Young Single Professional Woman, age 26

The account with which we matched this young professional woman provided the ability to leverage a large sum of tax-free money available to her while allowing her to build wealth away from the market downturn exposure of Wall Street and at much better rates than those available from the banking industry.    Both capital and earnings of such an account could be made available to her without it being classified as “earned income” and would therefore not be taxable.This young woman took a job with a doctor’s office as receptionist while in high school and advanced her training while working to become a medical assistant.  Being single and having a good relationship with her family, she continued to live at home with her parents despite making good money over nearly 10 years.  Maintaining low living expenses freed up considerable funds while she was yet young to begin building wealth that could grow over a number of decades prior to retirement.

Has anyone shown you how to generate “tax-free income” for retirement or other purposes that may interest you prior to age 59 1/2?

In addition, the custodian of the account would allow her to borrow against her matured and funded account (post year 5) at either “zero-cost” or by allowing her to net a difference in account credits versus loan cost.  In effect, she could earn a return on money that she accessed and used elsewhere as if it were still in the account continuing to earn interest.  Being a completely legal form of collateralized loan, there’s simply no other type of financial account that allows a client to leverage their wealth in this way.  The creative and adept investor or entrepreneur might consider ways to use such options to “double-dip” their returns.

Conclusion:  While you are young and living expenses are low, compound interest (earning interest upon earned interest over a number of years) can supercharge your wealth-building efforts which open up early retirement options, funding your own business, and other significant financial opportunities.  Time is the most powerful factor in building wealth and the earlier your start the more time (financial power) you can generate!  It is also most beneficial to educate yourself on the types of financial accounts used by affluent business people and wealthy individuals so that you can take advantage of them when you are both ready, and still young enough to benefit from them for the longest amount of time.

Image courtesy of imagerymajestic @ freedigitalphotos.net

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