Summary: Optimizing Assets While Minimizing Taxes Some of the biggest obstacles to your brighter future can be summed up in the acronym TIME. They are Taxes, Inflation, Market volatility and Economic Uncertainty. We need to be able to protect ourselves from the negative impact of these obstacles. Many of the audience members who Doug speaks to across the country say they feel overwhelmed when they first begin determining where they are at. Success coach Dan Sullivan likes to say that all progress begins by telling the truth. With this in mind, Doug developed an Abundant Living scorecard that helps establish where we actually stand. The principles of liquidity, safety, rate of return, and tax benefits can be remembered by the acronym LASER. It stands for Liquid Assets Safely Earning a predictable Rate of return. Let's begin with the part that includes tax benefits. To be perfectly blunt, taxes are going up and you need to understand that some people stand to lose 50% or more of their retirement nest egg to unnecessary taxes. This is primarily because most people will not be in lower tax brackets when they retire. Let's begin by scoring ourselves on a scale of 1 to 12, with a 1 being poor and a 12 being the best. Your score may be somewhat good at 3,4, or 5, or it might be better at 7,8, or 9. Be as honest as possible in scoring yourself. How Retirement Savings Vehicles Differ If you have money in taxed-as-earned CDs, savings accounts, credit union accounts, mutual funds that are not IRAs or 401(k)s, your after-tax dollars are still being taxed. This means that you're getting taxed again on the interest or dividends or any other gains you realize. If your money is taxed as you earn it, that is the worst possible way to save and you wouldn't believe how many Americans have a lot of their serious money saved in this manner. You should score yourself as a 1, 2 or 3 out of a possible 12 if this is how you're saving. If your savings are taxed as earned, you're in a poor situation for your future retirement from a tax standpoint. If you're saving for the future in a traditional IRA or 401(k), your money is accumulating tax-deferred. This means that you're putting in pre-tax dollars into a tax-deferred account because you thought that you'll be in a lower tax bracket when you retire. Trouble is, that lower tax bracket at retirement hasn't been axiomatic for nearly 25 years. If you're in that category, you should score yourself a 4, 5, or 6 on a scale of 1-12. While you're in the good category, you're barely halfway to where you could be. If you are saving your nest egg in a Roth IRA, this is a step in the right direction. Only about 9% of Americans are utilizing this method of saving. You're going to be about 33% better off saving in a tax-free Roth IRA than you would be in a tax-deferred account like a traditional IRA or 401(k). If this is where you're saving the biggest part of your retirement nest egg, you can safely score yourself at an 8 or 9 which puts you solidly into the better category. The next type of savings is totally tax-free accumulation with tax-free access when you retire and a tax-free transfer at the end of your life. You can also get deductions indirectly other ways so that you're using tax-advantaged dollars in all four phases of retirement planning. This includes the contribution phase, the accumulation phase, the distribution phase and the transfer phase. This is the best situation to be in and it can net you 50 to 100 percent more in your retirement nest egg than the poor, good, and better categories. This is where you're solidly in best territory. This is where you can score a 12 out of 12. The vehicle of choice for this kind of retirement savings is maximum-funded, tax-advantaged life insurance contracts. If learning how to enjoy tax-advantaged liquid assets safely earning a predictable rate of return (LASER) is making sense to you right now,
