What's Your Safe Money Plan for Retirement?

entrepreneur.com

70 NEWS JAPAN - Paper wealth is meaningless when it comes to true financial security. Or, more accurately, there's an enormous difference between paper wealth and real wealth. With investments, until you sell an asset and lock in any gains you have (hopefully) accrued, all you really have is a bunch of numbers on paper. This applies to your retirement and investment accounts, your college savings plan, your real estate appraisals and the valuation of your business.

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In order to have true financial security, the numbers on your statements must be locked in and not subject to the whims of the market or economy. You should also be able to access your money for anything you want, any time you want, without having to ask permission or sell or liquidate assets.

In researching and investigating more than 450 financial products and vehicles, I found a little-known strategy that meets all five requirements listed above. It allows you to know the guaranteed minimum value of your savings on the day you retire and every step along the way.

It's based on an asset that has increased in value every single year for more than 160 years, through every period of economic boom and bust, including the Great Depression. The asset is a supercharged type of dividend-paying whole life insurance.

Many people have a knee-jerk negative reaction when they hear the words “whole life insurance.” Some financial advisors complain that the cash value in a whole life policy grows too slowly and commissions are too high.

Unfortunately, many advisors and insurance agents emphasize policies that come with a big commission. However, there are financial advisors willing to forgo that paycheck who have advanced training in setting up these kinds of policies.

Some folks may think age or health concerns disqualify them from using this savings method, but that is usually not the case. There are plans available for people up to age 85. Many business owners and professionals start their plans after age 60.

Unique among savings plans, this strategy lets you recapture interest you’d otherwise pay to banks and other financial institutions.

It’s interesting to note that our nation's banks own billions of dollars of guaranteed, high-cash-value permanent life insurance -- about $135 billion of it, according to the latest available statistics. That's because banks are legally required to have a foundation of very safe liquid assets, known as Tier 1 capital. Life insurance is considered to be so safe that bank regulators allow life insurance policies owned by banks to meet their Tier 1 capital requirements.

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One final, powerful benefit of this plan is peace of mind. Since it requires no luck, skill or guesswork, you can be confident that you and your family can reach your personal and business financial goals without taking unnecessary risks.