1 million dollars can pay out a hundred thousand dollars a year in
tax-free income. In this educational episode,
i'm going to address the question that I've been asked numerous times.
"How to invest 1 million dollars for retirement?" Well, it assumes you have
a million bucks and now you want to know what is the best place to put that money
so you do not outlive your retirement. So, get ready.
I'm going to show you absolutely the best place to invest a million dollars
if it were me. And I've advised thousands of people on how to
generate 10% payouts on a million bucks. That's 100 grand a year of
So, I'm Doug Andrew. I'm here in my radio studio. I produce a weekly radio show.
I've been doing this for 12 years. And in a one hour radio show,
that's divided up into 4 segments. I usually answer a specific
question that people have asked anywhere from 30 to 300 or more times
a month for the last several months. This question here has been
asked thousands of times in my 46 year career
of being a financial strategist. So, let me tell you a little story.
And actually i could tell you dozens like this one.
But I had an individual come to me that had
a million dollar settlement. They got a million bucks
from I can't even remember whether the settlement came from a lawsuit or a car
accident or whatever. And they said, "Doug, I have a million
dollars. Now, I want to make absolutely sure
that i do not lose this million." Well, I knew immediately i would never
recommend you put that in the market. Okay? Because i've seen people with a
million dollars one day and a year later they only had 600,000 to
show for it. That happened in 2008. So,
no you don't wanna put them in the market. See,
money in the market is designed to keep it there.
When you ask Wall Street, when is the best time to take money out of the
market, they will always say, "Never." When the market dives, they say,
"Hang in there. Hang in there." The market always comes
back. It was never designed to provide safe growth and tax-free income.
Most of the people that came to me wanted to preserve
their principle. They wanted to have safety of that principle.
So, this gentleman I said, "Well, I would recommend
wherever we put this, it passes the laser test." He goes, "What's the laser test?" I go,
"Well, it's an acronym that stands for liquid assets safely earning returns."
But laser is the order of priority on prudent investing. Wherever I
recommend people put money serious cash that they don't want
to jeopardize like you just told me, you want to make sure it's liquid, number
1. See, people get these in reverse order.
Liquidity is number one. The ability to access the money when you need it.
With an electronic funds, transfer phone call. He goes, "That sounds good to me."
Number 2, safety. He said, "Safety of the institution?" I said, "Yeah, I put my
money in the institutions that have whether
the great depression with flying colors. The las industry that would collapse
if the american dollar became worthless." "What industry is that?", he asked. And I
said, "Well, the multi-trillion dollar insurance industry. It's the backbone of
America, the backbone of the world. It's where governments go to for help
and money when they need it when they're hard up.
It's where banks and credit unions take the money we deposit into them.
And they take 30 to 40 percent of their tier one assets
for liquidity and safety. And they put that money there
into insurance companies. It's called BOLI,
bank owned life insurance." It's an acronym, B-O-L-I. And so, they borrow our
money at 1 or 2 percent. And they turn around and increase the
safety by 6 notches higher. Because most of these insurance
companies are rated triple A that I put my money into.
Most banks are only rated triple b. That's 6 notches
lower in safety. They increase the safety on the money you you gave them and then
they increase the rate of return. They're paying you 1 or 2 percent.
And they're earning 5 or 6 percent in the insurance company.
Because they don't even link it to an index. They can link to an index and earn
8, 9 or 10 percent if they want. So, I'm saying, "Why don't you do what
banks do? Bypass the middleman with this." And so you have liquidity, number 1.
Safety, number 2." Then I told him, "Number 3, you want to
earn predictable rates of return. Not pie-in-the sky rates of return. You
don't need 15, 20, 30. There will be some years you
might earn that. But you want to not lose when the market
goes down. You may not make much during a recession or a down year. But
you will make money when the market goes up and would an average return,
sir of 10 net sound good?" "That sounds too good to be true", he said.
I said, "Well, it's not. I have actually averaged
10.07% net after all costs and fees of a max
funded insurance contract for over 25 years." He goes, "Wow,
this sounds too good to be true." Well, I did an illustration.
Long-story-short, we took the million dollars. Now, there were some other assets.
He goes, "Can I put this money there too?" But let's just isolate the milion.
That million dollar strategically funded an insurance contract, a laser fund in
4 years and one day in compliance with IRS
tax citations Tefra, Defra and Tamra. I don't have time in this episode to
explain those. You can search those on my channel and you can watch videos
that explain those tax citations. When you comply with those tax citations,
under three sections of the internal revenue code, section
72 E, 7702, and 101 A, that million dollars accumulates
tax-free the rest of his life. When he takes
income anytime it's tax-free. And when he dies, that million blossoms
to about 2.5 million totally tax
free. No other vehicle does that. He goes, "Wait a minute,
you mean my million, if I don't touch it will double to 2 million and about
7 to 7 and a half years?" I go, "Yup." "What if i leave it another 7 and a
half? Will it grow by another million?" I go,
"No. It will double from 2 million to 4 million."
It doubles. 4 million will double to 8 million. It keeps doubling.
It just doesn't grow by another million every 7.2 years. It
doubles. 1 million to 2 million to 4 million to 8 million to 16 million.
Many of my clients have done that. He goes, "Whoa!
That's incredible. What if i need income?" "Well, if you need income when it only has
a million in it, it can generate 10%. Take 10%,
that's 100 grand a year. "Without depleting principal?" If you're
earning 10 and you only pull out 10, you're not
depleting the principal. "Can i start it when there's 2 million
in there?" Sure, well how much would that be? 10% of two million is what?
He goes, "200,000?" Yeah, you doubled your income.
When it's worth 4 million, it can generate 400,000 a year
of tax-free income. He goes, "This is incredible.
What else can I put in this? Where I have some other money?" But see it all started
with "What am I going to do with this lump sum?
My banker tells me to put it in the bank
where it's safe." When I told him, "Guess where his bank is
putting the money?" He goes, "How come they didn't tell me that?"
The bank said, "Well, here we don't charge fees."
Oh, yes, they do. They're hidden. They don't call them fees.
They take your money and they earn 5, 6, 7, 8 percent. What does it
cost you to put your money in the bank? 7% on a million is costing
you 70 grand. They don't charge you 70,000.
They just pay you a nominal interest rate of 1 which is
costing you 70 or 80 thousand of what you otherwise could
earn in a laser fund, in an institution
rank 6 notches higher in safety where your bank put some of your money if you
choose to put it there. He goes, "How come nobody ever told me
this before?" Well... So, he was grateful. I hope this has
given you some insights into opportunities that you
didn't know existed before. So, you can extrapolate from my example.
Whether you have 2 million, 10 million, a half a million or a $100,000,
you can take a lump sum and grandfather
yourself to accumulate from that point forward
your money tax-free, access the money tax free,
be able to take a ten percent payout and not deplete
your nest egg. I'm going to share with you how you can learn more about this.
So, if what I've been sharing intrigues you,
you need a copy of my most recent best-selling book
but you don't need to buy it. It retails for 20 bucks
on amazon. It's called the laser fund. And this is how to diversify and create the
foundation for a tax-free retirement. It's a 300-page book. 200 pages
are full of charts and graphs and explanations. If you learn more by
stories, you flip the book over and you read this side. This is 12
chapters containing 62 actual client stories. I recommend you
use your right brain and left brain and learn by the stories as
well as the examples in here. And so, I will pay for the book. I will
send one out to you as a gift. You can claim a free copy by going to
laserfund.com, L-A-S-E-R, fund, ".com". And you pay $5.95 shipping and handling.
I'll pay for the book, you pay for the shipping.
There's options there to get the audio version also. And also
video courses if this intrigues you. But many people who get this book
send me thank you notes and they say, "Doug,
you just made me an extra million bucks. You just empowered me to have 100,000
a year of tax-free income compared
to the bank or my advisor only showing 4% returns instead of 10%."
Pretty significant. Wouldn't you agree?