Think about the major purchase decisions you have made over the past year. Were they financed or did you pay cash?
When a purchase is financed, you pay interest. Money you will never recoup. When you pay cash, you lose the opportunity to build your wealth using compounding interest. With a private banking strategy, you provide yourself with tax-exempt income while preserving your capital and liquidity. It is an opportunity for you to create and grow your wealth in a tax-advantaged way by providing you with both tax-deferred growth and tax-free distribution.
Unlike a Roth IRA, you can put away tens of thousands of dollars on an annual basis. The dollars you save will grow on a tax-deferred basis, and can be accessed on a tax-free basis, without penalties. When the money is needed, you simply borrow the money from yourself and pay it back with interest, which enables you to grow your net worth.
Imagine you wanted to buy a piece of real estate for $100,000 and you took out a loan at a modest 10% interest rate to be paid back over a 20-year period. At the end of the 20 years, you will have paid an additional $58,389 in interest. That $100,000 piece of property actually cost you $158,389. Now consider if you had purchased that same piece of $100,000 real estate using your private banking strategy. The loan would still be paid back over a 20-year period, but your personal banking strategy account earns a 2.5% interest rate. The interest earned in your account over the 20-year period is $64,786. That $64,786 is your money and now the $100,000 piece of property actually only cost you $35,214.
A private banking strategy not only gives you the ability to use your own money for necessary items, but is a great addition to your retirement portfolio. But what exactly can you use the money in your private bank for? Well, think again about your major purchases over the past year.
They may have included:
- Real Estate
These are just a few examples of the purchases you could have made by borrowing money from yourself.
The money put into your private banking strategy is based on how you are using your private banking strategy and your strategy’s objective. It can include deposits you make directly into the account, loan repayments from borrowed funds, interest earned on the initial balance of the account, and interest generated from borrowed money.
Private banking strategies are just one of the strategies the financial professionals at Tax Saving Professionals use to ignite your wealth from your hidden money.