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Change Your Outlook on Pensions and Life Insurance

When it comes to the world of investments, there are the two big ones that the majority of people participate in: investments in bank accounts and real estate. But, there is one thing that many of us overlook and just because we don't have enough information on the subject - it's pensions and life insurance. But wait a minute, we're not talking about your regular life insurance policies and retirement plans - in fact, they're not what they seem at all and you'll see why later in the article. First, we will discuss investments in bank accounts and real estate, explaining how they work and why. Then, we compare them to investment strategies in life insurance and retirement plans.

When you put your money in a bank, you invest in it. Banks "promise" to take care of your money, to make it available to you whenever you need it, and they offer a small interest rate on your return, something like 2%, so you can earn some money just by having they hold it. But did you know that even though banks may be FDIC backed in Nevada, banks are only required to pay the maximum amount of $ 200,000 to each individual account holder? In addition, they have 99 years to reimburse these amounts to the people they owe! Banks (like Nevada State Bank) go bankrupt all the time, and so that investment risk is always there whether we know it or not. While the risk may be low (or not), it is important to know that there is a risk and that when it comes to real estate the risk may be greater.

Today, real estate will emerge as the best investment choice. When you invest in a property, you can see it, touch it, renovate it, rebuild it, rent it out, and have tenants pay off the mortgage. Yes! And, yes, ownership in Las Vegas is cheap. My 4 bedroom house in Las Vegas that was once $ 350,000 is now, as of May 14, 2012, $ 76,000. So if you have the cash, now is probably a great time to buy. However, if you are looking to buy a house for short-term profit in the near future, you might just roll the dice in the dark.

No one knows when the real estate market will recover. Pessimists will speak of bad luck and gloom in the real estate industry, while optimists point to the 2012 housing market participation statistics. But, at the end of the day, real estate has everything to do with the unemployment rate. No jobs = no money and no money = no long term investments which = no one can buy you a house even if you had one to sell. Of course, if you have the money and are willing to put up with the worst-case scenario in real estate today: sitting on a house until people can buy a house again - go- y - but remember, who knows how long you have to wait?

So before you do, why not take a look at other investment strategies like retirement planning and life insurance? Have you never thought about it? It's because no one really knows them. To the average Joe, a retirement plan doesn't seem like a profitable investment tool, and life insurance seems like anything but a profitable investment tool. But, it's seeing these investing tools using a traditional perspective - a perspective that was created for the masses.

A very successful retirement planner who specializes in setting up retirement plan and life insurance accounts told me that the super rich have for years used some loophole to avoid paying their tax rates. extremely high. And so, with the right retirement planner, everyone can do the same. Pension and life insurance plans can actually be used like a savings account where you can withdraw your money whenever you want and take advantage of its interest rate. Savings accounts offered by the bank or certificate of deposit accounts usually give you an interest rate of 2-3% on your returns (and that's if you're lucky). Now with pension plans and life insurance you get more than double that: around 5-7% interest rate. Best of all, these accounts are tax free, so you don't need to pay tax when you withdraw from your account. Best of all, there are no withdrawal penalties.

Yes, pension plans and life insurance policies are expertly crafted investment strategies, but again, like any investment ... it's a gamble. But what is the risk? The biggest bet with pension plans and life insurance is the reliability of the companies that provide these services. Can I trust that they will do what they say? Make me some money and not just disappear on a tropical island with all the money? Well, my research has shown that the companies that provide this service, like Bankers, MetLife, and New York Life, have been around for over 100 years and so it is more than likely that they will not be gone anytime soon.

Now, when it comes to the FDIC, some of these investment companies are not backed by the FDIC. I spoke to a company representative and he said they did not need FDIC security. Billions of dollars pass through these companies every day and the reserves they hold are so abundant that your $ 500,000 in 15 year policy is "guaranteed." What these companies expect from you is a planned "contribution" to them of a specified amount of money at a certain time frame. With your constant contribution, they can more easily transfer money from one low-interest "account" to another higher-interest "account" - much like trading stocks. Personally it was a bit difficult for me to trust them at first as I realized that I just bet on them playing with my money. But, when I assess and compare the amount I would "give up" to the amount that I am "sure" to earn, it actually doesn't seem like a bad idea since those investors and traders who manage my money are the best the best.

A representative for Bankers said that with a deposit of $ 135 / week in a personalized retirement plan account, a person would earn over $ 1 million in 30 years. It sounds like a great long term investment, and something I'll have on the side in the near future, if all goes well, of course. And, in the end, like any bet, if the winning outweighs the loss, it's a bet I'm willing to make - a bet I can live with regardless of winning or losing.