By the way, how much of a pay cut do you want to take when YOU retire? Experts say we’ll need about 80% of our peak income to live comfortably. Let’s imagine someone caps out at $100,000—they would need around $80,000 to live on annually in retirement. How will they get to that amount? Let’s say Social Security pays you $40,000. The average 60-69 year old has around $200,000 in their 401(k).* A 5% income from that would give you $10,000 of income which gets you to just $50,000 per year—less than twothirds of what you’d need. Where will you come up with the other $30,000 per year—and what happens when your 401(k) runs out? Regardless of your situation, these are big questions that we can help you tackle at WealthWave. Think of it like this: If your retirement was a plane, it’d be like trying to take off with only one wing. Or worse, can you imagine being on a plane in mid flight at 30,000 feet, you look out the window see a wing break off? Running out of money in the middle of retirement could create that same level of panic—and millions of Americans are facing that harsh reality. - - * “The Average 401(k) Balance by Age,” NerdWallet, Sep 2020

There are three ways your money can be taxed. TAXED NOW, like with a CD. TAXED LATER, like with a 401(k) or regular IRA. Or positioned so the earnings and income are NEVER TAXED. Which would you prefer? Think of it this way. Imagine you’re a farmer. Would you want to be taxed on a couple of bags of seed or the entire harvest you grow from those seeds? Remember Zoey? At 9%, her inheritance of $10,000 grew to $640,000. Then let’s say she retires and uses 5% of the $640,000 each year for income. That would be $32,000 per year. If she lives 31 years in retirement that could potentially add up to $1 million in income. So would you rather pay taxes on the initial $10,000 deposit or on the $1.6 million of potential growth and income? That’s an easy decision, right? When it comes to how we’re taxed, it’s essential that we think ahead and then create a TAX NEVER strategy. Do you have one of these in your portfolio?

Alright, so now I’m going to take a minute and share the two most popular strategies we use to help our clients put the other wing on their retirement plane—and make sure it stays on for the rest of their lives. The first one has a very specific and advantageous set of features and fits in the TAXED NEVER category. We call it the “Tax-Never Income Strategy” or “TenNIS” for short. With this strategy, your money has the potential to grow TAX-FREE, but when the market drops you don’t lose a dime—it’s completely protected from losses. It can also provide a TAX-FREE income. I don’t know about you, but it sure seems likely that taxes could go up over time and it will be nice to have TAX-FREE income in retirement. It also provides creditor protection in some states, and leaves a TAX-FREE legacy for your family. As you can imagine, many people who see this strategy want one for themselves. Ask your WealthWave professional to see if a TenNIS strategy is suitable for you.

So now it’s time to answer the BIG question for YOU… Will you have enough money, AND is it in the most TAX-EFFICIENT place possible? The best way to find out is to set aside a few minutes to get with a licensed WealthWave professional. Ask them about the RISe and the TenNIS strategies—to create a TAXED NEVER income to afford the retirement lifestyle you want, as well as a RELIABLE income to make sure you don’t outlive your money. As we wrap up here, let me finish with just two questions: 1. Based on what you just saw: What intrigued you the most? 2. Would you be opposed to meeting for a few minutes to see if you can benefit? Few things are more important than learning how to put your money to work for you in a significant and tax-efficient way so you can secure your family’s future. I strongly encourage you to contact your WealthWave professional now and find a time to get together. Thanks and have a great day!!

The Big Question

Justin Yap

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