TAX FREE FOR YOU

TAX-FREE RETIREMENT INCOME

In order to have tax-free retirement income, you must use a tax-deferred retirement account. Although contributions are tax-free now, your taxes are owed at the time of withdrawal. Therefore, making tax-free retirement contributions to a tax-deferred retirement savings account only prolongs the inevitability that you will owe taxes eventually, which may not be right for you. On the contrary, if you contribute to a tax-exempt account, withdrawals are tax-free in retirement. ions

TAX-FREE RETIREMENT ACCOUNT QUALIFICATIONS

A Tax-Free Retirement Account or TFRA is a retirement savings account that works similar to a Roth IRA. Taxes must be paid on contributions going into the account. Growth on these funds are not taxed. Unlike a Roth IRA, a tax-free retirement account doesn’t have IRS-regulated restrictions for withdrawals. If you are likely to be in a higher tax bracket at retirement, then a TFRA is an excellent way to mitigate tax implications. Tax-free retirement accounts also come with a feature called a “floor.” Your funds in a TFRA are indexed to the market, not actually in the market. So if the market goes up, you are credited with a gain. But if the market drops, you do not suffer from a loss. Unlike many other retirement savings accounts, a TFRA is not limited by IRA restrictions, so it allows access to funds. Other retirement savings vehicles tend to have limited if any, liquidity. Tax-free retirement savings accounts have benefits for chronic, critical, and terminal illnesses, similar to long-term care plans. They also have a permanent death benefit. TFRAs are specially designed life insurance plans which use tax laws to their advantage. The permanent death benefit begins on the first day the plan is in effect. Unlike qualified retirement plans, a TFRA does not limit contributions. It must, however, adhere to the rules and laws of life insurance.

5 WAYS TO GET TAX-FREE RETIREMENT INCOME

Roth IRA or Roth 401(k) – Roth IRAs and Roth 401(k)s have tax-free qualified withdrawals at retirement since taxes are paid on contributions.

Municipal Bonds Income – A fixed-income investment that generates interest payments that are typically exempt from federal taxes.
Health Savings Account (HSA) Withdrawals – After an individual reaches 65, funds in an HSA can be used for general non-medical purposes without penalty.
Life Insurance Cash-Outs – An individual can generally withdraw parts of the cash value in a whole life policy to generate retirement income.
Social Security Benefits – Depending on your income level, the Social Security Administration may deem you eligible for non-taxed social security benefits.

TAX-FREE IUL

401K - IRA - PENSION

TAX-FREE IUL SAVINGS

Safety of Principle:

Your Money is NOT invested in the Stock Market
Your Money is NOT Subject to volatility
Your Money is NOT exposed or subject to investment risk
Your Money is NOT Subject to investment loss
All annual growth is LOCKED-IN permanently & CANNOT depreciate in value.

Tax Consequences:

Your Money grows TAX-FREE
There are NO Taxes when you retire & withdraw your money
There are NO Taxes when you die
There are NO Taxes when you pass your money to your family

Access to Your Money:

You CAN ACCESS your money whenever you need it
There are NO early withdraw penalties
You DON'T have to pay it back

Restrictions:

There is NO limit on how much you can contribute to your plan on an annual basis (Up to MEC limit)
There is NO age restrictions on withdraw

Fees:

Charges are a fraction of the expenses & administration costs of a traditional qualified plan.

Effects on Social Security:

Allows you to gain MAXMUM value of the benefit.
No Means Testing

Lifetime Income:

If properly structured, account value will assure lifetime income.

401K - IRA - PENSION

NO Safety of Principle:

Your Money IS invested in the Stock Market
Your Money IS subject to volatility
Your Money IS exposed and IS subject to investment risk
Your Money IS subject to investment loss
All annual growth is NOT LOCKED-IN permanently & CAN depreciate in value.

Tax Consequences:

Your Money grows TAX-FREE
You PAY Taxes when you retire & withdraw your money
You PAY Taxes when you die
You PAY Taxes when you pass your money to your family

Access to Your Money:

You have LIMITED ACCESS to your money
You PAY early withdraw penalties
You HAVE TO PAY it back

Restrictions:

There IS a limit on how much you can contribute to your plan on an annual basis (Set forth by IRS).
There IS an age restriction for withdraw

Fees:

Significant fees charged to cover investment expense and the administration of the account, even if the account depreciates in value.

Effects on Social Security:

Plan benefits are counted as ordinary income, thus lower benefits.
Will be Means Tested

Lifetime Income:

Because of TAXES, FEES and market volatility - lifetime income cannot be achieved.

John Francis, LLC is a licensed insurance agency and brokerage. John Francis does NOT offer or recommend variable annuities or variable life insurance.

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TAX-FREE RETIREMENT SAVINGS TOOL VS. TRADITIONAL 401K & IRA

TAX-FREE RETIREMENT INCOME

TAX-FREE RETIREMENT ACCOUNT QUALIFICATIONS

5 WAYS TO GET TAX-FREE RETIREMENT INCOME

SIDE-BY-SIDE COMPARISON OF THE TAX-FREE RETIREMENT SAVINGS TOOL VS. TRADITIONAL 401K & IRA PLANS

TAX-FREE IUL

401K - IRA - PENSION

401K - IRA - PENSION

TAX-FREE IUL SAVINGS

401K - IRA - PENSION

401K - IRA - PENSION

401K - IRA - PENSION

401K - IRA - PENSION

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