A short history lesson about 401k plans in American. The PDF file also includes an interactive flash calculator on page three that shows how you can safely, have 200% or more spendable income in retirement, without any additional out of pocket savings required.

1. Most People Believe Income Taxes We Can Increase Your
Will Have To Go Up In The Future!
Retirement Income by
Let Us, Help You, Get The IRS Out
Of Your Retirement Income! 25% to 40% or More!
Wealth Maximization Utilizing Tax Favored Financial Concepts
In the late 1980’s early 1990’s the first If it came to be, that not enough was
401K plans were rolled out in being contributed by the average
corporate America. These plans were worker and the plan became what is
mostly for the benefit of the highly
called “Top Heavy” then the highly
compensated employees, whose top
end income tax rates were around 70% compensated workers would have the
It Is As Simple as!
at the time. amount they could save on a tax
favorable basis either reduced or
The overall marketing of these
returned if they already contributed.
programs to the public was to incent
people to save for retirement by They also received an adjusted W-2
allowing them to take a current tax or1099 for that year, for the additional
deduction during their earning years earned income, that they were no
and theoretically they would use the longer allowed to save/deduct.
money in their retirement years and
pay a lower tax on the money during Companies even set up matching fund
retirement, when their incomes would programs to get people to save. An
be lower and their tax brackets would example of this is where the company
be lower as well. puts in an additional 3% of the
In order for the highly compensated employee’s income if the employee
employees to maximize the amount puts in 6% to get the average
they could deduct and save, the employees to participate. Lately many
companies had to include all of the companies whose profits haven’t held
workers in the company. The lower
paid employees, whose future income up have had to reduce or eliminate
would be going up, along with their tax matching funds.
brackets, also had to contribute a
Some companies set up their plans in
certain percentage of the overall
contributions to the retirement plan or such way that required the employee to
the highly compensated employees use some of their savings to purchase
would not be able to participate fully. company stock in order to qualify for
“For these low income employees, did the match.
deferring paying lower taxes today, in “Worldcom and Enron did this and
order to pay higher taxes later, make a ultimately left the employees with little
lot of sense?” or nothing when they went bust.”
Page 1

2. Most People Believe Income Taxes We Can Increase Your
Will Have To Go Up In The Future!
Retirement Income by
Let Us, Help You, Get The IRS Out
Of Your Retirement Income! 25% to 40% or More!
Wealth Maximization Utilizing Tax Favored Financial Concepts
At the end of the day, a matching
“There are a number of major employer contribution to a retirement
corporations today whose 401K plan, if available, is one great gift
from the employer to the employee,
plans have a large percentage of if the employee actually ever gets to
company stock.” use the money, regardless of what the
It Is As Simple as!
underlying reasons for doing so by the
In 2006 a law was passed that allowed employer.
new employees to be automatically
enrolled in the company’s 401K plan, As it turns out today, many people who
unless the employee expressly said put money in these programs found
they did not want to participate in that when they reached retirement and
writing. By doing this, the company wanted to take the money out of these
receives relief from some of the programs in retirement, they really
government scrutiny and top-heavy weren’t in a much lower tax bracket
testing. While they espouse that they but in many cases were in the same or
are doing this in the best interest of the even a higher tax bracket.
employee who is hesitant to start
saving on their own, the bigger win is They are finding that when they take
for the company’s highly compensated the money out of their tax deferred
employees. Having more participants retirement plans they are paying more
in the plan allows them to continue to in taxes than they would have paid had
maximize their contributions. they taken the money initially.
“May be just a subtle back door A couple of things also happened along
way to get the “Average Joe” to the way to affect this:
put money into the 401K.” Almost every tax deduction, except for
home mortgage interest (a goal of
While saving money and receiving many retirees is to have their home
what are essentially free matching paid for, so that may be unavailable to
funds is a great idea for the employee, them as well), has been done away
this may be just a subtle back door way with.
to get the “Average Joe” to put money
into the 401K plans to keep them from “Almost every Tax
becoming top-heavy or keep to the Deduction has been done
government off of their back for away with!”
potential compliance issues.
Page 2

3. Most People Believe Income Taxes We Can Increase Your
Will Have To Go Up In The Future!
Retirement Income by
Let Us, Help You, Get The IRS Out
Of Your Retirement Income! 25% to 40% or More!
Wealth Maximization Utilizing Tax Favored Financial Concepts
Their children have grown and moved Due to the time value of compound
out (hopefully) and are no longer interest and some good years in the
allowable as a tax deduction. market, the people that did save all of
(remember, the dog doesn’t count)
those years. They now have some kind
The Taxation of a portion of your of an income, even though it may be
It Is As Simple as!
Social Security benefits was added in taxable at higher rates than when they
1984. The ordinary income derived put it in the plan, they are probably still
from these plans along with the
feeling pretty good about it.
reduction or loss of tax deductions can
cause up to 85% of their social
“In reality saving money in a
security benefits to be taxed as well.
poor investment still beats not
The other issue is that most of us,
including retirees have been hurt by
saving money at all!”
recent stock market turndowns. The If you managed to save some money
income that many retirees planned on
every year, even though the markets
from the sales of stocks that would
have been taxed at the lower Long have been up and down and the income
Term Capital Gains rates (max 15% is taxable, you would probably have
Federal plus State income taxes) has something to live on which is better
been reduced or disappeared and they than nothing at all.
have had to take more money from
their 401K/IRA plans which are taxed Right Click on the Image Below and
as ordinary income (maximum of 35% view it in full multi-media mode to see
Federal income taxes plus State income how from this point forward, you can
taxes). safely increase your retirement income
Any income they would receive from by 25% to 40% or more!
CD’s and Money Market funds is also
taxed as ordinary income but even
though the rates currently are low
(under 2%), that income is still added
in and will end up on your 1040.
In spite of all this, the good news is,
the “Average Joe” didn’t turn out to
be so Average after all.
Page 3

4. Most People Believe Income Taxes We Can Increase Your
Will Have To Go Up In The Future!
Retirement Income by
Let Us, Help You, Get The IRS Out
Of Your Retirement Income! 25% to 40% or More!
0% Tax on Income with IUL
Instead of saving your money in a tax trap, like a 401k, 403b,
SEP, or IRA. We suggest that you save your money in a
Indexed Universal Life insurance policy that has the minimum
amount of insurance coverage required to meet the Guidelines
It Is As Simple as!
put out by Congress in the tax laws known as DEFRA,
TEFRA, & TAMRA. By meeting these guidelines, you will be
allowed to take income out of the policy on a Tax Free Basis.
This is a New Generation, Life Insurance Product and Should
NOT be confused with a traditional whole life insurance policy.
0% Downside Risk with Annual Reset
Indexed Universal Life policies have a special feature called
ANNUAL RESET. It only allows your money to either grow
from year to year based on the growth of a stock market index
or indexes of your choosing. In the worst case, if those indexes
happened to have a down year, it just retains the same values
from the beginning of the year The product is designed in
such a manner that your money only goes up and it does not
lose any money when the markets have down years.
Your current qualified plans can lose money in the future just
as they probably have done so repeatedly in the past.
For More Information on How to increase your retirement
income by 25% to 40% or more.
Contact:
Louis G. LaBash
louis.labash@insurancechoices.biz
Cell: 678-778-0544
Page 4