You’re here reading this blog in search of alternatives to Wall Street. We love that! Wall Street is not just an investment, but a mindset to investing, transferring & accumulating wealth. But, do you understand the whole idea behind the mindset of Wall Street?
We’re here to open up this can of worms that we refer to commonly as The Wall Street Mindset. Have you been influenced by one, two or even 3 of these 6 Wall Street agenda’s below?
- Being “Hope” Based
In 2008 there were a lot of financial advisors out there who saw themselves as financial geniuses. It didn’t take them long to realize that it wasn’t the individual’s intellect, but instead a rising market, that qualified one as a financial genius. This is how Wealth Off Wall Street formed & is what it is today.
So many people are truly uneducated on where their dollars are really going. They are investing dollars into a 401k, IRA or 403b with their financial genius advisor, however, when asked what funds are in their plan they look at me clueless like a cow staring at a new gate.
The days of you accepting the idea that losing money is normal are over. Quit building your future around hope. It’s time to take control back of your financial environment & begin growing wealth guaranteed off of Wall Street.
2. Deferring Taxes
Many people think that deferring taxes is a great idea. Even more people than that have no idea that their qualified plan is actually doing just that. That’s exactly what those behind The Wall Street Mindset want you to believe.
Qualified plans (IRAs, 401ks, 403b’s, etc.) were all introduced by our government via The Revenue Act of 1978. In 1980 (1) the highest marginal income tax rate was 70% ($215k+) & you were taxed at 59% for the $85,600 – $109,400 income bracket.
Wow. Today’s taxes seem considerably lower. The highest marginal tax rate in 2016 was 39.6% ($466,958+) & you were taxed a mere 25% for the $75,300 – $151,900 income bracket. Now that you have seen the historical rates, do you feel that tax levels will rise or be lower in the future? If you believe rise, then why would you defer the tax when you are paying taxes at a lower rate today?
Taxes have continued (& likely will continue) to change…shouldn’t your plan of building wealth change with it?
- Arbitrary Numbers
When you are stuck in the Wall Street Mindset, the ages 59.5 & 70.5 are extremely important milestone ages for you. Why? This is when you can access your money in qualified plans penalty free.
You give them your money, keep giving it, & let them keep it for as long as they possibly can. That’s how the process goes. They handcuff you from accessing your money while they use it until you are 59.5. If you withdrawal it prior to that age you will be hit with a 10% penalty (+income tax).
For a magical 11 years (between the ages of 59.5 – 70.5) you are able to withdrawal your money penalty free (+income tax). However, once the clock strikes 70.51 you are back into the penalty phase. From this point on you must make a minimum distribution or else pay a 50% holding penalty (+income tax). Ultimately, your qualified plan is subject to penalty for up to 85% of the life of the plan.
Who’s really in control of your dollars here?
4. The “Accumulation” Theory
Why do you need a specific “number” to retire on? Whoever decided that it is normal to stop receiving income upon retirement? There are ways to earn income without working for it. The Internal Revenue Service refers to this as passive income.
Nothing that has to do with a traditional Wall Street investment has anything to do with passive income.
5. Parking Money Long Term
Would you ever buy a car & wait 5 years to drive it? Yet, we have been told that is to our benefit. Financial advisors across the nation encourage you to contribute a monthly % to a qualified plan or mutual fund & keeping an annual “finger on the pulse” when you receive statements in the mail.
The problem? What if that money could be compounding each & every year off of Wall Street? What if a guaranteed opportunity with a higher interest rate came about, but Wall Street had hold of your money?
There should never be a line drawn between you & your wealth. Remember that!
6. The “Herd” Mentality
This is a topic we are extremely passionate about. People are downright afraid to just think differently. Today, consumers are swayed by thousands of marketing messages per day. I get it. Sometimes, you just want to take the easy way out & continue the trend of what your neighbors, parents, Sunday school couples or even (gasp) in-laws are doing.
However, just because they do it most definitely does not make it right. If you haven’t already, I would encourage you to read more on this thought through an entertaining, brief blog about Rick Barry & his story of success here.
So, the verdict is out. It’s clear that Wall Street has an agenda & that agenda is to separate you from your wealth while encouraging you to following the rest of the uneducated herd.
Are you ready to break free from this wash, rinse & repeat influence of the Wall Street mentality? Get started by learning ways to accumulate wealth off Wall Street by subscribing to our Podcast here. We promise, this is unlike any other financial podcast you have EVER heard (in more ways than one).
- ALL income tax levels based on married filing jointly rates