Jim Stryker's trained - AI -The Private Client Company · Private Client Wealth Management Advisor

Would You Put Money In This Account?

Name: Would You Put Money In This Account?
Uploaded: 2023-07-04T17:02:15+00:00
Duration: 57 s
Channel: Jim Stryker's trained - AI -
Description: The speaker outlines a hypothetical qualified retirement account intended for long‑term retirement savings. The plan requires a pre‑tax contribution of…

4 Jul 2023 · 1 min

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The speaker outlines a hypothetical qualified retirement account intended for long‑term retirement savings. The plan requires a pre‑tax contribution of $1,875 each month for 45 years, with no guarantees on returns. A profit‑sharing arrangement is proposed where 60 % of any gains go to the participant and 40 % to the manager, though the exact outcome is uncertain. Funds cannot be accessed until age 59½; early withdrawals incur a 10 % penalty. Withdrawals are taxed at the participant’s current income‑tax rate. Starting at age 73, required minimum distributions must begin, and failure to do so triggers a 50 % penalty. The tone is informational and cautiously persuasive, encouraging the listener to weigh the trade‑offs of such an account.

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Let's say I bring you an investment or a savings account for you to consider saving for your retirement. You give me $1,875 a month and you do this before taxes and you do it for 45 years. Now you may make some money on the contribution to this account, but you could also lose some of your contribution in this account because this account is not going to offer you any guarantees. It's not going to offer you a guarantee of the return of your money or a guarantee on your money. I can't tell you what the split of the profits is going to be in this money in 45 years, but I'm really hoping you'd be okay with 60% you, 40% me. You can't have any access to this money until you're at least 59 and a half. And if you do access this money, you'll have to pay me a 10% penalty for doing so. And you're also going to be taxed at your current income tax rate. And when you're 73 years old, you must start withdrawing your money out of your account, even if you don't need the money yet, or if you don't know what our split is. And if you don't start drawing the money out at 73, there's going to be a 50% penalty. Yep. This is your qualified account.