The WorryFree Retirement® Blog

What Millionaires Know About Investing That You Don’t

By August 2, 2018 No Comments

Interesting question to start: How many millionaires are estimated to reside in the United States of America?

A: 100,000 millionaires B: 1,000,000 millionaires C: 5,000,000 millionaires D: 50,000,000 millionaires.

Well, if you guessed 5 million millionaires living in the United States, you’re correct. In fact, according to Wikipedia, at the end of 2017, there were an estimated 15 million millionaires in the whole world.

Pardon me for all the questions folks, but I want you to really think about these things:

What do millionaires know about investing their money that you don’t? How do millionaires get away with paying fewer taxes than anyone else? How do they make their money work for them and minimize all this risk that we all seem to take? Is it true that millionaires are really risk takers? Do they really consider the element of risk and diversity with all their holdings? Do you really think they want to risk losing those millions overnight like some of you risk losing our money overnight? What does a millionaire look like in this country? Can you tell a millionaire by the bigger homes? Do they drive the most expensive cars? Are they always eating out in the biggest, fanciest restaurants?

It’s interesting this whole take on who is a millionaire can be found in this great book I would encourage you to read. It’s called The Millionaire Next Door. It was co-authored by Thomas Stanley and William Danko. What the book really is talking about is the person next door that doesn’t look like a millionaire, in fact, actually is!

A lot of people who have the financial personalities of savers are millionaires, but they would never show it. They don’t have fancy clothes, they don’t have humongous homes or cars. These are just hardworking people who have saved a lot of money.

In this book, there’s some important points or secrets they highlight to learn from these millionaires next door:

-The number one rule, never spend more money than you actually bring home.

-Another secret of millionaires next door is never paying taxes on the same dollar more than once, which many of you, unfortunately, are doing.

In addition to these two great nuggets of advice from millionaires who don’t always appear to be millionaires, I’ll share a few more nuggets of advice from things I have learned from working with thousands of people over the years that have done pretty well financially.

First of all, millionaires are serious about protecting their money and seeking valuable financial advice. Most millionaires do not just simply go it alone.

In fact, I’d say they value the advice just like savers are valuing advice. The problem with most of you savers out there, you don’t know what questions to ask of these advisors. Or, you don’t trust many of these advisors. In fact, some of you, that’s probably why you’re going to these dinner seminars. You get an invitation from an advisor for a $50 steak dinner, heck, I can’t blame you. You go see what they have to say, and it’s probably the first time you’ve literally listened to a financial advisor.

A great concept to understand is you’ve got to have a coordinated game plan. You’ve got to have something that you can see, something in writing. That’s what we provide our clients.

Number one, the rich understand that you’ve got to talk to an advisor that’s competent. Specifically, hopefully, they’re a fiduciary, which we are. And finally, these folks are going to give you something in writing before investing money. Please do not hand over your money to an advisor if they are not going to give you anything in writing first. That’s the ticket to get your wallet and get out of there quick.

The rich also are not reactive but proactive. Many of you are sitting there and you’ve got all this money in your 401k, and you might be saying, Tony, believe it or not, I’ve got a half million of my 401k. I Already got a million dollars. I don’t need to get any advice. Well, you’re going to be reactive indeed when you go to pull that money out and realize the government’s got a lien on it. I call it a Tax Tumor®. You can’t just sit there and wait till age 70 and 1/2 to deal with these taxes. You’ve got to be proactive now.

Folks, if you get into retirement and you’ve got all your money in the market and we go through another 08 crash, you’re going to be hurting for certain. You’ve got to be proactive.

Let me go through a list quickly of things that we offer our prospective clients and something we’d be happy to offer you if you’d like to sit down and talk to us. These are things wealthy people always think about when they’re planning their retirement.

  1. They all have a plan to maximize their social security benefits. Whether it’s trying to reduce the taxes on them or when to start claiming benefits for social security, which of course we have someone in office that’s certified in social security planning, we can help with this at no charge.
  2. The rich always have at least some money, not all of it necessarily, but somewhere that’s guaranteed. Particularly guaranteed to provide a lifetime income they can never outlive because even the rich as smart as they might be, they don’t know when they’re going to die. They don’t want to run out of money and I assume you don’t either. I call it mailbox money. We can show you how to take advantage of that.
  3. Wealthy people also don’t like unnecessary taxes. They don’t like paying all these taxes and fees. We can assist you with that. Those are the two biggest drags on your money– taxes and fees.
  4. Another thing millionaires do is they want to have a strategy for when to take their IRA or 401k money out. Again, you don’t just wait and take out minimum distributions and then die and leave it to the kids. That’s not dealing with the taxes at all. That’s just putting off the pain and passing off the debt to somebody else.
  5. Wealthy people like to have a written game plan as to what happens when you die. What happens to your stuff. That’s called an estate plan. Again, we can help you think through what to do there.
  6. Finally, they want a plan that just in case one of them goes to a nursing home, that the costs don’t eat up their life savings. We can show you how to use some of your current proceeds to funnel that into instruments to try to protect your wealth should you go into a nursing home or have some sort of other long-term care issue.

If you are nearing retirement, already retired and have been looking for a better way to make money on your money like the millionaire next door do, contact us. You have everything to gain and nothing to lose. Go to our Let’s Get Started page, fill out the form, and one of our full-time employees will be in contact with you shortly to set up a time that is best for you so I can begin to show you how to keep more of your money in your pocket, regardless whether you’re worth $50,000 or $5,000,000.

Let’s Get Started!