Presentation on theme: "3/31/2017 How to Fire Your Banker, Bypass Wall Street, and Take Control of Your Own Financial Future Special Presentation by Pamela Yellen, President of."— Presentation transcript:
2Speaker Disclosure Pamela Yellen is President of Bank On Yourself 3/31/2017Speaker DisclosurePamela Yellen is President of Bank On YourselfProgramming offered by Pamela Yellen entitled “How to Fire Your Banker, Bypass Wall Street, and Take Control of Your Own Financial Future” shall exhibit fair content balance, providing the audience with information of different perspectives from which to develop an informed professional opinion.Pamela Yellen has no actual or potential conflict of interest in relation to this program.
33/31/2017The Institute for Wellness and Education is accredited by the Accreditation Council for Pharmacy Education as a provider of continuing pharmacy education. Attendees who participate in the interactive portion and submit the completed evaluation form at the conclusion of the program will have credit for 1.0 hour(s) of continuing pharmacy education (0.10 CEU(s)) uploaded to CPE Monitor within 60 days after the program date. ACPE program number is L04-P. Initial release date is 02/28/2014.
43/31/2017Learning ObjectivesAt the completion of this activity, the participant will be able to:Describe the advantages and disadvantages of various retirement plan accounts to determine which one will allow them to best reach their financial goals and objectivesExplain the three steps to becoming their own source of financing for major business and personal expensesDiscuss a plan for constructing a retirement strategy which allows them to know what their retirement account will be worth on the day they plan to tap into itIdentify the differences between “paper” wealth and “real” wealth, and provide examples of eachOutline the tax consequences of common retirement planning methods
5What Will Your Retirement Account Be Worth 3/31/2017What Will Your Retirement Account Be WorthOn the day you plan to tap into it?Would it be helpful to know?Is it even possible to know?Will tax rates go up? … or down?How long does your money need to last?
6It’s based on things you can’t predict or control 3/31/2017The Problem with Conventional PlanningIt’s based on things you can’t predict or control
73/31/2017ResultMore than half of all boomers won’t have enough money for basic living expenses in retirementFoodHeatingMedical careSource: “The National Retirement Risk Index: An Update.” Center for Retirement Research at Boston College, Oct. 2012
8Result Three in four boomers expect to postpone retirement 3/31/2017ResultThree in four boomers expect to postpone retirementHalf think they may never retireSource: 2012 AARP survey, Boomers’ “Anxiety Index” High
93/31/2017Work Till You Drop?Almost half of all retirees were forced out of work earlier than plannedLayoffsPoor healthNeed to take care of a loved oneSource: Employee Benefit Research Institute
10“After a lifetime of hard work, many seniors will find themselves forced to choose between putting food on the table and buying their medication.”—U.S. Senate Committee on Health, Education, Labor, and Pensions, July 2012
11I have enough money to live comfortably for the rest of my life … if I die by next Tuesday
123/31/2017Test Your Money IQQ: $20 stock … goes up by 40 percent—how much money did you make?A: None—unless you sold your stock and locked in your gain
13Paper wealth is meaningless when it comes to financial certainty and security
14Stock Market Facts S&P 500: Lost 49% from March 2000—October 2002 3/31/2017Stock Market FactsS&P 500:Lost 49% from March 2000—October 2002Recovered by October 2007Lost 57% from October 2007—March 2009That’s two losses of 49%+ in just one decade
15Two Losses of 49%+ Just Since the Year 2000 Are you confident there won’t be another crashin the next 5-10 years… or even tomorrow?
16Leo Cullum, The New Yorker, used with permission
17Your Retirement “Plan” Powered by Wall Street: 14 Years of the S&P 500 IndexThe S&P 500 would need to be at 2,077 in today’s depreciated dollars, just to equal its year 2000 high of 1,5272,077The S&P 500 has had only 0.95% annual growth over 14 years!March 24, 2000: S&P 500 closes at record high of 1,527February 3, 2014: S&P closes at 1,742The S&P 500 closed only 14% higher on February 3, 2014, than it did on March 24, During those 14 years, we experienced 36% inflation.Sources: Yahoo Finance, InflationData.com
18Real Life Experience The picture that’s making everyone’s jaw drop “If I can help a few people start Bank On Yourself this year instead of next year—or instead of never— it’s worth it.”Dan ProskauerVice President of Technology
21How Is This Possible? Volatility is removed Saving becomes fun You have flexibility and control, because your money isn’t locked up in a government-controlled planYour confidence is restored, so you can enjoy more of life’s luxuries
22Bank On Yourself Isn’t a Magic Pill Your plan value won’t equal your contribution in the early yearsBut because the volatility is removed, you’ll quickly see your net worth go in just one direction – UP!
23Real Life ExperienceWould you like your net worth to grow like this?
24Your Paper Wealth IS Your Real Wealth! With Bank On Yourself …Your Paper Wealth IS Your Real Wealth!
26What Is Bank On Yourself? 3/31/2017What Is Bank On Yourself?An asset that has …Increased in value …Every single year …For more than 160 yearsDividend-paying whole life insurance
27Dividend-Paying Whole Life Insurance 3/31/2017Dividend-Paying Whole Life InsuranceNot the kind Suze Orman and Dave Ramsey love to hateOptions (riders) to supercharge the growthCommissions are reduced by 50–70%Can be a powerful financial management tool from day onePlans available for people up to age 85Don’t rule yourself out due to health problems
28Provides an Unbeatable Combination 3/31/2017Provides an Unbeatable CombinationPredictability and guaranteesControlLiquiditySafetyTax Advantages
29Predictability and Guarantees 3/31/2017Predictability and GuaranteesGuaranteed GrowthCash value (money you can use now)Death benefit (money for your family and charity, later)Potential for dividendsNo luck, skill, or guesswork requiredKnow the value of your account the day you plan to tap into it …And at any point along the way
303/31/2017ControlPutting your money in a government-blessed-and- controlled retirement plan is like putting it in prisonYou don’t control the money in your 401(k) or IRA, or any similar planThe government controls your moneyThey change the rules any time they want!
31Control The prison warden has your money under lock and key 3/31/2017ControlThe prison warden has your money under lock and keyWhile your money’s in the slammer, they can arbitrarily impose any new restrictions or regulations they come up withYou have no recourse
32Who Controls Your Money in a Bank On Yourself Plan? You Do!
33You Control Your Money in a Bank On Yourself Plan 3/31/2017You Control Your Money in a Bank On Yourself PlanLife insurance policies are private, unilateral contractsThe company can’t change the rules without your consentThat’s the law
34You Control Your Money in a Bank On Yourself Plan 3/31/2017You Control Your Money in a Bank On Yourself PlanNo government-imposed limits on how much you can put inNo government restrictions or penalties for “early” withdrawal or waiting “too long”No penalties for taking “too little” each yearNo Required Minimum DistributionsRetirement income when and how you want it
35You Control Your Money in a Bank On Yourself Plan 3/31/2017You Control Your Money in a Bank On Yourself PlanYou can borrow against your cash value any time you wantNo rules requiring you to pay it back on a certain schedule
36—David Shelton, healthcare company vice president “I had very limited control of my money in my 401(k). I couldn’t put in as much as I wanted, and I needed permission to borrow my own money if necessary. Bank On Yourself gives me control over my money.”—David Shelton, healthcare company vice president
37Liquidity: Fire Your Banker 3/31/2017Liquidity: Fire Your BankerFinancing through Bank On Yourself beats financing, leasing, and even directly paying cash!You finance everything you buyEither you pay interest when you finance or leaseOr you lose interest and investment income when you pay cash
38Liquidity: Fire Your Banker 3/31/2017Liquidity: Fire Your BankerFund a Bank On Yourself plan first, then …Use the money in your policy whenever you wantFor any purpose at allSet your own repayment scheduleYour plan continues growing as though you never touched a dime of it!
39Liquidity: Fire Your Banker 3/31/2017Liquidity: Fire Your BankerThe Bank On Yourself strategy solves the problem of having to constantly interrupt the growth of your money, whenever you spend or invest it!
403/31/2017SafetyLife insurance companies are audited regularly by the state insurance commissioner’s office to ensure they maintain sufficient reserves to pay future claimsThey’re audited regularly by several independent rating companies
413/31/2017SafetyState insurance commissioner’s office can take over and run the company in the interests of policyholdersHistorically, a failed insurer’s business is taken over by another company, according to the National Organization of Life and Health Insurance Guaranty AssociationsAdditional protections are available in each state
42Extra Benefit: Asset Protection 3/31/2017Extra Benefit:Asset ProtectionMay be protected from creditors and lawsuitsRules vary from state to state
43Does having money safe and available to you take away any of your options?
44You Are Not Putting Your Money in a Straitjacket 3/31/2017You Are Not Putting Your Money in a StraitjacketYou have safety, liquidity, and controlGreater growth than savings or money market accounts, without the risk or volatility of traditional investmentsAccess to your money when and how you want—for purchases or investmentsGet continuous growth, even on the money you’re usingMore options and flexibility, not less
45Independent Pharmacy Owner Michael Bemis of Bemis Drug: “My Bank On Yourself plan gives me easy access to capital, and I’m receiving a dividend even on the money I borrowed. It works great for purchasing equipment for my pharmacy, such as a new counting machine.“Why borrow from a bank, when you can borrow from yourself?“I get to pay myself interest on the money I loan to the pharmacy for purchases, and it grows my Bank On Yourself plan.”
46Tax Advantages Of Bank On Yourself 3/31/2017Tax AdvantagesOf Bank On YourselfCan give you a retirement income with no taxes dueReduce the taxes you may have to pay on your Social Security benefitsExtra tax breaks for pharmacy owners and other business ownersDeath benefit passes to your loved ones income tax-free … and avoids probate
47Tax Advantages Of Bank On Yourself 3/31/2017Tax AdvantagesOf Bank On YourselfYou pay your taxes up front while you know what they areNo taxes due on your gains in retirement*Avoid unwelcome surprisesBoth Roth plans and Bank On Yourself plans offer that strategyBut only Bank On Yourself has all the additional advantages and guarantees we’re talking about today* Under current tax laws
48But everyone knows it’s better to defer taxes with a 401(k), IRA, etc. … Isn’t it?
49Quick Case Study You need $70,000 per year in retirement 3/31/2017Quick Case StudyYou need $70,000 per year in retirementYou retire with an average tax rate of 25%TaxDeferredPlanYou need $93,333You pay taxes ($23,333)You net $70,000Bank On Yourself Plan$70,000($ )
50How Would You Prefer to Spend That Extra $23,000 Per Year? 3/31/2017How Would You Prefer to Spend That Extra $23,000 Per Year?Paying more taxes?Enjoying life more?
513/31/2017And … if tax rates go up and you’re successful growing your nest egg in a tax-deferred plan, you’ll only end up paying higher taxes on a bigger number
52Does Your Retirement Plan … ChecklistDoes Your Retirement Plan …401(k)s and 403(b)sIRAsRoth PlansBank On Yourself PlansGive you guaranteed growth?
53Does Your Retirement Plan … ChecklistDoes Your Retirement Plan …401(k)s and 403(b)sIRAsRoth PlansBank On Yourself PlansLock in your principal and growth?
54Does Your Retirement Plan … ChecklistDoes Your Retirement Plan …401(k)s and 403(b)sIRAsRoth PlansBank On Yourself PlansGive you control of your money?
55Does Your Retirement Plan … ChecklistDoes Your Retirement Plan …401(k)s and 403(b)sIRAsRoth PlansBank On Yourself PlansGive you tax-free retirement income?
56Does Your Retirement Plan … ChecklistDoes Your Retirement Plan …401(k)s and 403(b)sIRAsRoth PlansBank On Yourself PlansLet you use your money without penalties?
57Does Your Retirement Plan … ChecklistDoes Your Retirement Plan …401(k)s and 403(b)sIRAsRoth PlansBank On Yourself PlansLet your money grow while you use it?
58Does Your Retirement Plan … ChecklistDoes Your Retirement Plan …401(k)s and 403(b)sIRAsRoth PlansBank On Yourself PlansLet you access your money without liquidating?
59Does Your Retirement Plan … ChecklistDoes Your Retirement Plan …401(k)s and 403(b)sIRAsRoth PlansBank On Yourself PlansLet you fund it every year with no government limits?
60Does Your Retirement Plan … ChecklistDoes Your Retirement Plan …401(k)s and 403(b)sIRAsRoth PlansBank On Yourself PlansFinish funding itself if you die prematurely?
61Does Your Retirement Plan … ChecklistDoes Your Retirement Plan …401(k)s and 403(b)sIRAsRoth PlansBank On Yourself PlansTell you the plan value on the day you plan to tap it?
62Does the Retirement Plan You Currently Have or Are Considering … SummaryDoes the Retirement Plan You Currently Have or Are Considering …401(k)s and 403(b)sIRAsRoth PlansBank On Yourself PlansGive you guaranteed, predictable growth?Lock in your principal and growth, even when the market crashes?Give you control of your money without government restrictions and penalties?Give you tax-free retirement income?Let you use your money in the plan without penalties, however and whenever you want?Let you use your money in the plan yet still have it grow as though you didn’t touch it?Let you access your money without liquidating your investments?Allow you to fund it every year, without limits imposed by the government?Finish funding itself if you die prematurely?Tell you the minimum guaranteed value of the plan on the day you expect to tap into it, and at any point along the way?
63As Texas Bix Bender once noted, “Just cuz you’re following a well-marked trail don’t mean whoever made it knew where they were goin’.”
64Case Study Joe and Jane Pharmacist They’re both 45 years old 3/31/2017Case StudyJoe and Jane PharmacistThey’re both 45 years oldHave $25,000 in credit card debtHave $135,000 in other personal and business debtWant a new $35,000 car every four yearsWant $100,000 for … pharmacy automation … kids’ college … or motor home
66You indicated your biggest financial concerns are: Putting $$$ into traditional retirement plans that have been going backwards for 15 yearsLack of savingsLack of liquidityCurrent and future taxesYou said your top financial goals are:Secure retirementHelp pay for kids’ collegeBuy automation for the pharmacyPharmacy renovation
67Approximately $675,692 in interest payments could leave your home over the next 10 years—never to be seen again—if you keep doing what you’ve been doing. … And you could lose more than that, if you take on additional debt.
683/31/2017Funding Joe’s PlanMoves $50,000 from money market account earning 0.2% to Bank On Yourself planCommits $2,500 monthly from current resourcesRedirects $1,000 monthly to build his personal, private Bank On Yourself plan, instead of a government-controlled planNo more premiums after age 70
69Instant life insurance coverage of $1,900,000 Liquid emergency fund of $154,000 in three yearsCredit cards paid off in one yearRetirement income of $80,000 per year from age 71 to 99 (little or no taxes due)Death benefit remaining at age 95: $660,000Total potential retirement income: $2,320,000
70No Two Bank On Yourself Plans Are Alike 3/31/2017 4:39 PMNo Two Bank On Yourself Plans Are AlikeYour plan would be custom-tailored to your unique situation and yourshort-term and long-term goals and dreams
71Top Seven Ways Pharmacists Use the Bank On Yourself Method 3/31/2017Top Seven Ways Pharmacists Use the Bank On Yourself MethodAs a safe, predictable retirement plan alternativeTo self-finance business and personal purchases, recapturing interest they’re now paying to banks and leasing companiesAs a better way to save and pay for collegeFor investment opportunities (real estate, pharmacy acquisition, etc.)
72Top Seven Ways Pharmacists Use the Bank On Yourself Method 3/31/2017Top Seven Ways Pharmacists Use the Bank On Yourself MethodTo provide safe and liquid cash reserves that earn far more than CDs and money marketsTo fund buy-sell agreements and for business succession planningTo take back control of their money and finances
73Pitfalls to Watch Out For 3/31/2017Pitfalls to Watch Out ForBeware of untrained advisors:If your plan isn’t structured properly, it could grow much more slowly, lose the tax advantages, or bothA different life insurance policy type may be recommended – No other product comes with as many guarantees as dividend- paying whole life insurance
74Pitfalls to Watch Out For 3/31/2017Pitfalls to Watch Out ForIf your current financial advisor or insurance agent tells you he knows how to implement this, ask him: “If you could have done this for me …why didn’t you?”
75Only a Handful of Life Insurance Companies Offer the Right Policies 3/31/2017Only a Handful of Life Insurance Companies Offer the Right PoliciesWhat to look for:Must offer dividend-paying whole life policiesMust have paid dividends every year for at least 100 years
76Only a Handful of Life Insurance Companies Offer the Right Policies 3/31/2017Only a Handful of Life Insurance Companies Offer the Right PoliciesWhat to look for:Must offer “non-direct recognition” policy loansMust be among the financially- strongest companies in the country (Comdex rating of at least 95)
77You Can Take Back Control of Your Financial Future! The time may never be perfect to start. – We can always find a reason to put it offThere’s an old African proverb: “The best time to plant a tree is twenty years ago.The second best time is today.”