Let me elaborate.
First, let me "run the numbers" for you. Let’s say you implement some new taxsaving strategies that reduce your taxes by $4,000 each year. Now, if you take that $4,000 per year in tax savings and invest it over the next 30 years, assuming you earn 11.5% on your investment, you end up with $1,048,745.98 at the end of the 30 years!
And here’s the best part about this scenario: Where did you get the $4,000/year to invest? Well, you got it from money that would have gone to Uncle Sam! It’s money that you used to spend on taxes, part of the 32% of your income that goes to taxes each year.
In effect, it’s free money! It’s money that was always there -- you just didn’t realize it.Is this a good deal or what? In effect, by taking advantage of the tax reduction strategies you’ll read about shortly, the government will finance your million dollar retirement.
And let’s say your tax situation is such that you save $2,000/year instead of $4,000/year. Same assumptions: you invest the $2,000 each year at 11.5% for 30 years. End result: $524,372.99. Not too shabby, eh?
So all you have to do is come up with the tax-saving strategies that will put $2,000 or $4,000 in your pocket each and every year. Which brings us to Step #5.