Teamwork — Retirement — Great Start For Young Investors

Posted @ 11:49 pm - Filed under Financial Planning, Check This Out, Retirement

One of the benefits of working with Brown & Brown to maximize what your retirement is working with our team. Our team consists of separate, stand-alone groups wherever we invest for our clients. It also includes the use of our team’s financial investment advisor, Doug Johns. Doug has added a new potential basket for our clients in terms of retirement income. More on Doug another day. If, however, you’d like to speak with him, email me through the blog here, and I’ll send you his contact info.

We love what real estate affords our clients — there’s nothing better. But real estate isn’t the only tool in the box with us. Ultimately, a retiree will tell you a stable, reliable, and abundant income is what makes a magnificent retirement. We’ve recently run into some very bright, and very young folks who are at the beginning of their careers, not yet ready or able to invest in real estate. This is another chance for our team to shine, because Doug can help these younger folks get going.

I have great interest in these young men and women because they’re my kids’ ages. My son is my partner, and much like the 20-somethings contacting us via the internet, he’s college educated, well into his new career, and very bright. His little sister is a couple years from her college degree. So I’m sensitive to their generation’s interest in the future, especially as it relates to retirement.

To that end, let me explain in outline form, what has generated interest from these young people. It’s a great alternative to real estate investment — until they are able to enter that arena.

I’m talking about investment grade insurance. No, not like the life insurance your dad has. This is designed to produce a lifetime of tax free income, and is a very attractive item to have on your retirement income menu. Here’s how it works — it’s called Fixed Index Universal Life, or FIUL.

First, let’s define who you are. Let’s make this example be a 25 year old male, in good health, and a non-smoker. (In fact, here’s two of ‘em.) By the way, if I’d made this a female, the numbers improve. Go figure.

You decide what you can reasonably afford to set aside each month. Let’s say it’s $250. You then set an appointment with a para-medical type who comes to your home for a quick physical. Blood pressure, heart rate, maybe urine, just the general once over. The insurance company pays for this, so no worries.

At that point my financial investment advisor, Doug Johns, does a complete and unique analysis tailored to you specifically. Your cost is the monthly payment you felt you could afford comfortably. After a fews years, and a few pay increases, you can increase your monthly payment, which will increase your retirement income. The results are, understating the case, magnificent.

I’ll cut to the chase here. My daughter, 23 in July, will begin paying $500 a month into a FIUL. She’ll do this for 20 years — then she’ll stop and let all that money, and it’s 20 years worth of compounding return, simmer for another 10 years. She’ll then be 53.

If she decides at that point to walk away from the word-a-day world and retire, it will be on a pretty nifty income. Her income from that day on will be $100,000 a year — tax free — for life. Unless any employer for whom she may work, offers her a dollar for dollar match on a 401(k) for whatever amount she chooses to contribute, she’ll never contribute the first dollar to one.

She’ll have more income by her birthday every year than the poor guy next door who built up his 401(k) to a million bucks! Sometimes life isn’t fair.

This entry was posted on Tuesday, June 5th, 2007 at 11:49 pm and is filed under Financial Planning, Check This Out, Retirement. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.