$5 Billion Tax Free

Transcript

Mike:

All right. Welcome to another edition on Mike on Money. I’m Michael Reese certified financial planner. Oh boy. I’m excited.

Mike:

We are going to talk today about the secret tax Haven. This is like a tax Haven of the super rich, but here’s the best part it’s available to every one of us. Like we all can do this. So this is going to be awesome. We’re going to learn how this guy, Peter teal, this is the guy that started like PayPal. He has at least according to this article, $5 billion. That’s billion with a B right. $5 billion in a tax free, like the super secret tax free shelter. I’m going to tell you what it is. All right. Before I do, though, if you like this video, what do I say every week? Click the like button subscribe. If you haven’t done so already. And of course, please feel comfortable sharing this with your friends, family members, coworkers, neighbors, you know, pretty much anyone, you know, out there.

Mike:

Okay, you’re dying to hear this, right? How do you get $5 billion in a super secret tax-free account that you and I all have access to? Like, why are we not all in on this? Why isn’t the media like yelling at us, saying, guys, look at these guys. These really rich people are putting, getting billions of dollars in these things. You got like Peter Thiel he’s got like $5 billion in there. And I think in this article, like Warren buffet has like 20 million or something like hundreds of millions. It’s like all these rich people, they got tens. Hundreds of millions, billions of dollars in this super secret tax free shelter. And let me tell you all about this tax-free shelter, right? Here’s how it works. All right, let’s get rid of that. Oh, let’s see. Let’s use this color right here. Number one, number one, it gives you tax free, by the way, tax free.

Mike:

When it comes to investing, it’s like my favorite two words, right? I don’t know about you, but I love that phrase tax free growth. It also gives you, two, tax free distributions.

Mike:

Oh my goodness. Look at that. Like this guy’s got $5 billion in here. It gets to grow tax free. Anytime he wants to pull money out. It’s tax free. There’s no tax. Oh, one more thing. Number three. Guess what? When he dies it’s tax-free

Mike:

To his heirs, his beneficiaries. I swear to goodness. I want to call this guy up and tell him I’m available for adoption, right? I mean, wouldn’t that be like? He’s got $5 billion there. I was like, Hey dude, I’ll just take one of them. Just give me one bill. Tax-Free I’ll take it now. One caveat to tax free to his errors. I put a little star here. There’s this little thing known as estate taxes. Those do apply. So this does not protect them against estate tax, but still think about it here. He’s got this account and it started with maybe like a hundred thousand dollars. He used it to buy like some early stock options on, you know, these new companies coming out and that a hundred thousand grew to like a million dollars, but it all grew what tax-free. And then what happened?

Mike:

He took that million dollars. He said, I’m going to buy like more early startup startup companies. And those grew to maybe, you know, from a million to maybe 20 million and then a hundred million then before, you know, I just kept doing it over and over and over again. He now has $5 billion. And by the way, Warren buffet does the same thing. Right? All of these, what? All these really rich people, they do. They’ve got the best accountants in the world. They get the best CPAs and their CPAs are saying, guys, there’s this cool tax free account. You need to put as much money in these things as you can. And they’re doing it. So what in the world am I talking about? What are they using? I told you we can all use this. Like, why are we not all in on this? What is, what is it?

Mike:

Oh, guess what? Here are you ready? Oh my gosh. I’m not even going to write this down. I’m just going to tell you, it’s nothing more than a Roth IRA. It’s a Roth IRA and you know what they did, you know it, they’re just saying, Hey, I got all this money in IRA. You know what they do. They say, I’m just going to convert it to a Roth IRA and pay the tax. And then I’m going to invest in a bunch of things that have crazy growth opportunities. And they, they get, they get some winners and losers, but the winners are big and they grow like crazy. Okay. Here’s my question.

Mike:

Why is it that it seems like every day, like when we do tax planning with people, it seems like every day it’s almost like twisting arms to get people to do Roth conversions. You know, you should be looking at a Roth conversion. Like these wealthy people do, you should be saying, oh my gosh, the question is not. Should I, you know, I know I got to do a little bit of Roth conversion this year, but you know, what’s a small amount I can do and stay in my tax bracket. That that’s a wrong question. Ask the right question is how do I do it? Like the big guys do it. So I can be like the big guys and gals. Really? The question is, how fast can I convert? Like, can I just convert it all right now, pay all the tax right now. Cause that’s what they do.

Mike:

Right. That’s what they did. They all say, yeah, I’ll just get let’s let’s get the IRS out of my life now. Just convert. It all pay all the tax. Now. Guess what? In a lot of cases, that’s a good idea. Not every time, not every time. Remember tax planning is different for everyone, right? We’re all in different situations. I’m just saying, why aren’t we embracing this more? Why aren’t we just, why aren’t we just grabbing these Roth IRAs and just wrapping them around? Just, yeah, let me shove as much as my money in there as I can, because that’s what you should be doing, right? That’s exactly what you should be doing. And when you put money in these things, that’s where, whatever part of your portfolio that has the biggest growth opportunity, that’s money that goes in these things because you want it that money to grow like crazy, right?

Mike:

That’s the goal grow like crazy gross. Tax-Free you can take it out. Tax-Free later on for income. You can leave it to your spouse, your children, your grandchildren. Tax-Free why are we not taking as much advantage of these things as we can? I think, you know, a lot of people out there, they like them, but they don’t understand. You shouldn’t be liking them. You should be loving them. You should be like, wow, I’m all in on these things. Be like the rich use the same super secret, not so secret anymore. Tax strategy, tax shelter that they use. And Hey, good things will happen. Right? All right. That’s this week’s episode. If you liked it, click the like button, click the share button, click the subscribe button and all that good stuff. Leave us comments. And if you have any questions for us, you can always connect with us using the link below. Talk to you again.

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