Retirement Planning

The Power of Tax-Deferred Growth
If you could increase the return on your investment without taking on additional market risk, would you? Of course you would! The question is how, right?

That´s exactly what happens when you invest in accounts that defer tax withholdings until the time of withdrawal.

For example, when you pay taxes at the rate of 25% on your annual gains, it reduces the amount of money in your account that could be earning valuable interest. With tax deferral you would delay paying those taxes, leaving the money inside the account. Because there is more money available in the account to earn interest, your account balance may grow and increase faster than without tax deferral.

As the hypothetical chart below shows, over the 20-year period, a $100,000 investment, earning 4% tax-deferred returns, will grow to $219,112 over 20 years. That´s $43,000 more in earnings.

This chart is hypothetical and for illustrative purposes only. The hypothetical 4% rate of return shown is not guaranteed and should not be viewed ad indicative of the past or future performance of any particular investment.

Many People Will Spend More Time In Pre-Retirement – Planning Ahead for Their Future Retirement – Than In Retirement. Many people we work with are more concerned about keeping what they have and making it last, than the best stock pick of the month.

That’s why resourceful baby boomers and retirees are turning to research, financial coaches, and investment advisors for the information they need to review their portfolios and address the questions:

“What kind of pre-retirement planning do I require, now, for a successful transition to life after work?”
“What can I do now to help protect my life savings from the uncertainty of our economy and global markets?”

Pre-retirees and retirees who have a written financial plan before they receive the Gold Watch, may be better off than those who do not. Seek the advice from a trained professional like an Investment Advisor Representative at TradeWell™. We are Fiduciaries and are legally obligated to hold your interests ahead of ours.

Know What Plan Fees You Are Paying For Your Retirement

AARP estimates that hidden 401(k) fees of 1% can reduce a worker’s retirement returns by about 15% over 30 years. For an account of $1 million that comes to $150,000.*

Twenty years ago, the cost of administering a 401(k) plan was primarily the responsibility of the employer. Today most of that burden has shifted to participants. According to a recent article in AARP, “Although workers have not been receiving itemized bills for fees they pay in their 401(k) retirement plans, those hidden costs may be chipping away at the growth of their nest eggs.” Most if not all 401(k) participants are also shouldering the burden of managing these accounts themselves, or relying on a call center representative for investment advice.

* Sourced from: http://www.cnn.com/2012/06/27/opinion/hiltonsmith-retirement-savings


Mike Albertson is an Investment Adviser Representative. Advisory services offered through Secure Asset Management, LLC (SAM) a Registered Investment Adviser.

Securities are offered through Aurora Securities, Inc. (ASI) Member: FINRA/SIPC.

Tradewell Tax and Financial is not an affiliated company of (SAM) or (ASI).

Representatives of Tradewell Tax and Financial are authorized in states where they are properly registered. Mike Albertson: FL, IN, KY, OH, SC. Clients who are not residents of these states cannot be serviced.

This website is not intended to provide investment, legal, or tax advice, nor to effect securities transactions or to render personal advice for compensation. Tradewell Tax & Financial is not engaged in the practice of law. All insurance recommendations offered through Indiana Tax Advisory Group, Inc. Mike Albertson is President of Indiana Tax Advisory Group, Inc.

There are no assurances that you will achieve your investment objectives. All investment strategies have the potential for profit or loss. Changes in investment strategies, economic conditions, contributions, or withdrawals may materially alter the performance of your portfolio. Past performance is no guarantee of future success. We provide no guarantee that any portfolio will match or outperform any benchmark.

Recommendations and advice are based on information provided by the client that is presumed to be accurate. The financial planning process is not stagnant and must be adjusted based upon changes in the client's personal and financial situation, liquidity needs, investment objectives, and risk tolerance. Clients are responsible for notifying us immediately if their personal and financial circumstances or goals change.