Dear CD Buyer,
How does a 10% return sound?
How about a 10% return with tax savings?
The stock markets did well in
2006, .If you owned the DJIA Stock Index last year, you would have made over
15%. Of course, if you would have owned the same index in 2002, you would have
lost 16%. So while we can be happy about our recent index returns, there is
certainly risk and volatility with playing the index.
Of course, there is nothing wrong
with investing in the Dow Jones index as long as you understand the risk and
volatility. I personally own some index funds. That is not the real point here.
Most Mature Americans today are
tired of losing money in the stock market. They would like to increase their
monthly income, but are faced with low rates on certificates of deposit. Most
importantly, they want to ensure they never run out of money in retirement.
The point is that many of you
are NOT willing to take the risk and accept the volatility of the stock
market, so you have been and will continue to be in a position to explore other
options.
And if you are in a situation
where tax-friendly returns are necessary (reduce income taxes, reduce SSI
taxation, eliminate subjection to the Alternative Minimum tax, etc.), then
you have some alternatives available to you.
Some fixed-index annuities
returned over 10% in 2006 (these annuities are tax deferred).
Some municipal bond funds returned
over 10% in 2006 (yields from municipal bonds are tax-exempt).
Both have much less risk than
index funds as well as reduced or even zero volatility. How does that compare to
your investments with similar risk and volatility factors?
Did you earn 5% in your bond funds
last year? (the Lehman Brothers Aggregate Bond Index return for 2006 was 4%, so
5% would even be above average)
How about your bank CDs? What is
your "after-tax" return on those? If you are in a combined 30% tax bracket
(federal + state income taxes), then that yield of 5% was actually a net return
of 3.50%!
My point here is that YOU CAN
DO BETTER!
Talk to your financial advisor
today to find out how to get a better return from your lower risk assets.
Please, Don’t Procrastinate
If you do not have a financial advisor, them please visit
SeniorsOnlyFinancialAdvisor and find a financial advisor in your area.
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for illustration and educational purposes only. It should
not be considered as advice or an endorsement to purchase or
sell any security or financial instrument. We do not and
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