David starts the conversation by breaking down his book, Power of Zero, and the problem with America’s ever-rising national debt.
For David, the goal of the book is to guide people on how to move their assets into tax-free retirement vehicles – and how such a move is the only way to shield yourself from potentially higher tax rates in the future.
David describes the difference between LIRPs and other life insurance products.
All LIRPs are life insurance policies, but not all life insurance policies are LIRPs.
David reveals why he believes HSAs(Health Saving Accounts) are the holy grail of financial planning – you get a deduction on the front end, let that money grow tax-free, and then take it out tax-free.
Can you have too much money in your 401K? Yes.
You want to ensure the balance in the IRA is low enough that RMDs (when you are finally forced to take them) are equal to or less than your standard deduction and low enough that they don’t cause Social Security taxation.
You can have a million dollars in your IRA, but unless you can accurately predict what tax rates are going to be in the year you take that money out, you don’t really know how much money you have.
David reveals why many financial planners detest tax-free investing.
Life insurance is not a silver bullet for tax-free retirement. It only works as a complement to other tax-free streams of income.
Is it a no-brainer to get life insurance? David believes it’s not. It depends on your situation.
Always remember that the IRS is looking at how much money you withdraw from your IRA and 401k. If you take out too much, they’ll tax a portion of your social security.
David talks about the benefits of having 4 to 6 different streams of tax-free income.
According to David, we are in the tax sale of a lifetime because taxes in the next three years will never be as low as they are today.
Mentioned in this episode:
David’s books: Power of Zero, Look Before You LIRP, The Volatility Shield, Tax-Free Income for Life and The Infinity Code
PowerOfZero.com (free 3-part video series)
@mcknightandco on Twitter
@davidcmcknight on Instagram
David McKnight on YouTube
Get David’s Tax-free Tool Kit at taxfreetoolkit.com