What Type of Money Do You Have?

There are four types of money. What type of money are you getting, earning, and inheriting? As always, we recommend that you contact your advisor for advisement on your particular situation.

Free Money-Best way to explain Free Money is by example. Although this example is not as popular as it once was, the best example is 401k matched-contributions. If your company still offers these contributions...maximize the match and contact your advisor.

Tax Free Money-Examples include Roth IRAs and Permanent Life Insurance.  A Roth IRA is ideal for many clients. Caps are subject to age and how much a client makes a year will determine if they can start an Roth IRA. A strategy used commonly is funding a personal Universal Life insurance policy and may minimize the tax responsibility. 

Tax Deferred Money–401k's, IRAs, Qualified Retirement Plans, & Deferred Compensation Plans. While there are restrictions and penalties on early withdrawals before 59 1/2 years of age.Contributions are pre-taxed and growth is tax-deferred, withdrawals are at a client's tax rate at that time of withdrawal. 

Taxable Money–While paying with after-taxed dollars for CDs, Mutual Funds, Stocks, you are also being taxed on the gain or income.  

There are strategies to help our clients protect themselves financially, build generational wealth, and leave a legacy. It is never too late to prepare for the future.