Summary: This week Doug Andrew discussed the following: Upcoming Free Webinar Attend our free 90-minute webinar live over the Internet Tuesday, February 19th at 11:00 a.m. pacific (12:00 p.m. mountain, 1:00 p.m. central, 2:00 p.m. eastern), and again at 6:30 p.m. pacific (7:30 mountain, 8:30 central, 9:30 eastern). The topic is "True Asset and Wealth Optimization." You'll learn how to choose the right investments for liquidity, safety, rate of return and tax benefits. Click Here to Register Now All attendees will receive $997 worth of valuable gifts, including a customized LASER Retirement Brief, The Success Formula audio program, and access to The Secrets to a Tax-Free Retirement event.. Reality Can Be Stubborn It’s revealing that there are still members of Congress who try to portray the skyrocketing national debt as anything other than a spending problem. They claim that it’s really a “paying back problem” rather that what it really is. This means that there are members of Congress who do not believe that government spending is irresponsible and out of control. It also means that our current $16 trillion debt will continue to grow and will likely top $20 trillion by the time Obama leaves office. When Congress treats the national debt as a “paying back problem” it can only mean that they are looking to extract more money from the taxpayers in order to pay that debt. This can only mean that Congress will be raising taxes. Even when Congress supposedly avoided the so-called fiscal cliff in January, nearly every working American saw their FICA taxes go up by almost 50%. The higher income earners, the employers, and those who create jobs were deliberately targeted as needing to pay more in taxes as well. The bottom line is that more people will be paying more in income taxes unless they are willing to take the necessary steps that can make them immune to tax hikes. This is not a matter of evading taxes; it is a matter of redirecting otherwise payable taxes into causes you support by utilizing longstanding sections of the IRS code. These sections of the tax code are completely legitimate and have been in place for over 100 years. They have been used for generations by the affluent as a means of accumulating their money tax-free. This, in turn, means that they will be able to provide for themselves in their golden years and not have to depend upon the government to support them. If you want to do what they have been doing successfully for many decades, you must know how to best take ownership of your future. What You Must Know About Taxable Income Those who have invested the time and effort to become educated understand that the absolute best way to avoid higher taxes, market volatility, and rising inflation is by indexing in maximum funded tax-advantaged life insurance contracts. This is the way to maintain liquid assets while safely earning predictable rates of return. Since tax reforms enacted back in 1986, there have been only three types of income that are subject to income tax on your 1040 tax return form. There is earned income that refers to wages you earn. Then there is passive income that is derived from rent or leases or the like. Finally, there is portfolio income which is the income you earn from interest, dividends, and money you pull out of IRAs or 401(k)s. That last one should get your full attention. Many people don’t realize that the money they withdraw from their tax-deferred savings vehicles like IRAs and 401(k)s is fully taxable as income. This means that they’ll be paying roughly a third of their retirement nest egg to Uncle Sam in the form of taxes, plus facing the prospect of even higher tax rates since they’ll no longer have the deductions they once had. Some folks will find themselves in a higher tax bracket than when they were working and may face an even bigger rude awakening by possibly outliving their retirement savings.
