“I would blow up the system and restart with something totally different.”
- Ted Benna, “father” of the 401(k), as told to MarketWatch.com
As investors start to educate themselves about investing, many begin to realize that their 401(k) might not all they thought it was cracked up to be. After all, even Ted Benna, the man who popularized the tax loophole that became the 401(k) program, has all but disowned it.
But should you liquidate your 401(k)? It’s not an easy decision, and there are drawbacks as well as benefits.
The Pros and Cons of Liquidating a 401(k) Early
There are good reasons to liquidate your 401(k) (or perhaps just put future savings and investments dollars elsewhere):
- Highly restricted investment choices.
- Legitimate fears that income taxes are on the rise.
- Layers of never-ending and often hidden fees that drain “your” asset.
- Limited access to dollars for limited reasons.
- The fact that any dollars borrowed from 401(k) have gone into the account “tax deferred” but must be replaced with “after tax” dollars… that are taxed AGAIN upon withdrawal.
- Lack of control over qualified accounts ruled by government decisions and policies.
In spite of compelling reasons to liquidate a 401(k), there are also important considerations and good reasons why you may NOT want to liquidate your 401(k) – or not right now. Before considering such a move, be well aware of the following: Continue reading
“You’re not getting old; you’re getting ready.”
-Ernestine Shepherd, the world’s oldest female competitive body builder.
It’s a Fact: Americans Are Living Longer
According to the CDC (Centers for Disease Control and Prevention), life expectancy in the U.S. now stands at 78.7 years.
Women continue to outlive men, with life expectancy being 76.3 years for males, and 81.1 years for females. Life expectancy varies according to race and ethnicity. It is highest for Hispanics, for both males and females, and lower for African Americans than for whites or Hispanics.
But don’t plug those numbers into a retirement calculator! It is mistake to assume that 78.7 years (give or take for gender and ethnicity) is YOUR life expectancy. Chances are, you’ll live much longer than you think you will, as we’ll explain. Continue reading
“I bought a new life insurance policy but the small print is impossible to understand. All I´m sure of is that after I die, I can stop paying.”
Do You Want to Stop Paying Your Life Insurance Premiums?
What happens when a policy has been started but the policyholder or payor doesn’t want to keep paying the premiums? Or when they can’t afford the premiums any longer?
If payments are stopped, they could lose the policy, just as a homeowner will go into foreclosure if they stop making mortgage payments before the home is “paid up.”
But there are other options to simply letting a policy lapse! These options are well-worth considering, especially because: Continue reading
Posted in CASH VALUE INSURANCE, FAMILY and FINANCES, INSURANCE ADVICE, INSURANCE AS AN ASSET, LIFE SETTLEMENTS, ORGANIZING YOUR FINANCES, WHOLE LIFE INSURANCE, WILLS and ESTATE PLANNING
Tagged can't afford premium, life insurance policy, save a policy, stop making life insurance payments
“This book is so spot on… Truly a must read!”
– Amazon review for Busting the Retirement Lies
Kim Butler’s Personal Finance Books on Audio
Busting the Retirement Lies is practical book for anyone open to re-thinking “retirement.” Perhaps you’re 50+ and feel panicked and “not ready” to retire, financially or otherwise. You could be any age and curious if your 401(k) will really work the miracles you hope it will. Or you might be almost-retired – or newly retired – and wondering what to do with yourself.
Get ready to reconsider everything you thought you knew about retirement and retirement planning in this uplifting yet highly practical book. From number-crunching to inspirational stories of role models of those who have busted the myths of aging, you’ll find yourself opening to new possibilities about what it means to “live long and prosper.”
Not only is Busting the Retirement Lies now available on Audible.com, but our book trailer is also out (trailers aren’t just for movies anymore!): Continue reading
“Financial planning doesn’t work.”
- Kim D. H. Butler, author of Busting the Financial Planning Lies
Financial Anxiety, Anyone?
Feeling nervous about where the stock market might be headed after its recent climb?
Nervous about where taxes might be going?
How about what might happen with Social Security? Or the economy, interest rates, the stability of our banking system and inflation?
You’re not alone.
Anybody who is paying attention can’t help but observe the similarities between today’s economic and market conditions and those preceding the Financial Crisis of 2007 – 2009. Last month Market Watch declared we are in Continue reading
“I want my money to be like a river, not like a pond.”
- Lisa Sasevich, Inc. 500 business owner
We said in our last article, we’re tired of “investing” being equated with the stock market/ mutual funds! Wall Street is NOT the only option!
We’re equally tired of “wealth” being equated with ACCUMULATION. Accumulation does NOT equal wealth and prosperity!
Financial planning teaches us to “Accumulate first, then Disburse.” Save and invest to accumulate ample assets – generally in a 401(k) and other assets based largely in stocks and mutual funds. Then someday, when you accumulate “enough” money in your accounts, you can stop working, begin the distribution phase, and live off of your assets (or the interest your assets produce.) Continue reading
“This might be the best investment you’ve never heard of.”
- Kevin Nichols, private equity fund manager
Are You an Investor Seeking Stock Market Alternatives?
We think that people are tired of the word “investment” meaning only the stock market. In broker-dealer circles, even “alternative” investments often refers to products within the mutual fund world, such as REITs (Real Estate Investment Trusts that are securities, not property) or mutual funds that invest in precious metals.
By contrast, life insurance is an entirely different beast, based on actuarial math rather than the rising and falling of stocks, funds, and indexes (though NOT classified as an “investment.”) However, there is a life-insurance based investment that has been gaining popularity with many corporate and sophisticated investors: life settlements.