Money in “801(k)” Plans…
January 31, 2008 | Author Dr Agon Fly
Every now and again the market creates something out of nothing. The “801(k) Plan” sales letter you might receive in your inbox creates nothing out of something.
A sales letter published by Stansberry Research touting the “801(k) Plan” seems to be describing what are commonly called:
Dividend Re-Investment Plans or DRIPs
The claim of Stansberry Research that these plans are somehow “secret” is a stretch at best. So also are their claims that you can make millions with such plans investing only a few dollars a month.
DRIPs have a place and can be a valuable addition to your money plans. Beware, however, that if you were relying on a DRIP from ENRON or MCI your drip became a drop and then evaporated. Investment advisors do not normally recommend this approach because there are no commissions involved so you’ll need to do some research to discover if it is right for some small portion of your savings and investment dollars. DRIPs are designed to be consistently funded and can have fees associated with them that make buying and selling DRIP shares less profitable.
More importantly, you’ll want to have clearly defined set of money practices in place before you ever embark on any investment program. A DRIP, for example, that is funded by tax free dividends from a participating whole life insurance policy can produce very good tax advantaged returns without putting a single dollar of your guaranteed accounts at risk. Advisors who practice and teach Money for Life know of these strategies. Most others don’t.
You’ll never regret knowing more than you do now or owning - without debt-to-others – more than you do now…
Posted in Money, Personal Financial Management, Taxes, Whole Life Insurance | 
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