CASH AS AN ASSET CLASS          

                                                 

         Having just celebrated our nation's 240th birthday -  Let’s ask George Washington, “is there a difference between ‘tax avoidance’ and ‘tax evasion’?" The answer is YES, and it is a very big difference in fact. Knowing about and using the allowable tax codes to provide tax-free income is not a crime – it’s a brilliant!

               Building a cash reserve that can be used to pay taxes on qualified withdrawals, pay off a mortgage or simply offset market downturns is a key element to retirement planning but most folks just don't do it.  They stuff every cent they can into a 401k or IRA plan thinking it is saving them money.  The horrible truth is that they are literally mortgaging their retirement because Uncle Sam will, in fact, ask for much - if not most, -  of that money back when you need it the most.  

  Savvy investors use different kinds of investments to satisfy different financial needs. Relying only on stocks & bonds, and only a small amount of cash puts you at a disadvantage.  Due to an unprecedented and extended low interest rate environment and overall market volatility the old “4% Rule” has been adjusted down to a new “2.8%” to maintain a portfolio over a 30- year retirement.  That means even if you can save a million dollars for retirement you can only afford to withdraw $28,000 per year if you expect that money to last over 30 years.  What if you could bump that up to 5% or 6% without risk?   Would that change your lifestyle?

By using a combination of properly-structured financial instruments, a synergistic effect can be created that could minimize exposure to market risk, assure the continuation of tax-efficient income, significantly increase the after-tax amount received from Social Security and much more.  Bottom line is more spendable income.    

If your goal is to be one of the small percent of Americans who can retire at the same or similar pre-retirement lifestyle level, it will take more than “ordinary” planning. Putting one great idea into action today could change the way you eat, play and live in your golden years.  

Stay Wealthy!