Beware of Insurance Agents Pitching “IRA Rescue” Strategies
This is a consumer protection website to warn readers about the ever prevalent IRA Rescue concept.
If you have been pitched this plan, I encourage you to report it by e-mailing firstname.lastname@example.org.
If you’ve been sold one of these plans, e-mail me at email@example.com or call me direct at 269-216-9978. You will need immediate help to protect your retirement nest egg.
What is IRA Rescue? IRA Rescue is a “tax-saving” concept that:
1) Removes money from an IRA (at which time taxes and potential penalties are paid)
2) Uses the money withdrawn from the IRA to fund a Cash Value Life Insurance policy (typically an Equity Indexed Universal Life (EIUL) policy).
Why does this make sense? It doesn’t make sense mathematically which is why I created this consumer protection website (and wrote my book, Bad Advisors (www.badadvisors.com)).
Two Primary Sales Pitches to AVOID!
1) Three-pay liquidation of an IRA. Click here to read why this doesn’t work.
1a) Same as 2) except it’s a five-year strategy instead of three. Click here to read why this doesn’t work.
2) 72t or systematic withdrawal approach. Click here to read why this doesn’t work.
What’s the sales pitch?
1) IRAs are tax-hostile tools, and you need to remove your money from it NOW and put that money into a “tax-free” retirement tool (Cash Value Life).
2) Cash Value Life allows money grow tax free and come out tax free in retirement. (Cash Value Life can work as a nice retirement tool if funded “appropriately” before age 55. Click here to learn more).
The question for a potential client is: Would you like me to show you how to “rescue” money from your tax-hostile IRA so it can grow tax free and be used in a 100% tax-free manner in retirement?
If you didn’t know better, would you listen to such a sale’s pitch? Most would say YES.
Why is an IRA tax hostile? Because all of the money, including the growth, will be 100% income taxed when removed.
Why is Cash Value Life better? Because money can, in fact, grow tax free and be removed tax free from the policy in retirement.
Where do you find the money to pay the taxes on IRA distributions? This is one of the most manipulative parts of the sale, and it merits its own page to explain how dangerous the tactic used really is. Click here to learn more.
What’s the problem? The math is absolutely bogus. It does NOT work.
How can that be? As is often the case in the insurance world, insurance agents do not do the required research to determine what really works and what is being sold on a bogus assumption with smoke and mirrors. They are so blinded by the huge commissions that come with IRA Rescue that they don’t care about doing their due diligence. They just want to sell, sell, sell (to their client’s detriment).
If you have been pitched IRA Rescue or know a friend of loved one who has been pitched IRA Rescue, please contact me immediately at firstname.lastname@example.org or 269-216-9978 for help.