Three Strategies to Grow and Protect Your Savings
Understanding how your money can grow is key to reaching your financial goals. Here are three common approaches to saving and their impact on your long-term financial future.
Common Savings Methods
Traditional Savings Accounts (Fixed Growth)
- Widespread Use: Approximately 98% of Americans use these accounts.
- Safety & Accessibility: They are familiar, widely accessible, and generally considered safe.
- Low Growth: Typically offer low interest rates (often under 1%), which limits significant wealth building over time.
Retirement Accounts: IRAs and 401(k)s (Variable Growth)
- Common for Higher Earners: About 20% of middle to upper-income Americans contribute to these.
- Employer Benefits: Often include employer matching contributions, which can accelerate growth.
- Market Fluctuations: Value is tied to the stock market, leading to potential gains or losses.
Indexed Universal Life (IUL) Policies (Indexed Growth)
Indexed Universal Life (IUL) Policies (Indexed Growth)
- Preferred by the Wealthy: Chosen by a small percentage (about 2%) of Americans, typically the ultra-wealthy.
- Growth with Protection: Funds can grow with the market while being protected from losses during downturns.
- Powerful Tool: Offers both growth potential and downside protection for wealth building.
Choosing Your Retirement Strategy
When planning for your future, consider these two key questions:
- How will your money grow? (Fixed, Variable, or Indexed)
- When will you pay taxes? (Now, Later, or Never)
If you value growth potential without market losses and desire tax-free retirement income, an Indexed, Tax-Advantaged strategy may be an ideal fit.
To see how this strategy could benefit you, we invite you to schedule a free consultation.