FAQ: Are retirement options for "rich people"?« Back to Questions List

Are the options for 401(K) and IRA for ”rich people”? No, not always.  Although, when your cash flow is larger and you can afford to fund your financial vehicles better, they can certainly increase the capital factor, one multiplier, in the yield on your returns. While the strategies I review with my clients and prospective clients were developed by and for those with high cash flows or vast wealth, they can be easily used by people of modest means.  It’s one of the reasons that your average blue collar worker or upper middle class family have not been told about them.  The people pushing the 401(k) and IRA systems sponsored by government and engineered by Wall Street brokerage houses make more money by keeping these ideas quiet. What’s the best application for these strategies? Any financial investment or business venture grows quicker and more effectively with higher amounts of cash flow or capital to fund the venture.  This is news? If you’re working early enough and give your plan more time to grow, you take advantage of compound interest over time.  Of the three attributes in the ”time value of money” that allow investments to grow, time is the most powerful.  If you plan ahead and start as early as possible, that’s now, this allows you to use time with more modest amounts of capital to energize the vehicle that takes you to your goals.