Hint: it was $2,814 brand new) This is what real inflation looks like, not some made-up government fairy tale. Don’t you think it’s a good idea to plan for this in advance?
Using the same low inflation rate of 2.4% again, a ROTH with an account value of $740,000 in 30 years would have the purchasing power of about $370,000 today. But if you use the actual Ford Mustang’s price increase average of 5% per year, this ROTH would have the purchasing power of about $165,000 in today’s dollars. Again, this is called real world inflation. Has anyone ever mentioned the reduced future purchasing power your retirement accounts will experience due to inflation? If not, you should probably ask a trusted advisor. We call this a financial iceberg, and if you were warned this could happen to your retirement income actual buying power in 30 years, you could adjust your plans accordingly.
Conversely, someone who invests the 2024 annual tax-deferred maximum of $23,000 into a 401(k) would have a total of about $690,000 in contributions over the same 30 year span assuming the $23,000 annual amount hadn’t changed. If these funds grew at the same average rate of 7% a year, the account could be worth about $2,348,000 in 30 years when the person begins withdrawals in retirement. How much of that is taxable? All of it!
What if you retired in 30 years with an effective income tax rate of 30%? The IRS income tax burden would be at least $704,000 in total taxes upon withdrawal, plus 30% of all future growth! It makes you wonder whose retirement you are actually funding. This is very good for the government, but not so good for you. But if your future tax rate had actually increased to 40%, the tax burden would start out at a mind-numbing $939,200.
So which government controlled retirement option do you think the IRS wants to encourage to maximize their future tax revenue?
Let’s review: The ROTH option above would generate NO Federal taxes at retirement, but the 401(k) option above generates $704,000 in income taxes if you’re at a 30% effective Federal income tax bracket or even more if you’re in a higher one.
Is it any wonder why the IRS promotes investing in the 401(k) by allowing the much larger tax deferral while you’re working? Remember that your 401(k) contributions only allow for postponing the income taxes due now to a later date, i.e. during your retirement. This is not a tax saving plan, it’s a tax delaying plan. We call it “kicking the can down the road”. Standard IRAs, 401(k)s, and the other tax-deferred savings plans are designed to maximize future tax revenue for the government, and you get what’s left after they “get their share”. They assume you’re not smart enough to figure this out until after you retire when it’s too late for you to do anything about it. The IRS knows that massive amounts poured into 401(k)s now means raising the most in future taxes. That’s great for the Federal government, but it’s definitely not as good for you. The ROTH provides you with tax free income, but offers no protection from stock market collapses, and probably won’t provide enough income for you to live the retirement lifestyle you are hoping for based on the much lower annual contribution maximums and income restrictions. This is all by design.
You need something more than just a ROTH or a 401(k). You need a savings vehicle that allows you to invest today the amount of money you’ll need years from now if you want to maintain your current lifestyle in retirement. You need a proven strategy that protects your retirement income from stock market collapses. If you are a business owner, you’ll want to be able to set up an IRS approved plan that allows your business to fund your personal retirement and deduct the entire amount from business revenues. You need a strategy that doesn’t require any legal paperwork to set up, and has no annoying IRS annual reporting or RMD requirements. You need a decades-old strategy that allows you to retire at any age with income that is tax free without paying early withdrawal penalties. You need a strategy that pays you this tax free income for life.
You need a strategy like ours. Just go to the Get Started page and contact us. Why not set yourself up for a better future retirement by asking us for the details today while you’re still thinking about it?
If you haven’t touched your accounts yet, all of the contributions you’ve made to standard 401(k)s and standard IRAs are subject to 100% taxation when you start withdrawals in retirement. The “Meet Robert and Frank” FAQ above explains just what persons depending on these accounts will painfully learn years from now when they stop working and hit this IRS Retirement Iceberg. When you follow a solid Tax-Free Retirement strategy in your working years, you don’t have to worry about unpleasant surprises like this.
Remember that persons of all income levels have access to this strategy whether you make $40,000 a year or $40,000,000 a year.
If you have an old or current 401(k) or IRA now, we encourage you to contact us from the Get Started page to learn how to make a “course correction” as soon as possible to convert them into a long range tax-free income plan to avoid the IRS Retirement Iceberg later.
High income professionals only qualify for ROTH IRA contributions until their income reaches $161,000 in 2024 and if their income is below the income ceiling of $161,000 their annual contributions max out at only $7,000 in 2024 ($8,000 for age 50+), while our tax-free strategy has no income ceiling or annual contribution limits. Once your income hits $161,001 the IRS prohibits you from adding another cent to a ROTH IRA unless you can do a “backdoor” IRA conversion (see the FAQ discussing this). Our plan allows you to contribute as much as you want towards your retirement because your investment amount is based on your personal retirement income goals instead of being limited by an artificially restricted IRS maximum allowable income of $161,000 and maximum annual contributions of $7,000 ($8,000 for age 50+).
Most physicians, professional athletes, and other high income individuals earn more than $161,000 annually, and many of them earn considerably more.
Plus, the longer you have until retirement the more years your investments have to experience compounded growth, and the more lifetime tax-free income you’ll have to enjoy in retirement. Additionally, our strategy protects your principal and credited gains because they are not actually at risk in the stock market. Many people have already learned the hard way that all ROTHs, 401(k)s, and Standard IRAs offer ZERO protection from stock market collapses, as your broker will admit if you just ask him or her.
Also ask them if a ROTH, a 401(k), or an IRA is structured to provide a lifetime retirement income. Unlike these investments, our strategy protects your retirement accounts from market collapses and provides lifetime income. Wouldn’t you rather have that?
First of all, a Solo 401(k) is an individual 401(k) designed for a business owner with no employees. In fact, IRS rules say you can’t contribute to a Solo 401(k) if you have any full-time employees, though you can use the plan to cover both you and your spouse. High income business owners can contribute up to $69,000 in 2024, with an additional catch-up contribution of $7,500 for those 50 or older. Once the owner retires, 100% of all contributions and account growth is taxable. Solo 401(k)s sound good on the surface, as owners can contribute and deduct $69,000 per year from their annual income ($76,500 if they are 50+), but there’s no protection from stock market collapses, and the income taxes on withdrawals at retirement will be breathtaking.
Here’s Erica’s hypothetical example: She’s a 35 year old business owner earning $350,000 per year in a 26% effective tax bracket who “contributed” the maximum 30 year average annual amount of $72,750 to a Solo 401(k) until she retired at age 65. Her total contribution amounted to about $2,182,000 over the 30 years, and she had total income tax “deductions” of about $567,000. She would realize years later that these weren’t really tax saving deductions, they were actually tax delaying deductions, and that she would be paying a heavy price for them during her retirement.
Let’s fast forward 30 years to see where this strategy “ended up”.* Since her account grew at an average of 7% per year including several stock market downturns, it had reached $4,366,000 by her age 63. Unfortunately for Erica, that same year the stock market dropped 24%, and her account lost $1,050,000. It recovered somewhat to $3,890,000 over the next two years, but at age 65 it was still down over $475,000 from its most recent high. Accumulating almost $4 million was still very impressive, and Erica was proud of the fact she’d been diligent in her savings strategy. But she learned a very expensive lesson in tax-deferral when she began withdrawals, as she fell into the same IRS Tax Trap that our friend Robert did.
When Erica stopped working and began withdrawing income from her Solo 401(k), 100% of it was taxable (including all of her “tax-deductible” contributions) since she hadn’t touched it for 30 years. Unfortunately, she learned too late they weren’t actually tax saving deductions, they were just tax delaying deductions. Erica enjoyed a great lifestyle while she was working, but her Federal income tax rate had jumped to 35% due to changes in tax legislation a couple of years before she retired. Don’t think taxes will be that high in the future? It’s already happened.
In 1980, when the Federal Debt was only $910 Billion, the marginal top income tax rate was 70%. The US national debt currently stands at $34.3 trillion, a whopping 122% of US GDP. To make matters worse, the Congressional Budget Office forecasts an additional $20 trillion or more in new debt over the next decade. Still think a 35% income tax on Erica’s Solo 401(k) account wouldn’t happen in the future? Both Federal and State governments have an insatiable need for more and more tax revenues, so don’t be surprised if history repeats itself.
Out of the roughly $4,000,000 left in her Solo 401(k), she owed a mind-numbing $1,400,000 in taxes, leaving only $2,600,000 in her account, just $418,000 more than her entire 30 years of contributions. She’d also owe another 35% of the future growth of her account. Needless to say, if her trusted advisors had told her about the damage random stock market collapses would have on her savings, and the impact income tax increases would have on her future retirement income “way back in 2024” when she was working, she could have been putting her retirement funds into a Tax-Free Income Strategy that cannot lose money when the stock market crashes and won’t be affected by any future income tax increases.
Let’s return to the present day. Since she’s the business owner, with our plan she can use an IRS approved program while she’s working that allows her business to pay for her personal tax-free retirement plan while deducting 100% of the contributions from business revenues, and as an added feature of the IRS program, her business can also cover the income taxes she’d have to pay on the business contributions without creating a negative impact to her business. This is a smart and winning strategy for both Erica and her business, not for the IRS.
If you were in Erica’s position, wouldn’t you rather have that?
Had Erica’s business directly contributed (and simultaneously deducted) the same 30 year average of $72,750 per year using the Ten Tigers Group tax-free strategy, and her account had grown at the same average of 7% per year, she could have had a massive, protected account paying her a lifetime income of over $470,000 annually starting at age 65 and all of it would be income tax-free to her for life regardless of how high the Federal and State governments raised future income taxes. Remember, it’s not how much you earn that’s important, it’s how much you keep.
So, which end result sounds better to Erica now, as little as $2,600,000 after taxes in her Solo 401(k), or a tax-free $470,000 lifetime income using our strategy? How many more vacations could Erica take, or how many extra things could she buy, or how many more family members could she help, if she incorporates the tax-free retirement strategy from Ten Tigers Group?
So, a risky and 100% taxable Solo 401(k), or a safer Tax-Free Retirement Strategy through the Ten Tigers Group. Which one makes the most sense for you?
*Note: The values and growth rates presented here are simply a fictional example of what could happen to Erica’s two accounts in the future if she contributed the maximum allowable into a Solo 401(k) or our Tax-Free Retirement plan starting in 2024. In her case, the contribution was about 20% of her annual income. Informed people understand the need to invest 10% to 15% of their gross income each year if they have many years before retirement, or realize they may need to invest more if they want to retire in less than 30 years or want more income. This is a hypothetical illustration of two different ways to save for retirement, not a guarantee of any actual account values or Erica’s income tax bracket when she retires.
If your employer offers this retirement savings option, ROTH 401(k)s have the same $23,000 maximum yearly contributions as regular 401(k)s. Just know that the combined total of your 401(k) and ROTH 401(k) contributions is limited to $23,000. The first difference you’ll notice is that this is after-tax money, not the pre-tax contributions you make with regular 401(k)s. These can be good plans if a person doesn’t mind the frequent stock market downsides and the obtrusive IRS controls. After all it’s another government sponsored plan, so for your own good, before you decide on this one you need to know both sides of the story.
If you are a business owner, unlike the Tax-Free Strategy we offer, contributions are not tax deductible if the business funds them. With our plan, they are, regardless of the amount your business contributes to your retirement on your behalf.
Next, like any Standard IRA, ROTH IRA, or Standard 401(k), ROTH 401(k)s are fully exposed to stock market collapses where investors have no downside protection at all. You don’t want all of your money in any of these plans unless you have an extremely high tolerance for an uncertain future that you cannot control.
What if your ROTH 401(k) drops by 53% just before or just after you retire like the stock market did from October 2007 to March 2009 when the DOW dropped off a cliff from 14,165 to 6,594 in a mind-numbing 18 months? Would you have to go back to work?
For a ROTH 401(k), ROTH IRA, standard IRA, standard broker account, or a standard 401(k) to recover from a 53% loss like this, your accounts would have to grow at least 10% per year for more than seven consecutive years to recover. Would you be willing to wait that long just to get your money back to where it was before? Could history repeat itself? Of course it could! The stock market goes through collapses ( aka “corrections” or “resets” ) like this about every seven years. If this happens again during your retirement, could you live on half of the income you were expecting on the day you retired? How many years would it take for your lifestyle to recover? With our Tax-Free Strategy, these horrific events can’t happen because your principal and locked-in gains are never actually at risk of loss in the stock market.
Withdrawals are income tax free, but the amounts are not guaranteed to last for your lifetime.
When funding a ROTH 401(k), the account must remain untouched for at least 5 years, and no withdrawals of account growth are permitted before age 59 1/2.
So, a ROTH 401(k) sounds good until you compare it to a strategy like ours with zero risk of loss and none of the annoying IRS rules and regulations. With our tax-free income strategy, clients can contribute as much after-tax money as they wish, and they can withdraw it at any age without early withdrawal penalties.
Aside from the fact that all IRAs and all 401(k)s have absolutely no downside protection when the stock market experiences another one of its periodic collapses, starting in 2024 professionals earning more than $161,000 do not qualify for additional ROTH IRA contributions of the $7,000 maximum per year, or $8,000 per year if a person is over age 50. Has anyone ever shown you the amount of tax-free income you could expect from a ROTH IRA after contributing the maximum for 20 or 30 years? Would this be enough to maintain your current lifestyle?
What if your IRAs, 401(k)s, ROTH IRA, or ROTH 401(k) dropped by 53% just after you retired like the market did from October 2007 to March 2009 when the DOW dropped from 14,165 to 6,594 in a mind-numbing 18 months? If this happens again, could you live on half of the income you were expecting on the day you retired? ROTH IRAs and ROTH 401(k)s are great concepts, but individuals earning more than $161,000 per year are prohibited by the IRS from contributing more after-tax money to their ROTH IRA beginning in 2024 unless they can do a “backdoor” IRA transfer (check out the “backdoor IRA” FAQ for details. As it is, annual contributions are limited to only $7,000 per year ($8,000 per year for age 50+). High income people with access to a ROTH 401(k) need to put away a lot more than that if they want the same lifestyle in retirement. With our plan, you can invest as much after-tax money as you want, and there’s no danger of your account value dropping 53% in less than 2 years.
“I’ve been using the same advisors for years, so I’ll just ask one of them to handle this, even though they’ve never mentioned a tax-free retirement income strategy like this to me. I’m concerned that my IRAs, both of my ROTHs, and my 401(k)s have all lost money in previous down markets, and no one has ever suggested ways I can protect my investments from future financial meltdowns once I retire and have no time to recover. I wonder why not?”
One possible explanation is that fee-based financial advisors can’t charge you management fees for money that is no longer under management with them. Another possibility is that, unlike our tax-free strategy, they just don’t know of a guaranteed way to protect your investments from any future stock market collapses. To find out, you could just ask them what protections they have put in place to prevent your accounts from losing money every time the stock market tanks. Good luck getting a straight answer on this one.
Would you expect just one single doctor to handle cardiology, oncology, dermatology, neurology, psychology, and all the other medical specialties? Would you ask a dermatologist to perform your by-pass heart surgery? Of course not! Each area requires a medical specialist with years of training and experience to be sure your end result is optimal. Similarly, expecting a single advisor to be an expert in everything related to your retirement is just not being realistic.
Our partners are financial specialists in tax-free retirement strategies and estate planning and as a group we have over 283 combined years of real-world experience along with the knowledge it takes to provide you with the best income-tax-free retirement outcomes. Financial advisors usually charge management fees to handle your accounts, even when they lose money as in a recent Fidelity article that showed the average 401(k) lost 23% in 2022. Our strategy has no managed money fees, and not a single client of ours lost money in 2022 when using this strategy.
Just as it makes sense to have more than one doctor to diagnose and resolve specific health challenges a person may experience, doesn’t it make sense to have more than one financial advisor, especially one who specializes in income tax-free retirement strategies that are structured to prevent stock market losses like this? If your current advisors have never mentioned a safe, tax-free lifetime income strategy like this to you, I’d ask them why not, and then contact us.
Sometimes it makes sense to do a “backdoor” contribution to a ROTH IRA whereby a person can transfer the net proceeds from a standard IRA into a ROTH IRA once they’ve paid the income taxes on the original IRA. There’s no limit to the amount converted.
Like any other IRA, however, ROTH IRAs are 100% exposed to regular stock market declines and collapses like the 53% drop in market values from 2009 to 2011 or the 23% drop in 2022. You don’t have to subject your retirement accounts to these risks. If you want to protect your money from gut-wrenching collapses like this, it makes more sense to do a “backdoor” IRA conversion into our income-tax-free plan instead where your account cannot lose money no matter what the stock market does either before or during your retirement.
Before a person does a “backdoor” ROTH IRA conversion, we recommend IRA holders do two things first: speak with their CPA to determine the best way to convert their IRA(s) into after-tax dollars, and then speak with the advisory team at Ten Tigers Group to see which path makes the most sense for you.
You could choose the ROTH IRA path if you have a high tolerance for market collapses after you stop working, or you could choose our Income-Tax-Free plan that’s designed for individuals who aren’t willing to risk their retirement security to the whims of the uncaring stock market. It’s your retirement lifestyle we’re talking about, so it’s to your advantage to look at the big picture by weighing the pros and cons of each option.
A “Buy and Hold” investing strategy isn’t much of a strategy at all, as it forces you to endure the gut-wrenching anxiety of market crashes.
Following your “gut”, with no real investment plans, is a big retirement killer. Waiting to see if there’s any money left at the end of the month that you can invest is a common mistake as well. There’s never any money left at the end of the month.
You need a “pay yourself first” strategy using automatic payments from your checking account. Without a solid, automatic savings strategy, you’re opening yourself up to a whole host of problems, such as jumping on the latest get rich quick scheme, or holding onto high-flying shares or cryptos too long without taking profits while they were there, or hanging on to a stock or crypto headed in a downward spiral and you strapping in for the ride hoping it will go back up again, or selling too early in reaction to a temporary dip in price.
With our strategy, you can’t lose money because your funds aren’t exposed to the downside of the stock market. Your retirement future is on autopilot.
Not necessarily, just the money you can’t afford to lose to future stock market collapses after you stop working. If you don’t mind paying income taxes during retirement, you can just follow the herd and put your money into a standard IRA or 401(k). I don’t know of anyone who likes paying income taxes. If you do, then IRAs and 401(k)s might work for you, unless you’d prefer to have all of your money available to you at any age and without the early-withdrawal penalties and the annoying RMDs like those imposed by IRAs and 401(k)s.
Our strategy is designed to steadily grow your retirement funds without being exposed to the daily risks of losing money in the stock market. All IRAs and all 401(k)s are subject to stock market collapses, but not the strategy we are recommending. In other words, our savings strategy is risk free and management free, and you’ll have access to all of your money (not just access to your contributions as with ROTH IRAs) whenever you want it and without any early-withdrawal penalties. It won’t matter to you how high the Federal or State government raises your income taxes in the future, because your retirement income will be 100% tax-free.
Wouldn’t you rather have that?
Why hasn’t my financial advisor told me about this tax-free strategy?
Reason 1: Most financial advisors don’t know that an account like this exists, or how they work, and very few of them know how to set it up to be legally income tax-free for the account holder.
Reason 2: Most financial advisors recommend familiar financial vehicles like ROTH and Regular IRAs or 401(k)s that their company tells them to sell. Their job is to gather assets from individuals that can be put under their company’s management. They take this money and charge clients “management fees” every year whether the accounts grow or decline in value. This is their #1 business model, and they hope you never take the time to figure out what these fees actually cost you in the long run.
Reason 3: They don’t want to take a pay cut. In Regular IRAs, ROTH IRAs, and 401(k)s, advisors charge fees to “manage” your accounts, which drives up your investing cost. They can’t charge fees on money that they no longer “manage”, so they don’t tell you about other savings options like the tax-free strategy we offer.
As a result of clever financial marketing, less than one out of every 1,000 Americans has a tax free account like this, while more than 50% of the population has an IRA, or 401(k), or similar tax-deferred investment account.
With A tax-deferred 401(k) or standard IRA…..
You must pay taxes when you’re taking income or making withdrawals in the future.
Your money (including ROTH IRAs) is not liquid, as you can’t access all of your money any time you want without penalty, and if you do a hardship withdrawal, you’re heavily penalized.
You are limited to how much you can invest since most tax deferred contribution plans have annual funding limits.
Your money is at risk 100% of the time because your 401(k) or IRA can drop dramatically whenever the market crashes. (18 times over the past 100 years)
You are required to report your withdrawals to the IRS. Everything in a 401(k), IRA, or other tax-deferred account is eventually taxed as regular income by Uncle Sam. Do you want to send a big chunk of your retirement savings to the IRS? We don’t either.
But with a Tax-Free account like ours…..
You don’t pay income taxes on growth or withdrawals, ever. This is 100% legal if your account is set up correctly by specialists like the ones at Ten Tigers Group and is structured according to the current IRS tax-code.
You can invest as much as you need to maintain your standard of living at retirement when you set your strategy up, with no income restrictions.
Historical average returns of up to 11% or more annually, net of fees and other costs.
Your Account cannot lose money. Gains are locked in when the market is up, but your account suffers NO losses when the market is down.
Your money is available to you at any time for any reason, without penalty, while 100% of your money continues to earn interest.
You are not required to report money you take out to the IRS as they don’t consider money taken out as “income”, so there’s no reporting required or income tax levied.
Is this “Too Good to be True?”
Nope. It’s very real.
In fact, this is not a new investment strategy. Accounts like these have been used by wealthy individuals and families for over 100 years to build and then pass on income tax free fortunes to their families and heirs.
Ever been to Disneyland? Did you know Walt Disney’s visionary idea almost never came to fruition? When Walt was looking for funding for his California dream park, everyone thought he was crazy and that it would never work, but he leveraged everything he owned including his personal home to make it a reality. In the end it was his tax free account that gave him the bulk of the liquidity he needed to make Disneyland a reality.
Banks like Wells Fargo, JP Morgan, and Bank of America hold more assets in these accounts than they hold in real estate.
President John F. Kennedy had an account like this. So did Presidents Taft, Cleveland, McKinley, Harding, and even FDR who held a large portion of his estate (over $7 million in today’s dollars ) inside his account.
John McCain used his account to fund much of his electoral campaign back in ’08.
The only question is…
Do you or someone in your family qualify for an account like this?
This strategy is available to anyone at any income level if they qualify for it. To find out how to qualify, contact us from the Get Started page.
Using a special IRS plan, many people-in-the-know are cashing in their IRA accounts right now, and paying their known income tax rates today on IRA liquidations rather than waiting until years from now when their future income tax rates will most likely skyrocket because of uncontrolled government spending and loss of personal deductions. Sometimes called a “Backdoor IRA”, this after-tax money can now be transferred to our Tax Free plan.
This IRS plan also eliminates the “under age 59 1/2” 10% early withdrawal penalty, which had been an issue with savers before. For individuals over age 59 1/2 the 10% penalty doesn’t apply. Now classified as “after tax” money, they can reinvest it into a Tax-Free Retirement plan like ours where all the money you withdraw in retirement will now be 100% Federal and State income tax free no matter how high the government increases future taxes. Plus, you won’t have any IRS imposed annual Required Minimum Distributions (aka RMDs).
There’s no limit to the size of your current IRA either, as all of it can be converted to the new tax-free retirement strategy if you wish. If a client has a large IRA, it can be broken down into more tax-friendly pieces to ease the income tax burden at liquidation, and if possible, to be sure the liquidated amount doesn’t adversely affect a person’s marginal income tax bracket.
Your CPA can advise the most tax-efficient way to gradually convert any large IRAs. If you have a standard IRA now, be sure to mention this when you contact us and we’ll explain just how easy it can be to convert your current IRA savings account into a plan where you’ll never be burdened with income taxes ever again. If you need a good CPA, we’ll be happy to recommend one.
If you have an old 401(k) you have the option of rolling it into an IRA. Once the money has been transferred to your new IRA, you can use the same IRS strategy to convert your after-tax dollars into our Tax-Free Income Strategy without paying any 10% early withdrawal penalties that you’d normally be saddled with if you are under the age of 59 1/2. If you are older than that, the 10% penalty isn’t an issue. Be sure to check with a CPA to be sure this is structured properly.
If you have a current 401(k) can you transfer it to an IRA while you’re still employed?
Thousands of Americans wonder the same thing: “Can I transfer my 401(k) to an IRA if I’m still with my current employer?” Yes, there’s a good chance you can. While most people think about transferring their 401(k) after they leave a job, it’s actually something you might be able to do while you’re still in that job.
It’s called an In-Service Rollover
It may not have dawned on you that you might be able to roll over your 401(k) to an IRA while you’re still working for the employer that sponsors the 401(k). It’s also possible to own several retirement accounts at the same time. An In-Service Rollover lets a current employee shift some or all of their assets from a 401(k) to an IRA without taking what the IRS calls a “distribution”, which might be subject to taxes.
Not all employers allow in-service rollovers, but many do. Just ask your HR department if your company allows them. About 77% of 401(k) plans include a provision for In-Service 401(k) Rollovers. Typically, employees move money out of a 401(k) and into other retirement accounts (like IRAs) after quitting a job, losing a job, or retiring, but if your company allows it, you can do the same thing without quitting or retiring.
Why might you consider an In-Service Rollover?
When you have a 401(k), you don’t have maximum control over the types of assets you can hold, such as mutual funds, stocks, and bonds. You typically have a limited menu of options. Through an in-service rollover, transferring some or all of your 401(k) funds to a personal IRA allows you to reinvest the after-tax portion into many options, including a Tax-Free Retirement program like ours. A bonus is that you usually can keep contributing to your employer’s 401(k) after you’ve moved funds to an IRA.
Also, some 401(k) plans have excessive annual fees. If you’re stuck in one of those, many times you can minimize your costs by rolling your 401(k) money into a lower cost IRA. You might also be permitted to make tax-free withdrawals from an IRA that you wouldn’t be able to make from a 401(k).
When you contact us, be sure to let us know if you have an old 401(k) or one where you’re currently working.
None for most people. It has decades of time-proven performance, is 100% legal, and is sanctioned by the IRS.
Bottom Line
Imagine having many of the best features and benefits that a ROTH IRA or a ROTH 401(k) provides (and many more) but without the IRS contribution maximums, income ceilings, and age restrictions on withdrawals. Also there’s no risk of another catastrophic stock market collapse destroying your savings accounts before or after you retire. That’s what individuals at any income level and in any profession can expect from this strategy. Whether you earn $40,000 a year or $40,000,000 a year, most people can take full advantage of this amazing retirement vehicle.
With this strategy, the earlier a person starts and the more money they invest every month, the more Tax-Free Income or Tax-Free Loans they can access at any age while they’re still young enough to enjoy it. Individuals can invest as much as they want every month right now for maximum income and the lifestyle they really want at retirement.
Wouldn’t it be a shame if a better retirement plan than a ROTH, or an IRA or a 401(k) existed, but you didn’t find out about it until it was too late?
Most importantly, to learn if a Tax-Free Strategy like ours makes sense for you, just submit the Get Started request form.
No, it is not. It is actually an important part of your overall strategy. Estate planning is important to consider for anyone who has assets they want to protect and pass on to their loved ones while keeping the legal system out of the process. An Estate Plan is just advance planning for the inevitable day when we graduate from this life. Estate Plans ease the burden of our passing on those we love and care about as they are designed to benefit our spouse, children, grandchildren, other loved ones or friends, or charitable causes near and dear to us, and ensures our assets and affairs are managed as we desire.
What happens if you do nothing?
When we die, there is a legal process in place to settle our estate called Probate. It manages, settles, and distributes property and assets according to the terms of a Will. If we die without a Will, the court imposes their will on our loved ones. Items that are subject to probate are known as probate assets. These assets generally consist of any property we own at the time of our deaths that we want to seamlessly pass on to our beneficiaries, and among these are businesses, investment accounts, personal property, and real estate. Probate is expensive, can take years to settle, is a very public process, and the state makes all the decisions. Most people don’t want the government to decide how their assets are divided up. But if you do nothing beforehand to eliminate probate, this is exactly what happens.
The key to avoiding Probate is to establish a Living Trust
A Living Trust is an entity created for avoiding probate while transferring assets to beneficiaries. A Living Trust provides the required signature for transferring assets by putting someone in place, a successor trustee, to sign for assets when our signature is no longer available. A Living Trust locks up your assets with you in control of the key. You then give that key to someone of your choosing, your successor trustee, to unlock and distribute your assets to your beneficiaries without having to involve the court. It’s just that simple: low cost, high return, minimal confusion, and no unnecessary delays.
Ten Tigers Group has arranged special Estate Plan pricing for a fraction of the cost our clients would normally pay for such a valuable service.
A complete Estate Plan from our group includes the following:
a Revocable Living Trust a Certification of Trust
a Declaration of Trust a Pour over Will
a Durable Power of Attorney a Nomination of Guardian
a Health Care Directive a Living Will
a Final Disposition the Funding Instructions
the Assignment Letters the Final Instructions
a Complete Summary
Estate planning is something anyone with assets should put into place for their loved ones long before it is actually needed. If you are interested in learning more, go to the Get Started page and contact us.
The income tax examples used in the above FAQs are hypothetical and do not represent actual tax advice. IRA and 401(k) conversions might affect your individual income tax bracket and we strongly recommend consulting with your CPA to determine the best ways for you to convert any tax-deferred IRAs, old 401(k)s, or current 401(k)s to the suggested Tax-Free Retirement strategy we discuss on this website. All income tax rates used in the FAQ examples are hypothetical and are used to simply illustrate what could happen whether tax rates stay the same or increase in the future.