About Charles Oliver. Charles Oliver Hidden Wealth Strategies

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2 Table of Contents Biography Introduction Top Marginal Tax Rates Retirement Savings Vehicles Indexed Universal Life Insurance Indexed Universal Life Insurance vs. 401(k) Step 1: Understanding Various Risks Step 2: Understanding Tax-Saving Strategies Step 3: Types of Life Insurance Step 4: Death Benefit & Overfunding Step 5: Indexing Step 6: Creating a Tax-Free Retirement Step 7: What Indexed Universal Life Insurance is NOT

3 About Charles Oliver Charles Oliver Hidden Wealth Strategies Best selling author, Charles Oliver, Founder and President of The Hidden Wealth Strategies is in the top one-half percent of all financial and insurance planners in the United States. Hidden Wealth Strategies practices a deeper relationship with a few over a shallow one with many philosophical view in serving clients concerning all aspects of wealth creation and preservation. The Hidden Wealth Strategies model gives you the time you need, an assessment of your financial status and provides you with a customized strategy for a savings and protection plan. Charles has the experience to ensure that financial safety and income potential are secured. His unique wealth building strategy continues to be used by former U.S. presidents, industry icons, banks and corporations. Charles has earned top recognition from many top-rated insurance carriers. He s a graduate of Capital University, an approved Florida CPA Instructor and educates the industry s elite about his proven wealth creation and preservation model. He s in the top half of 1% of financial planners worldwide. Charles is married with two sons, is involved in the Nations of Coaches and when he s not giving his utmost attention to you, he s giving his utmost to his family. His commitment to family speaks volumes about his character and he translates that same commitment to his profession. Charles and his team at The Hidden Wealth Strategies show you a proven blueprint for safely building, growing and protecting your wealth. Charles believes, It is never too late or too early to protect and secure your retirement.

4 Schedule Appointment Take advantage of our complimentary Tax-Free Retirement Review. Charles Oliver Hidden Wealth Strategies 2 Ways To Schedule Tax-Free Retirement Review 1 2 Call cdoliver@thehidden Wealth Solution.com

5 7 Steps To A Tax-Free Retirement Introduction When it comes to taxes and investments, we ve all heard the saying: It s not what you make, it s what you keep that counts. Since the founding fathers, investors have been on a quest searching for ways to keep as much after-tax money as possible. This is why Tax-Free Retirement has such a nice ring to it. If, like two-thirds of Americans, you re not sure you ve socked enough away for retirement, it s especially nice to know that Uncle Sam won t be pinching a slice of your meager pie. Or maybe you re an ample saver convinced by the tax talk in Washington that the feds will undo your careful planning by raising taxes just at the time you decide to call it quits and retire. No wonder Americans have taxes on their minds. This might also explain why titles of books containing the words tax-free are popping up on the personal finance shelves at bookstores everywhere. At a time when returns are extremely low and health-care expenses are high, it makes sense to preserve every last retirement dollar you can.preferably TAX-FREE. Source: CNBC. How To Invest For A Tax-Free Retirement. Jun 19,

6 7 Steps To A Tax-Free Retirement Top Marginal Tax Rates 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% Today s top federal income tax rates are substantially lower, relative to the federal income tax rates of the past century, especially for the more affluent. For most of the last century, the top-bracket income tax rates were much higher than they are today. During the 1950s and early 1960s, the top income tax rate was over 90% with the high being in 1944 of 94%. The low was in 1913, when taxes were first established. Most people paid 1% with the top marginal tax rate of just 7%. This makes today s top marginal tax rate of 39.6% seem pretty tame. In fact, today s current top marginal tax rate is the fourth lowest in US history. All odds point to higher taxes in the future, which is why a Tax-Free Retirement can be so beneficial. This leads us to the four types of Retirement Savings Vehicles available to you. 6

7 7 Steps To A Tax-Free Retirement RETIREMENT SAVINGS VEHICLES There are 4 Strategies to Save for Retirement AFTER TAX PRE TAX Personal Savings CDs / Money Market Funds Stocks Bonds Mutual Funds TAX DEFERRED Qualified Plans Traditional IRA 401(k) Tax Free Annuities Roth IRA Roth 401(k) Roth Conversions Permanent Life Insurance 7

8 7 Steps To A Tax-Free Retirement Indexed Universal Life Insurance What is Indexed Universal Life Insurance? Indexed Universal Life Insurance (IUL) is permanent life insurance that offers death benefit protection, when death occurs. Like other forms of permanent life insurance, your premium payments may earn interest and grow the cash value of your policy. What differentiates IUL from other permanent life insurance is the way interest is credited to the policy. In addition to offering a traditional declared interest rate, IUL also offers the ability to earn interest that is linked to the movement of a selected stock market index over a specific period of time. Even if the index goes down, your credited interest rate is never less than 0%. Guaranteed. The manner in which interest is credited to your IUL policy gives you the potential for strong cash value accumulation. A key benefit to remember is that it offers protection in a poorly performing market. With IUL, you don t participate directly in the stock market and the credited interest rate is never less than zero percent, guaranteed. Key Points The interest rate credited to the policy s index account value is linked to the performance of the index or indices chosen and will never be less than 0%. The premiums are not invested in any stocks, bonds, or equity investments. The index performance does not include dividends on the stocks that make up each index. The premium allocation to an Index Selection does not represent an investment in any index or market. Source: North American Company. Understanding Indexed Universal Life Insurance. Jul

9 7 Steps To A Tax-Free Retirement Index Universal Life Insurance Vs. 401(k) Guaranteed Minimum Returns (2-3%) Guaranteed Lifetime Income Tax-Free Death Benefit (Lump Sum) Critical Illness Protection Tax-Free Income After Death Disability Income Chronic Illness Protection Downside Protection Against Stock Market Loss IUL 401(k) Indexed Universal Life (IUL) would allow you to: Draw income in retirement tax-free. Receive market-like returns without any market risk. Never take a market loss. Access your money at any age. Give yourself an option to continue to make your savings contributions if you become disabled. Provide a large, income-tax-free, lump sum payment to your family, if you died prematurely. Remain protected against judgements and lawsuits (in many states). 9

10 Step 1 Understanding Various Risks Any investor, regardless of age, experience or wealth, should understand that when you invest, you re exposed to different types of risk and that you should understand how those various risks can affect your investment returns. Common Types of Investment Risk Market Risk The risk of investments declining in value because of economic developments or other events that affect the stock market. Interest Rate Risk The risk of losing money because of a change in interest rates. For example, if interest rates go up, the market value of bonds will go down. Currency Risk The risk of losing money on foreign investments because of a movement in the exchange rate. Liquidity Risk The risk of being unable to sell your investment at a fair price and get your money out when you want to. Concentration Risk The risk of loss because you are not diversified and have all of your money concentrated in one investment or type of investment. Credit Risk The risk that the government entity, or company, will run into financial difficulties and won t be able to repay the principal at maturity. Reinvestment Risk The risk of loss from reinvesting principal or income at a lower interest rate. Inflation Risk The risk of loss in your purchasing power, because the value of your investments does not keep up with inflation. Longevity Risk The risk of outliving your savings. This risk is particularly relevant for people who are retired, or nearing retirement. Male 50% chance one will live to 85 25% chance one will live to 92 Female 50% chance one will live to 88 25% chance one will live to 94 Couple 50% chance one will live to 92 25% chance one will live to Source: Annuity Mortality Table: Society of Actuaries. Figures assume a person is in good health. 10

11 Step 2 Understanding Tax-Saving Strategies When planning for retirement, many people get caught up in how much can be saved. While that number is important, the amount you will pay in taxes can be just as important, if not more so. Most of your income is subject to federal, state, Medicare, and Social Security, and possibly, local and city, taxes. This makes it even more important to be well aware of every available option when saving for retirement. The old adage It s not how much you make, but how much you keep that matters, has never been more important than today, especially when the prospects of higher taxes in the future are very real. Often times you hear people say, My 401k has over a million dollars in it, so I m in great shape for retirement. Understand, that, as impressive as that amount may seem, it hasn t felt the impact of taxes because of the tax-deferred status it carries. But Uncle Sam will get his piece of your financial pie, one day, when those funds are withdrawn. Regardless of what vehicles you use to prepare for retirement, most will be affected by tax implications, at some point. Now that you re armed with this knowledge, you can make better and more informed decisions about whether your hard earned money should be placed in a retirement savings vehicle, where your gains are taxed, your principal and gains are tax-deferred and you will be taxed down the road, or in a retirement savings vehicle where you have complete liquidity, use and control of your money that has been growing with tax-free accessibility. 11

12 Step 3 Term Life: Types of Life Insurance This provides a set death benefit at a fixed payment for a limited time frame. After that time frame, coverage at that payment is not guaranteed. To continue coverage, the client may have to agree to a different payment or different policy conditions. This type of insurance is the least expensive way to provide a large death benefit based on the amount that has been paid toward the policy. Its main goal is to provide income replacement for the beneficiary. Permanent Life Insurance: These types of life insurance, below, fall under the category of Permanent Life Insurance. They guarantee coverage for the remainder of the policy holder s life, provided the holder maintains payment of the premium. It also offers the chance to build up cash value that is tax-deferred which can generate a retirement income stream you can take advantage of for the rest of your life. Each payment made does two things. It builds cash value with tax-deferred income and it helps provide your named beneficiary with a death benefit that is income-tax-free. Whole Life: A level premium payment provides lifetime death benefit coverage, but over time the amount of the premium usually declines without any drop in the amount of the death benefit. If the policy holder has a need for a lump sum, borrowing against the policy is allowed and the principal benefit will not be affected. Variable Life: The contract owner decides to invest the cash value of the policy in a variety of separate accounts, similar to mutual funds. Indexed Universal Life: The most popular type of permanent life insurance used for tax-free retirement, due to the amount of flexibility it holds for tax-free income. It s a low risk option that also brings the potential for greater cash value growth by combining permanent insurance coverage with greater premium payment flexibility. 12

13 Step 4 Death Benefit & Overfunding Overfunding is a life insurance cash accumulation strategy that leverages the maximum allowable policy premiums, with the smallest life insurance death benefit, to achieve highest return on premium payments net of policy costs over a given time period. While the primary purpose of life insurance is providing a death benefit to the policyholder s beneficiaries, paying more premium than necessary to drive up cash value can transform a life insurance policy into a retirement savings vehicle that offers tax-free growth and an incometax-free death benefit. Once the death benefit is covered, the company creates a special area within the policy called a bucket. This is used to allow the owner of the policy to overfund the policy and create a larger sum of money within the policy that can be used while the policy holder is still alive. Source: DaveLife. Overfunding An Indexed Universal Life Policy

14 Step 5 Indexing Indexed policies allow policy holders to decide the percentage of their funds that they wish to allocate to fixed and indexed portions. Also, these types of universal insurance policies typically guarantee the principal amount in the indexed portion, but cap the maximum return that a policy holder can receive in their account. Indexed policies offer a variety of popular indexes to choose from, such as the S&P 500 and the NASDAQ 100. The benefit of Indexed Universal Life is, that, it lets you share in a portion of the gains of the stock market in those years when the market goes up, but protects you from losses in those years when the market declines. This is one of the many benefits of Indexed Universal Life. This money is then allowed to grow, tax-deferred, within the policy. Source: Investopedia. What Is Indexed Universal Life Insurance? Aug 12,

15 Step 6 Creating A Tax-Free Retirement Look at the many ways Indexed Universal Life can help you in creating a Tax-Free Retirement. Provides financial security for your family. Builds financial security for your business. Supplements your retirement income tax free! Pays off credit cards, car payments, student loans, or other debts. Covers mortgage payments. Sends your kids to college. Addresses emergencies, if and when they arise. And...much more. 15

16 Step 7 What Indexed Universal Life Insurance is NOT IT IS NOT an investment in the stock market and does not participate in any stock, equity or bond investment. IT IS NOT a variable product or any type of investment contract. You DO NOT buy or participate directly in the Index. The Indexes are simply a measuring tool that is one component used to determine the amount the company will credit to the policy. IT IS NOT a policy where cash value is based upon performance of a variable investment option, such as in the case with variable universal life insurance. IT IS NOT meant to be used as a short-term investment vehicle. 16

17 Final Question Are you 100% certain you re doing everything you can to live a Tax-Free Retirement? If not Take advantage of our Tax-Free Retirement Review. Charles Oliver Hidden Wealth Strategies Call

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