Some may think this type of downturn in home values would automatically spell doom for any type of equity management. But not necessarily so. People who used Successful Equity Management strategies and invested their equity dollars (even if they were shrinking) in maximum-funded, tax-advantaged insurance contracts were able to preserve that equity in savings vehicles that did not lose during this economic crisis.

Why? Because the equity was separated from their homes, safe from the downturn in the market. It was positioned in insurance contracts that guarantee no loss – and some contracts even experienced returns.

Learn now how to protect yourself – and your equity – so you never have to lose again. Contact us.

Just How Safe is Your Fixed Mortgage?

The AARP recently published a story by Carole Fleck entitled “Foreclosure: I Didn’t Think it Could Happen to Me.”

The story reports on the growing foreclosure crisis. It reveals that the crisis is no longer limited to high-risk borrowers; it is now spreading to “middle-income Americans who had fixed-rate loans, among the safest on the market.”

Ms. Fleck reports:

“Widespread job losses and falling household income have changed the nature of the foreclosure explosion. The crisis began nearly two years ago with subprime mortgages offered to borrowers who were poor credit risks, but has now spread to prime fixed-rate loans…one in three mortgages in foreclosure in this year’s second quarter had a fixed rate. During the same period last year, it was one in five.

“In many cases, those homeowners in foreclosure are people who thought it could never happen to them. ‘These are not people living on the edge,’ says Michael Fratantoni, vice president of the MBA’s single-family research division. ‘These are your more conservative homeowners who’ve lost their ability to pay their loans because they’ve lost their jobs.’”

The story continues by sharing just how widespread this problem is and why it will continue through 2010.

Why Missed Fortune Clients Don’t Fear Foreclosure

Everyone who has followed the Missed Fortune strategies for the last 5-10 years hasn’t lost a dime in home equity — even if their home value has gone down. They have liquid cash and are protected from the risk of foreclosure.

This is because they understand how vital it is to secure the following benefits in all financial and investment strategies:

1. Liquidity
2. Safety of Principal
3. Rate of Return

We call this the “LSR” test, and the innovative and secure Missed Fortune strategies help you achieve all three of these with your mortgage.

Consider the following investment and ask yourself how much you would invest in it:

• You determine the amount and length of time for monthly investments to continue.
• You can pay more, but not less than the minimum monthly payment.
• If you attempt to pay less, the financial institution keeps all the previous contributions.
• The money deposited is not safe from loss of principal.
• Each contribution results in less safety.
• Your money is not liquid; you can’t get to it when you really need to.
• The investment carries a zero percent rate of return.
• Your income tax liability increases with every contribution.
• When the plan is fully funded no income is paid out to you.

Can you guess what this investment is? It’s your mortgage. Home equity fails all three of the LSR tests — it’s not liquid, it doesn’t guarantee safety of principal, and homeowners rarely realize a rate of return.

You can download the radio podcast made by Doug Andrew on this subject.

With a mushrooming national debt-close to $13 trillion by years’ end-and relatively low interest rates on that debt, the government has been behaving like many of its much-maligned citizens. It’s been racking up debt with the attitude that somehow, someday, it’ll figure out how to fix the mess it’s making.

Well, guess who the government will be turning to fix its mess. That’s right, us. The only way the government can generate more revenue to pay down its deficit is to: 1) print more money (which causes inflation), or 2) raise taxes.

It doesn’t take a degree in finance (or a crystal ball, for that matter) to know that the government will likely raise taxes-significantly-in coming years. So it behooves all of us to find tax-advantaged ways to save for retirement so that we can enjoy the fruits of our labors, rather than handing most of our harvest over to Uncle Sam.

Maximum-funded, tax-advantaged insurance contracts are the only savings accumulation vehicles where your money: 1) accumulates tax-free; 2) can be withdrawn tax-free (even before age 59 ? – without penalty); and 3) transfers to your heirs income tax-free when you pass away.

If you’ve already invested your serious money in traditional plans such as 401(k)s or IRAs, it’s possible to implement a strategic roll-out to reposition your money in MFTA insurance contracts. And with the likelihood of soaring taxes in the future, the sooner you do it, the more you can save.

Find out how to protect yourself and your money by contacting me.

Read the article by Doug Andrew

What has the government done with its recent financial challenges? Rather than cutting back, it’s chosen to spend more. In fact, we’re looking at an estimated deficit of $1.8 trillion this year alone, which will be quadruple last year’s deficit.

With this kind of spending, the government will need to generate more revenue to make up the difference.

And how does the government generate more? One of two ways: 1) The government can print more money (which causes inflation), or 2) it can take the money from us in the form of higher taxes.

We’ve got to face the reality that taxes are likely only going up, not down, in the future. And it’s also important to realize that your money is worth now more than it ever will be (because of inflation), and that you are likely in the lowest tax bracket you will ever be in (because of several factors, including the likely waning of tax deductions as your financial situation changes in the future).

So what can you do to protect yourself? You can start by repositioning money out of your taxed-as-earned (like CDs or money markets) or tax-deferred savings vehicles (like 401(k)s and IRAs), and put your serious money in maximum-funded tax-advantaged insurance contracts. These are the only savings accumulation vehicles where your money: 1) accumulates tax-free; 2) can be withdrawn tax-free (even before age 59? – without penalty); and 3) transfers to your heirs income tax-free when you pass away.

Begin now to empower yourself, and your financial future.

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Missed Fortune Radio – August 2, 2009

Read this PDF as Doug explains what we have been doing for years with all of our clients.

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Missed Fortune Radio – July 19, 2009