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Could Traditional Financial Advice Be Outdated?
- 1. WealthThe Richness of LifeFINANCIAL GROUP
- 2. About Your PresenterJim Kipp Financial Strategist Kipp Wealth Management Eagle, WI 262-646-4443www.kippwealthmanagement.comwww.jim@kippwealthmanagement.com Jim KippSince 1985Over 24 Years of Experience!Milwaukee Magazine
- 3. Kipp Wealth ManagementJim KippPam KippJenni Teschendorf
- 4. What If What You Thought To Be TrueTurned Out NOT To Be TrueWhen Would You Want To Know?Especially When It Comes to Your Money & Investments!
- 5. A New Approach To Building Wealth
- 6. Could Traditional FinancialAdvice Be Out of Touch Today?Well Be In A Lower Tax BracketExcessive Risk for Higher ReturnsDiversify Large Cap, Small Cap Etc.Your Pension Is SacredMaximize Contributions To 401(k) Plans, SEP Plans & IRAsGet Your House Paid Off By Retirement
- 7. Greatest Threats To Your Wealth WealthTransfersTaxesInflationMarket Risk
- 9. Actual Income Needs Projection10 Years15 Years5 YearsNowIncome adjusted for a 3.3% estimated rate of inflation
- 10. Inflation Undermines Life and Legacy
- 11. The Mathematics of Losing Money in the MarketWhen does -40 + 66 = 0 ?
- 12. Its Easier To Lose Money Than to Make It BackBreak Even$100,000+25%-20%+66.6%$80,000+100%-40%$60,000-50%$50,000
- 13. III. Safe Strategies That May Help You
- 14. The Oracle of OmahaWarren Buffets Rules for InvestingRule #1: Never Lose MoneyRule #2: Never Forget Rule #1Source: http://www.wordpower.ws/quotations/warren-buffet-quotes.html
- 15. Asset Allocation Made Simple
- 16. Red Money vs. Green MoneyRed Money is Risk MoneyGreen Money is Safe Money Distribution YearsAccumulation YearsGreen Money is Safe Money Red Money is Risk MoneyRed Money is Risk MoneyGreen Money is Safe Money
- 17. The Rule of 100100 Age = % Red Money100 65 = 35% Red MoneyRed Money35%Red MoneyGreen Money65%Green MoneyThis is just a general guideline and individual situations vary
- 18. Upside Down PlanningRed MoneyGreen Money
- 19. Example $200,000 Age 65100-65 = 35%$ 70,000$130,000$180,000Reposition $110,000Asset Allocation in a volatile market is critical for efficient money management$20,000
- 21. Money MarketFixedIndexed AnnuitiesCDs Treasuries Fixed AnnuitiesVariable AnnuitiesREITsStock Bonds Mutual FundsDerivativesBasic Product Class OptionsLower RiskHigher RiskEvery product has plusses & minuses and a proper use in your planning!
- 22. Typical Product AllocationsSeeking Greater SafetySeeking Higher ReturnStock Bonds Mutual FundsCDs Treasuries MunicipalsCDsMarket
- 23. Three Worlds of InvestingSafety/GuaranteesRisk/MarketHybrid/IndexedFixed IndexedInsuranceAnnuitiesPersonal Protected Pension PlansBank CDs Govt. BondsInsuranceFixed AnnuitiesMutual FundsBrokerage AccountVariableAnnuitiesInsurancePrincipal is guaranteedInterest is guaranteedShort term & liquidStarts with the guarantees from the world of safetyLinks growth of the world of the stock market as an indexPrincipal is NOT guaranteedInterest is NOT guaranteedNeed TIME on your sidePotential Return: .5% to 2%Potential Return: 0% to 30%Potential Return: -40% to +40%
- 24. Who Owns Annuities?Federal Reserve Chairman Ben BernankeKeeps Personal Finance Portfolio SimpleTuesday , July 31, 2007WASHINGTON The Fed chief's largest assets last year were two annuities $1,000,000
- 25. $100,000 In Market Compared To Fixed Indexed Strategy15.0%9.85%6.40%5.12%15.0%$110,0309.85%10.03%6.40%-5.42%-9.26%5.12%-10.74%36.12%35.15%-24.0%-40.86%
- 26. Will Rogers Said ..Its not the return ON my investment that Im concerned aboutIt is the return OF my investment.Will Rogers
- 27. Income for Life StrategiesAsset Allocation
- 28. Personal Pension Lifetime Income Benefit Riders8%Positive Gain8%8%10% BonusLinked to an Index like the S&P 5008%8%Break Even$110,000Index at 1000$100,000Index at 900All income guarantees are based on the claims paying ability of the insurance company.123456Income Rider must be selected at time of application for withdrawal benefits feature, of Life Only annuitization option must be implemented by annuity contract owner. Life Only payout option may offer limited or no flexibility after implementation. Annuity contracts can provide long term streams of income payments based on the annuitants age and o f amount of premium applied to the contract.
- 29. Personal Pension Laddered Vision Income ProgramsLeg 1: Immediate Annuity @ 1.5% annuitization rate; Leg 2: Fixed interest annuity @ 4.25% guaranteed for 5 years; Leg 3: Deferred Fixed Index Annuity estimated @ 5.5% Leg 4: Deferred Fixed Index Annuity estimated 2 6%.
- 31. Will Future Tax Rates Likely BeLower?Same?3. Higher?
- 32. A Wake Up Call60 Minutes Interview 2007We are heading to a future where well have to double federal taxes or cut federal spending by 60%.Former Comptroller General: David Walkerhttp://www.youtube.com/watch?v=QxoP_9W6FC8Single Click on Link Above 8 minutes
- 33. U.S. Bailouts!$700+ Billion!$3Billion$11 Trillion
- 34. One TrillionDollarsDouble Stacked Pallets of $100 Bills
- 35. SuddenImpactAs a country, weve hit an iceberg, were taking on water, and the band plays on as if nothing has happened!
- 37. Is Postponing Tax Really The Best Idea?Your IRA, pension and 401(k) benefits will be taxable at retirement, probably at a higher tax rate.MF p.236
- 38. Whose Retirement Are You Planning Yours or Uncle Sams?$ 350,000 IRA Age 61 Over 20 Yrs RMDsYou Pay Uncle Sam $ 280,852 Total Tax Paid To Uncle Sam $ 609,120 At Your DeathUncle Sam Receives Another$ 328,268 CongratulationsYouve Become The Perfect Tax Payer!But, What About Future Taxes &Estate Taxes?Assumes Growth Rate Averaging 6% Annually IRA Balance Age 90 is $713,626
- 39. IRA/401k Tax Time Bomb! The Front 9 is where you position yourlead by building up your assets and theback 9 is where you protect your assetsfrom excessive taxationand where youwin or lose!What good is making evena 50% rate of return on an investment if, at the time of withdrawal taxes will step in to claim70, 80, or maybe even 90% of it?--Ed Slott, Americas IRA Expert The Tax Savings Time Bomb
- 40. The Four Tax BucketsRoth IRA Income Tax Free InvestmentsMaximum InsurancePlanSDLIOrdinary Assets and IncomeIRA, 401k, TSA, 403bTaxableTax-DeferredIncome Tax FreeEstate TaxableIncome Tax FreeEstate Tax FreeFor greater tax efficiency Move money further to the right
- 41. Get Your Confidential IRA Tax Recovery Analysis and Report
- 43. The Family Legacy They May Need Your Help
- 44. Wealth & Wisdom InstituteThree Basic Rules For InvestingUse the least amount of money to create the greatest amount of wealth.Guarantee that the wealth will occur & transfer tax free.Create multiples of wealth immediately using safe leverage.
- 45. Creating Generational WealthFair Market Value$350,000Couple Ages 65/64$36,800$36,800$36,800$36,800$36,800 $184,000Into BucketOver 5 Yrs.Reverse Mortgage$ 184,000(No Monthly Payments)Survivor Indexed LifeTax Friendly Tax Free Asset $ 184,000 Can ProvideTax Free Income
- 46. Emergency Fund
- 47. Vacation Fund
- 48. Education Fund
- 49. Legacy PlanningAt Death $ 609,260Tax Free to Heirs $ 184,000 To Pay Off Mortgage LeavesThem$ 425,260 Net + Sale of House$ 609,260 Death Benefit
- 50. Insurance Mortality and Expense ChargesTEFRA 1982Corridor dictates the minimum death benefit required based upon the insureds age and gender to accommodate the ultimate desired aggregate premium basis.DEFRA 1984TAMRA 1986New Cash ContributionsCompound InterestIRAs, CDs, Investments,Annuities,Home Equity7.00%Ages 66 & 64Total Premiums Allowed:$ 180,000GSPYear 5$36,000Year 4$36,000Minimum Death Benefits Required:$ 609,260_Year 3$36,000Year 2$36,0001.5%Year 1$36,000
- 51. What IfYou Could Create An AssetTax Free Growth & Tax Free Withdrawals
- 52. Has Liquidity
- 53. No Market Risk To Principal Growth S&P 500
- 55. Complete Control of Asset
- 56. Can Avoid Estate Tax Avoids Probate
- 57. Passes Tax Free To Family MembersEd SlottLife Insurance, is not only the single biggest benefit in the tax code, but it is also the most cost effective way to protect a large IRA!Life Insurance and Income for Life, a perfect Estate Plan! --Ed Slott, Americas IRA Expert
- 58. III. The Wealth Experience Method
- 59. Key Question:Is there a good step by step process through which I can make better financial decisions?
- 60. The Seven Step Retirement Checklist
- 61. Helpful Decision Making Reports 1. Take Your Wealth Index3. Receive valuable planning ideas and timetables2. Walk through our Wealth Experience Workbook
- 62. Take Your Free Wealth Index Survey NowLog On To www.wfgnetwork.com/jimkipp
- 63. Thank You!See You Soon
Editor's Notes
- #2: Welcome to our seminar. Before we start lets go through some housekeeping. First of all, you know that Im going to ask you to turn off your cell phones. You should all have a package. If you would be kind enough to take it out and make sure that you have your notes pages inside. Does anyone need a pen? By the way, if anyone needs to use the facility it is down the hall. I also want you to know that todays seminar will take about 9 hours (pause), thats right just 9 hours. If you get tired theyll bring the cots in in about 3 hours, so dont worry. Just kidding. But we will take about 90 minutes and then well have a nice meal together. By the way, if you would like to ask questions, please do. Ill probably ask you a lot of questions to. At the end of the day this seminar is for you, so the more questions you ask the better I can tailor my answers to your needs. OK. Lets get started.
- #5: Welcome to our seminar. Before we start lets go through some housekeeping. First of all, you know that Im going to ask you to turn off your cell phones. You should all have a package. If you would be kind enough to take it out and make sure that you have your notes pages inside. Does anyone need a pen? By the way, if anyone needs to use the facility it is down the hall. I also want you to know that todays seminar will take about 9 hours (pause), thats right just 9 hours. If you get tired theyll bring the cots in in about 3 hours, so dont worry. Just kidding. But we will take about 90 minutes and then well have a nice meal together. By the way, if you would like to ask questions, please do. Ill probably ask you a lot of questions to. At the end of the day this seminar is for you, so the more questions you ask the better I can tailor my answers to your needs. OK. Lets get started.
- #7: The Silent Thief. Does anyone know what it is?
- #9: The Silent Thief. Does anyone know what it is?
- #10: (Discuss Videos) Folks, prices are rising everywhere it seems. But, ask yourself this question. Are most retirees on a fixed income or a growing income. Thats right, a fixed income. So, if you need income from your IRA, inflation puts more pressure on it to perform, to not lose value to the inflation, taxes or anything else.
- #11: If your income does not increase, here are the four alternatives that you are facing (Read 際際滷)
- #29: Here is another alternative for developing a personal pension for you and your spouse. Here, the insurance companies, understanding your need for income, added another component to the FIAs we looked at earlier. It is called a Lifetime Income Rider. This benefit guarantees, no matter the performance of the underlying indexes, that your money will grow at a specified rate anywhere from 4% to 8% guaranteed. The value of this account may then be used to determine the amount of lifetime income you will receive and are guaranteed at a future date. What makes these Lifetime Income Riders appealing is that once the income stream is begun, that income is guaranteed for life, regardless of the performance of the underlying indexes. While Fixed Index Annuities typically have no out of pocket operating charges, this annuity charges a fee for the Lifetime Income Benefit Riders are usually about .45 to .5%, which comes out of the index account value. Another feature of using the Lifetime Income Benefit Rider is that although it guarantees a lifetime of income, unlike the immediate annuities we looked at earlier, you are not exchanging your principal for the income. In other words, at some point in time in the future, if you pass away, there may still be funds remaining in the annuity that could be passed as a lump sum to your beneficiaries.
- #30: Here is another option for generating income. This is called a Laddered Income Program. Let me explain how it works. Suppose you came to me and said that you had $125,000 and that you wanted income over the next 15 years but you wanted to return your of your original deposit. If that were the case, here is one possible solution where we would purchase four different annuities.So, for the first five years you would receive income in the amount of $518 per month and then, at end of the five year period, that annuity would be exhausted.When the first annuity runs out of money at the end of the first five years, we would then begin to draw income from the second annuity for the next five years. That amount of income would be $600 per month. At the end of this five year period the second annuity would be exhausted.When the second annuity runs out of money at the end of the second five year period, we would then being to draw income from the third annuity for the next five years. That amount of income would be $695 per month. At the end of this five year period the third annuity would be exhausted. Now during this fifteen year period the fourth annuity is just sitting there. At an assumed rate of growth of 6% that annuity would grow back to the original $125,000 that was deposited. You can then start the program all over again.
- #52: (Go through the list)Let me walk you through our process (read slide). When we work with our clients, we like to take a look at what we call the Seven Step Retirement Checklist.Although we only focused on a few specific topics today, the Seven Step Retirement Checklist is something we like to do with all our clients because it really helps ensure that youve got all your bases covered.
- #53: Well provide you with a number of important reports, including your Wealth Index report (show sample), well walk through what we call our Wealth Experience workbook which helps ensure you have a solid foundation, and well even provide you with some invaluable planning ideas, timetables and graphs that show you how youre doing.Let me tell you a bit more about the Wealth Index.This is a cornerstone of our planning process, and really integrates with our philosophy of tying your money into your wealth. Id really like you all to take the Index, right now if youd like, so that you can get your unique results.(Show results book. Explain why they should get the results)
- #54: Thank you for coming tonight. It was great speaking with you and I look forward to meeting with each and every one of you. And with that, lets have a great meal!
- #55: Thank you for coming tonight. It was great speaking with you and I look forward to meeting with each and every one of you. And with that, lets have a great meal!