your plan, not the government plan. and i'm going to show you how to create that plan. [applause] remember, either way, you're going to get a plan. you make a plan, or you get a plan. the plan is done by you or to you, and when you get a plan, you will end up with more money for you to enjoy now, more money for your retirement, more for your loved ones, and more of it tax-free. [applause] that's how you stay rich for life! now, here's where it comes down to. we're in an economy that i call a "yo-yo" economy. you're on your own. the two wells of financial support that we've come to rely on, they're both empty. they're both run dry. government and business, they're both broke. business is broke. there's no more pensions anymore.

if anything, you have 401(k)s. but that is, that's business' way of transferring the risk, the responsibility, and the cost of saving for retirement from them to you with your own money. that's not security. even the biggest and oldest companies, there's no guarantee they're going to be in business over the long haul like there used to be. they can't guarantee their employees' financial security anymore even when those employees have devoted their whole working lives to that company. they're broke. government's broke too. look what's going on with these bailouts, hundreds of billions-- billions with a "b," like bill gates-- billions, hundreds of billions in bailouts. where are they gonna get the money from that? they put it on a credit card. who's going to pay that bill? who's going to bail out america? >> all: we are. >> you and me, that's who.

because when it comes to your iras and your 401(k)s, remember, that money has not yet been taxed. that's like a big juicy steak to our hungry, insatiable government. it's about the taxes. it's about how much you keep at the end of the game, managing the taxes, managing those accounts that have not yet been taxed. that's what this is all about. government is broke. our businesses are broke. it's all up to you to create your own plan to manage those taxes. see, it comes down to this: really, i don't want to sound antitax or antigovernment or anything like that. i'm more in the arthur godfrey school. here's what i mean. arthur godfrey, you remember him? a famous entertainer? he had a great saying. he says:

that's what i'm talking about. there's no reason to pay more in taxes than you have to or pay sooner than you have to. that's what we need to address. that's why we need a plan-- our plan, not the government's plan. see, the way it works with taxes-- with an ira, a 401(k)-- that money has not yet been taxed, so here's the way it works. an ira, like a baby, is born with a twin brother, comes out with a twin brother, uncle sam, the evil twin. [laughter] and as the ira gets bigger and bigger, so does uncle sam's share. in other words, uncle sam is a partner on your life savings. as the ira gets bigger, so does uncle sam's share until eventually uncle sam gets more than you do because uncle sam becomes the senior partner on your retirement savings. you know what a senior partner means? it means they get more than you. well, we have to reverse that equation.

that's what this is about. we have to reverse that equation. uncle sam becomes a senior partner on your account. how high can taxes get? well, let's go back in a little history, in a little history lesson. you know, when our tax system first started back in 1913, the 16th amendment to the constitution, back in 1913, our creators of this tax system used two words to describe the tax system they were proposing: small and non-intrusive. does our tax system seem small and non-intrusive? here's where they started. they said, "well, we're just have a low 7% rate." some people said, "well, maybe we should cap that rate." and they said, "nah, it'll never get past 10%." in fact, when the first tax return came out, there were only four instructions. so easy a caveman could do it. now there are 4,000 instructions.

when the first tax return came out, it was so compact, they actually printed it on the front page of the new york times. now let me take you through a little ride of where tax rates have come. true: the tax rate started at 7%. it was only supposed to apply to the rockefellers, the carnegies, the vanderbilts, and the morgans, only the real rich people. but let's see where tax rates have come. i'm going to show you the top federal tax rates. now, remember, these are the top rates, so they're only paid by the very wealthy, but the point is, if congress can enact rates like this, they can do it again. so it's true. it started out at 7%. but by 1918, world war i, it was up to 77%. then take the years of the baby boomers, 1946 to 1964, you know, the top federal rate exceeded 90% every one of those years except the last year, 1964,

when it went down to a paltry 77%. that was the year of the baby boomers. remember, they were babies then. they didn't need much from government then. now they're already collecting on the other side. in some form or another, they're going to become some kind of dependent on the government. that's now, so can you imagine what the rates could be? so the rates stayed at around 90%. then they went down to the 70 percentile. so it stayed at about 70% from 1965 all the way up to 1981. and then--oh, happy day-- in 1982, the rate went down to only 50%. for the first time since the 1930s, we were actually equal partners with the government on our own money. isn't that great? so here's what i have to say about that.

mark twain said it best, actually. he said: i'm saying this can happen again, and we need to plan for it. but wait. there's more. it gets worse. that's only federal taxes. what about state taxes and, for some of you, city taxes on top of those rates? remember, a lot of states are going broke. they're out of money-- states like mine, new york, california. in fact, i just saw this piece. i was out in san francisco recently. this is in the san francisco chronicle talking about san mateo county. "millions lost in financial fiasco. "county's portfolio with lehman brothers hit for $150 million." what does the san mateo county treasurer have to say about it? let's see. that's it.

where are they going to get the money from? from people like you and me that did everything right. we put money in iras and 401(k)s and then we got our tax deduction, and then we were told the big lie. you know what the big lie is? remember that? that's not even true now. that's not even true now in today's rates. really, most people, looking at today's rates, you don't know how good you have it right now. it's only 35%, the top rates. but that's not even true now. why? because at some point, after 70 1/2 all those savings and 401(k)s and iras, it has to come out. the government wants its money back. and you have to add that income, whether you need it or not, to your tax return. you got to know how a tax return works. a tax return is like a pinball machine. any time you add income,

all the bells and whistles go off, and anything good on a tax return, like deductions, exemptions, credits, start phasing out. so you end up paying more money because you had to add income to your return that you didn't even need. your social security gets triggered for taxation. and that's now. there must be another way to deal with this. maybe i just won't pay taxes. that's not gonna work. somebody in my state, a highly placed official, tried that. this is from the new york times. he owed hundreds of thousands in back taxes and claimed, and i can't make this up. that's why i'm showing you the new york times. he claimed he had "late filing syndrome, "a condition that made it difficult for him to fill out his tax returns," his lawyers said. "late filing syndrome, "sometimes known as non-filing syndrome, "or failure to file syndrome, "is not listed in the diagnostic and statistical manual

"of mental disorders. "a spokeswoman for the american psychiatric association "said that the group does not recognize it as a psychiatric condition." [laughter] so that's not going to work. we need a plan "b." here's plan "b," which is really plan "a." remember, this very tax code is loaded with items that can wipe you out of your retirement savings. but it's also filled with those golden nuggets, if you know how to mine them, that can help you end up with more money for you to enjoy now, more for your retirement, more for your loved ones, and more of it tax-free. that's how you stay rich for life! it's loaded. they're all in the tax code. it's hard to find even for professionals. that's why they call it the code. [laughter] i'm here to tell you how to crack that code. that's what we're going to do, how to crack that code. remember, uncle sam is the senior partner on your retirement account.

so we have to do something about it. what do we want to do? we want to get rid of uncle sam as the senior partner on your retirement account. how do you get rid of any partner? you buy him out. think about it. if you got rid of your partner, wouldn't you end up with more money? don't look around. i'm just saying. [laughter] if you got rid of your partner, you'd end up with more money. well, uncle sam is the senior partner on your retirement savings. so we have to buy him out so we can have our retirement savings free and clear forever. let's talk about free and clear. how many of you own your own home free and clear, no mortgage? how many? isn't that a great feeling? isn't that one of the greatest feelings of pride and accomplishment in america? to own your own home free and clear. i remember my dad, when he paid off his mortgage. back in 1957, in the house i grew up in,

he took a 30-year mortgage for $12,000. 30 years for $12,000. that was common then. he paid it off in 1987, 30 years later. remember when people in your neighborhood paid off their mortgages? we had mortgage-burning parties. anybody remember that? it was a big deal when you owned your own home free and clear. well, why don't you think the same way about your retirement savings? for many of you, your iras, 401(k), might be larger than the value of your home, yet you don't think of that being free and clear. don't you want your retirement savings to be free and clear also? let's take a little example. let's say you have a home that's worth $500,000 and you have a $200,000 mortgage on it. that means you have equity of $300,000. how do you own your home free and clear? if you pay off that $200,000 mortgage, you own your home free and clear.

does that make sense? all right, let's switch the example. let's say you have an ira of $500,000. what's the mortgage on that? we don't know yet. that's up to the government, based on how much money they will need when you reach in for yours-- based on their plan, based on their time table. they have all the advantages. that's not fair. just when you need it, just when you reach in your hands at retirement and want to pass it on to loved ones, that's when they jack the rates up based on how much money they need. it's like getting in the end zone and then they move the goal post back ten yards. that's not fair, is it? >> crowd: no. >> no, that's not fair at all. that's why you have to create your own plan to buy off uncle sam to have a free and clear retirement. and when is the best time to buy off your partner? what are the optimum conditions

if you want to buy out a partner? as soon as possible for the lowest cost possible. doesn't that make sense? you want to buy out uncle sam at the lowest cost possible. this is a husband and wife thing. what does it mean when your wife comes home and says this: "you're not going to believe how much money i saved you today." all right! she got it on sale. but that's true. it's the same thing with taxes. right now, taxes are on sale like they've never been before. you don't know how good you have it now. tax rates are as low as you may ever see it in your lifetime. taxes are on sale. taxes are on sale. rates are low. values are low. this is the time to move your money from accounts that are forever taxed to accounts that are never taxed. this is how you create your plan, not the government plan. remember, in an environment of rising tax rates,

you want to get your money out of the clutches of the government. you want to move your money from accounts that are forever taxed to accounts that are never taxed. that's how you stay rich for life! [applause] coming up: i'll show you two ways to buy off uncle sam as the senior partner on your money so your savings can be free and clear forever, tax-free forever. i'll show you how to move your money from accounts that are forever taxed to accounts that are never taxed. but first, please pick up the phone and call this station with a generous pledge of support. then i'll be back soon with more stay rich for life! thanks. >> we are so fortunate to have ed slott with us, and i have to tell you why: because the wall street journal, okay-- the wall street journal-- says about him that "ed slott is the best source of ira advice."

i mean, that is just phenomenal, and we have the opportunity to share ed with you. i'm laura savini. and, ed, i have to say thank you to you formally, because, you know, we were in trouble. public television is having a lot of trouble right now. and i called you up, and i said, "ed, i know you've done a lot of this, but can you help us?" and you were really very generous and worked out something with us here so that we can offer you this kit at an unprecedented level. ed slott has a kit of three dvds and three books. it really represents his career, his 25 years as a cpa, all of the work he's done. it's all in this one kit. and we are able to offer it to you at a level of $125, the reason being is because we want you to have that information so that you can better prepare, and we want you to be able to call and support us here during this time when it's a little bit shaky ground for public television. we're getting cuts all over the place. so ed said yes, and here he is.

that's the story, and thank you for that. >> i'm happy to make this available, especially for a gift to a station, your station, this station that needs it more than ever. for a gift of $125, you're getting my life's work in this-- it really is; it's something-- because i want you to have it. it's all about education. that's what financial security is: having the education to make the right choices, to expect and demand more from your financial advisors. and there you see it. it has, obviously, the dvd of the program you're watching, stay rich for life, with bonus material, questions and answers. and then we have other dvds: weathering a financial storm, what happens if you've lost your job. i take you through all of those options which many people are grappling with now. and your beneficiary guide. and then i have the program guide right here.

this has a summary of every item on every dvd. and then we have, of course, the hardcover book stay rich for life, which has substantially more information. and then we sum it up with the piece that helps you put it into action, the stay rich for life workbook. it's not only about knowledge. it's putting your knowledge into action. that's how you get your plan, not the government plan, on your timetable, not the government's timetable. but the only way that it's going to happen for you is to get this special deal through public television by making that call and supporting this public television station. this is unbiased information. you're not going to see this on any other station. yes, there are some other financial stations where you can see shows, but they're always selling something. just so you know, i don't sell stocks, bonds, funds, life insurance, annuities. i'm independent, unbiased. i'm a tax advisor; i'm a cpa,

here to help you make the most of what you have left. it's about keeping and protecting what you have left from greater forces than wall street: the taxes. it's all going to come down to the taxes, and that's something that you can control. remember, wall street, it might be out of your control. it goes up; it goes down. even great financial advisors have lost lots of money. but you can control the taxes. and with these strategies, which anybody can use, but most people don't know about it; most financial advisors don't know about it; i give it all to you: 25 years of my career in three dvds and three books so you'll have it all, and you'll use it. there you see the stay rich for life kit. you make that call at a gift to this public television station of $125-- i have to laugh every time i see it--$125. you know, you couldn't get your taxes done by a bad place for that kind of money.

there you see it: the three dvds and the three books. what a great deal. and you'll be helping such a great cause: education where lifelong learning begins, on this public television station. >> you know, i have to share a story with you, ed, that is rather alarming, that when this information's available to you-- i mean, you can turn on this station and find out very important things about managing your future, right? well, here it is. public television puts it out there. and a friend of mine just passed without a will, and right now, the government is-- his business, everything, is really being lost. and it's heartbreaking to me to see that happen when we have the information available. >> can i tell you one of the biggest mistakes people make? it's those people that have a will and think it's covered in there. these are the biggest mistakes i see, where people though someone else took care of it. so you just heard laura talk about somebody that didn't have a will; that's awful. but even people that do have a will mess this up. remember, we're talking about your retirement savings.

the best tax options are outside the will through beneficiary forms, which many people don't know to check, checking beneficiary forms on retirement accounts, company accounts. what if you've had a divorce or you had a new child? you know, things have changed in your life--remarriage. these things have to be taken care of. that's why i take you through all of this in the stay rich for life workbook, which i think, i believe is the crown jewel of this incredible stay rich for life package. for a gift to this public television station, if you please make that call now, you'll be supporting at the $125 level two great causes: public television programs like this that are all about unbiased education and lifelong learning and supporting you and your loved ones so you will have financial security, because that's something you can control. >> and it's a fact that right now, this public television station needs you. it's important that we do hear from you

so that we're able to continue doing the work that we do, which is bringing you the programs that really make a difference in your life. so it's very simple right now. you make a call, whether it's $50 for the dvd of the show, or just bump it up to $125, and you get this package of the three dvds and the three books that really give you step by step everything you need to do. and like ed said, that workbook really guides you through everything in the package, so you get it, and you know how to immediately put this all to work. so the big deal is, though, to make the call, make the move. don't just sit back and watch. make a difference in your own life and in the life of this public television station. so the phones are going well. >> yes; now is the time. >> so this wasn't such a crazy idea. >> this is one of those opportunities that the time is now. >> that's right. that's right. so take advantage of having the universe's most foremost authority on iras and 401(k)s. he's here with us, and now it's up to you to use that information to your own benefit and to support this station.

the number's there on your screen, and you can pledge online. give us a call-- $50 for the dvd of the show. $125 pledge, we'll send you the whole kit. >> the stay rich for life kit. >> i love the stay rich for life kit: three books, three dvds. it's all there. so why don't you give us a call right now? i'm laura savini, and this is ed slott. male announcer: welcome back to stay rich for life! [applause] >> all right, let's recap. let's see what we've learned. taxes are going to go through the roof, and we have to plan for it. government is broke. business is broke. you're on your own. we have to start moving our money from accounts that are forever taxed to never taxed. and now i'm going to give you two ways to do that. what do roth iras and life insurance have in common?

they're both ways of moving taxable money into the tax-free side of the ledger. remember, in an environment of rising taxes, you want your money in the tax-free side. so when rates start going up 50%, 60%, that's where you want your money. can you imagine the value of an account, of a tax-free account, when rates are 50%, 60%, or even 70%? roth iras and life insurance are two of those golden nuggets in the tax code that can make that happen. first just a note on the life insurance, i don't sell life insurance. i don't sell stocks, bonds, funds, annuities. i'm a tax advisor, unbiased. i'm giving you information for you to crack the code, to use the tax code to your advantage so you can have your plan, not the government plan. i encourage everyone to start converting iras and 401(k)s to roth iras. not everybody can do it. in 2009, if your income exceeds $100,000, you can't do it.

but that all changes in 2010. in 2010, all those rules go away. everybody qualifies for a roth conversion in unlimited amounts. but there's a kicker. you have to pay for it now. and that's what you have to address. yes, to get money into a roth, you have to pay tax up front. and a lot of people don't like paying before you have to, especially people like me, accountants, cpas. they hate the idea of paying taxes before you have to. cpas are hardwired. we're trained to always defer. never pay a tax before you have to. that's why i'm a recovering cpa. [laughter] paying taxes is painful. who wants to do that? for example, if, when you were a kid and your mother told you to do something and you said, "not now, ma. i'll do it later," you would have been an accountant because you were trained to defer. put it off. i'll do it later. putting it off till later is not a solution because the problem doesn't go away.

the problem doesn't go away. the tax doesn't go away. the tax in an ira is like a cancer on the account. it doesn't go away. it just gets bigger and bigger and worse as tax rates increase, as values increase, until it consumes and wipes out your ira. so that's not a solution. the roth ira is powerful, but you have to look at paying tax now. look, anything good in life, if you think about it, you pay for up front. it's always the bad things you pay for, much more, later. that's not what you want to do. you want to encourage getting all moneys in roth iras, roth 401(k)s at work. and with a roth conversion, there's no risk. it's one of the great second chances we have in the tax code. in fact, you get do-overs. it's called a roth recharacterization. let's say you converted your ira to a roth ira in 2009.

if you convert in 2009, you have until october 15, 2010, to change your mind for any reason you want. it's like getting to bet on a horse after the race is over. and during your lifetime, you never have to take the money out, not like a traditional ira or a 401(k) where you have to start pulling money out after 70 1/2. real wealth builds fastest when it's not eroded by the government. but i said there were two ways. the second way is life insurance. life insurance is the single biggest benefit in the tax code, the ability to put small amounts of money in and have many times, many multiples of that, come out tax-free forever. switching from taxable accounts to tax-free accounts. life insurance is incredible. most people don't use it, but they should, because it's a wealth-building tool. it's the way to move money from forever taxed to never taxed. you might say, "why would the government even allow that?"

it actually sounds too good to be true. why would they allow it? you might say, "well, the government "needs all this money. why would they keep that huge exception?" it's a social reason. why do you think the government gives us so many benefits for giving money to charity? you give money to charity; you get a tax deduction. why does the government, through the tax code, encourage us to give money to charity? why do they want us to give all our money to charity, do you think? so they don't have to. because they're broke, remember? they're broke. so they don't have to. so they throw us a bone. we get a tax deduction. and we're happy, and we give all our money to charity. it's the same thing with life insurance. the government wants us to take care of our family so they don't have to. they want us to take care of our family with our own money, not government money, with our money partnered with life insurance company money and leave our family with much more than we ever had

tax-free. they want us to take care of our family so we're not a burden to the government, so our family's not a burden to the government so the government doesn't have to do it. here's how i work this out. here's how i do this kind of planning in the real world. a couple might come into our office. and let's take a typical couple. they've worked hard, saved their money their whole working life, maybe 50 years. and they've built up $1 million in their retirement account. and it's a husband and a wife, and let's say they have a daughter, 40-year-old daughter. that's the family story. and chances are, they have a house. so they have a house and this $1 million ira, and that's about it. and chances are, the plan they have when they came to see me is, let's say the husband has the $1 million ira, so chances are the wife is the beneficiary. that's what most people have, and that's okay. and then they come to see me. first thing i say when i get all the facts and figures and find out about the family, i'll look at the wife in this case, and i'll say, "do you love your daughter?"

"of course i love my daughter." good. here's what we're going to do. we're going to take you off as the beneficiary on the ira, and we're going to put your daughter on there. why? tax-wise, she'll be able to pass it through the estate exemp-- she'll have it estate tax free. and because of her young age, only 40 years old, she can stretch a great benefit in the tax code, another one of those golden nuggets, she can stretch or extend distributions-- i call this the great parlay of wealth-- extend distributions out over 40 years, over her lifetime. she will be worth millions. at some point during this conversation, the wife will say something to the effect of: "over my dead body." and that's where i like to pour some gasoline on the fire. and i'll say something like: "what's the problem?" "what's the problem? what's the--it's all the money in the world!"

"yeah, but i asked you. do you love your daughter?" "yeah, i love my daughter, but i want the money!" [laughter] that's not really what she wants. what she really wants is financial security. she's looking at that ira, he or she, whoever the spouse is, and they think it's real money. so here's what i say to the spouse in that case: she says, "i want the money." i said, "what money? that ira?" that's what you want? that horrible, disgusting disease, that tax-infested account? that's not real money. that's loaded with taxes. there's a mortgage on that. we don't even know how much that will be. it will be determined by the government when you need it the most, when you're the most vulnerable. the taxes could be 50%, 60%, 70%, and even if you don't need it, you might be forced to take it out after 70 1/2 at whatever the prevailing tax rate is then. you might be left with some crumbs. that's not real money.

if you want real money, here's what we're going to do. instead of the ira, we're going to take out-- you want $1 million? a million-dollar life insurance policy on your husband. he dies; now you get real money, because when you inherit that $1 million of life insurance, it's estate ta real money to me is spendable money where you can spend every cent. that's real money. and then, after i explain that, the wife might say, "but where are we going to get the money for the premiums?" i said, "well, it's going to come out of the ira going to your daughter." "oh, well, that's okay." got to establish a little relationship there first. and here's what's going to happen. you don't to make yourself poor over this, and whatever the daughter gets is gravy. you're going to get $1 million, real free and clear money, spendable money, tax-free money. the daughter, your daughter's going to get whatever's left of the ira after paying premiums

and living expenses. out of the $1 million, maybe it'll only be $400,000, $500,000, $600,000, whatever it is. that's what she's going to get, but she'll still get it all estate tax free, and whatever she gets, she'll be able to stretch over her life expectancy and still turn that into much more than you could have using that great parlay of wealth, the stretch ira. that's a perfect plan. but even then, in this situation, even after i explain all this, sometimes the spouse, the wife in this case, might say, "you know, this sounds good. "i get the $1 million of life insurance. "what if i need more? "in these economic times, who knows what i'll need? it may not be enough." i've found that when i've done planning with people, that if there was something keeping them up at night, that plan wasn't getting implemented. so here's what i would say to the spouse. if this is bothering you, if this is keeping you up at night, let's change the plan. we'll keep the life insurance.

but we'll switch it back and make you the primary beneficiary. the only thing i'm going to change is, i'm going to add your daughter as contingent beneficiary on that life insurance policy. now you're in control of everything. that's a great plan. your husband dies, you get $1 million life insurance tax free, and you get the ira. now, at that point, you might say to yourself, "well, maybe he was right. "maybe i don't need the million of ira and all the problems with the taxes." and now you're more inclined to say, "i wish my daughter could have that." but there's another golden nugget in the tax code called a disclaimer. because you named your daughter contingent, you can disclaim or refuse the inheritance. why would anybody refuse an inheritance? because it's going to go right back in your family and create a better tax picture for everybody. so you can disclaim all of the $1 million ira or any part of it. let's say for our example you disclaim $1 million. to disclaim, it has to be done within nine months

of the date of death. so you do have some time to see how much you'll need and even have the flexibility of changing the plan a little even after death when you know exactly how much you need. so let's go back to the story. let's say the wife disclaims the million. she--the million ira-- because she knows she has the million in life insurance, which is much better. she disclaims the million ira. it goes back through the husband's estate to the daughter so the daughter gets it estate tax free. the daughter moves up because she was named contingent beneficiary. and that's very important in planning. because she was named the contingent beneficiary, she moves up as primary beneficiary and inherits as if she was the primary beneficiary all along, still gets to take it over the 40 years. that's how you get the best of both worlds. it's not only using the biggest benefits in the tax code but getting the biggest bang for the buck from them. now, i said "more, more, more" many times. that's how you stay rich for life!

but anybody thinking, with this insurance, "i don't get it. "where's my more, more, more? "the way you're explaining it, "it sounds like, with this life insurance, "i just pay everybody and then i drop dead. what's in it for me? where's my more, more, more?" anybody thinking that? a lot of people think that. your more, more, more is in your ability to enjoy your own money, to get over your self-imposed restrictions of enjoying your own money. it's a big problem for a lot of people. they can't enjoy their own money. you worked for it. you saved it. now it's time to enjoy it, and it seems, as people get older, they're less inclined to enjoy their money because they're so busy sacrificing and saving for their kids and grandkids that they can't enjoy one cent of their own money. i call this the martyr syndrome. here's how it develops. i may have an older couple come in, and they come in with their adult children. say their children are even 40 or 50 years old already.

and they come in, and the first thing they say... they say, "you know, we haven't eaten in 30 years, "because we want to give you a great life. "we didn't have fancy houses with big mortgages, fancy cars. "we walked uphill to school and uphill back. "we didn't have fancy shoes. "we didn't even have feet. "we had nothing. "and the reason we're here today with mr. slott "is that we want to continue not to eat "and deprive ourselves for the rest of our lives so you can have it all." that's what i call the martyr syndrome. so here's what i'm saying to you. these are self-imposed restrictions on your own money. let's say over your whole life, just to use a round number, you built up a net worth of $1 million, which you can't touch because you refuse to let yourself enjoy your money, right? let's peel off just 5% or 10% of that,

5% or 10%, put it in a life insurance policy. this way, you die; your kids get millions more than you ever had, all tax-free. you don't have to worry about them anymore. they're taken care of. so what does that mean for the rest of the money, the 90%, 95% that's left? you can spend it. you can enjoy your money. what i'm telling you is: you can eat again. [laughing] you can eat again. you can enjoy your money. it's okay. you don't have to save it for anybody. they're taken care of. enjoy your life. enjoy your money. take a limo ride before the last one. be like the guy who said, "95% of my money, "i spent on wine, women, and song. the rest i squandered." enjoy your money. that's how you get more, more, more. let me give you a real-life example of more, more, more.

this is actually a client that we had. 12 years ago, they came in to do their planning. we talked about the things i just talked about with you: creating their plan, not the government's plan. we recommended life insurance. again, i don't sell it. i'm telling you based as a tax advisor using the tax code. we recommended life insurance. we recommended long-term care, checked beneficiary forms, see how they own their assets, the good planning that we do for all of our clients. they came back 12 years later. so we went through our notes, took out the notes. they were sitting there, and i said, "did you do the life--" "yes, we did the life insurance," did the long-term care, checked beneficiaries. they did everything. they were the perfect client. i'd never even seen a client that good before. they did everything we told them to do. and then the wife broke down. and she said, "the reason we're here is that things have changed." they were both ill.

in fact, they were both terminally ill. and she said, "the reason we're here is, "we want you to know how thankful we are "that we did what we did 12 years ago "because we couldn't do it now. "we know now, whatever time we have left, we can enjoy it. "we can enjoy our moy now. "our kids are taken care of. "our grandkids are taken care of. "no matter what happens to us, they will be taken care of, "which means every dime that's left, we can enjoy. whatever time we have left, we can enjoy that money." and they are enjoying that money. they said, "we take trips with our kids and grandkids. "we help pay for school. "we're enjoying every cent of the moment and the money right now because we created a plan." that's what i'm talking about: more, more, more. they created their plan on their terms, on their timetable, and that's how their family ends up with more, more, more.

that's how you stay rich for life! [applause] coming up: i'll show you how to put it all together with a powerful five-step plan that will get you on track to keep more of your money, keep it free and clear so it is real money that will take care of you and your loved ones and help you stay rich for life! but first, please pick up your phone and call this station and become a supporter of all their great programming. they have some wonderful ways to say thanks. thank you. >> hi, i'm laura savini. and obviously, there he is, the master of the 401(k), ed slott. thank you for being here with us, ed. it is wonderful that you share your expertise like this with the public television audience. and i have to tell you, it's very important for you to know first off that a lot of times, when you meet someone like this, they're selling you a product. they're selling stocks, or they're selling insurance or advice or whatever it might be. but ed slott, you don't sell things. you are basically a consumer advocate.

>> really, i'm on a mission to match consumers with competent financial advisors so you can get more, more, more, so you can be better educated, so you can make better choices. i want you to have this information. that's why i put this show together, and that's why i was able to get it to your public television station, this station, at a gift of $125. you make that phone call, you get literally a collection of everything i've ever seen, my life's work. there are huge benefits: peace of mind, getting your questions answered, and getting a plan. it is so important that you get a plan. i brought this to public television because this is the best place to find unbiased education, correct, accurate information. you're not gonna get that on other channels. they are always selling things. i don't sell stocks, bonds, funds, insurance, annuities. i'm a tax advisor. and financial security, there is no question about it,

is based on how much you can manage the taxes. it's all going to come down to the taxes. if you're saving for retirement, it's all about managing the taxes. public television needs your help. that's why i am here. i am hoping you make that call and support public television. and in return, i've put together this stay rich for life kit for a $125 gift that i know will pay off probably thousands of times and for years and years, for you and your loved ones, your children, your grandchildren, all because you made that call today for the stay rich for life kit. >> now, i don't want you to feel overwhelmed when you look at this and you see three dvds and three books, because i have to tell you, it all starts with this, with the program guide. and this is really a great idea, what you did. it's basically the transcripts of the dvds so that as you're watching-- because i don't know about you, but i need reinforcement when i'm watching something, when i'm learning so many things at one time. so as you're watching, you can take notes--

roth ira-- and take notes of things, of action points of things you need to do. this will guide you through all the pieces. and i was noticing your bonus dvds... >> yes. >> growing & protecting your money in turbulent times. >> well, that's the dvd of the program, and that's what you're going to get: this program with additional footage, some questions and answers from the audience, and then another special dvd i put together, weathering a financial storm. >> perfect time, perfect time. >> look, everybody knows somebody who's lost a job in this economy. wouldn't this be a great thing to get for somebody you know who's in need of this information? look, you've just left your job. you have a 401(k). it's critical what you do now. this money can be lost instantly to taxes if you don't move it the right way to an ira, if you don't know about many special tax breaks, including something called net unrealized appreciation for company stock benefits. it's all in here. this is just one of the six pieces

to this stay rich for life kit. this is called weathering a financial storm, what to do, with special emphasis on what to do when you leave your company with that 401(k) so you'll get your plan, not the government plan. so if not for you, give it to somebody who may be down on their luck. what a great thing you can do for somebody else and help them get more, more, more-- remember, more money for you to enjoy now, more for your retirement, more for your loved ones, and more of it tax free. but it only begins when you make that call to this public television station. i want you to have this information so you can take control of your own financial security. and the reason i brought this to public television and nowhere else: i know public television viewers are always the most educated. i've met many of you around the country after my last public television special. we had seminars all over the country, and i can tell you this: public television viewers are the most educated,

the most generous, the most giving, and the most family oriented. and you'll get so much out of what i put together, and you'll be supporting your community and this public television station. this is an unprecedented opportunity. i don't know if it'll ever be offered like this again. i'm here because public television needs help. they need help right now. make that call and help out. >> you know, one of the things about public television is, we really have a legacy of great teachers, of having people on the air with us that are able to impart information in a way that is memorable to you, that makes an impact on you. so i think about, spiritually, we've always had deepak chopra and wayne dyer, and they've helped so many people, really. and science--think about when you're learning science on public television you have a show like nova. you think about learning history. where else but with american masters and the ken byrnes documentaries? so we're bringing to you the authorities. so what we've done now is brought you

the authority on retirement planning, because that's something everybody needs to do. there's nobody that can get away without planning for your retirement, or you're in big trouble in your later years. so we turned to the guy that is the expert's expert. you read the boston globe; you read the washington post; you read forbes magazine, wall street journal. from the national publications to the city papers, ed slott is quoted. if you don't believe me, google it. check it out. you're going to find ed slott everywhere. and that's why, when the opportunity came up to have a show, to present a show with ed slott, we were like, "yeah, of course we're going to do that." and of course we are grateful that ed has shared his time and traveled all over the country, meeting you, working with you, and sharing this information. and the thing about him being a great teacher is that he's funny. ed, that's why, when i watch your shows, i actually--i'm laughing. >> you actually came to our seminars. >> oh, and it was--you were so much fun to watch live, and the audience loved it. they came there with their lists of questions, and it was really a wonderful opportunity for everyone.

now, not everyone can get to an ed slott seminar. that's not gonna happen. but we've got the show. we've got the dvds. and you use that same sense of humor, which i think is brilliant. i don't know how you incorporated that into your teaching. >> well, i've got to tell you, i've learned over my career, death and taxes could be a dry subject. it could be. i'm not saying it always is. it could be. this livens it up. even the dvds, as you see, they're all reinforced with stories. and i've heard a lot of great stories from all of you when i'm on the road. when i see you, you know, i realize we're really touching a financial nerve. this is what i--i'm getting this from everyone i've met at public television seminars around the country. i always get the same thing: "why isn't my advisor telling me about this?" i'd question the same thing. most people who call themselves financial advisors, i think you know already, are really just financial salesmen. they're selling you stocks, bonds , funds. that's not good enough.

you can't have these companies walking around with million-dollar bonuses, and you're left holding the bag. you lose money. they get money. that's unacceptable. i'm here for you. i don't care if, you know, some of these financial advisors might be upset because i called them salesmen. too bad. i'm not here for them. i'm here for you. this is unbiased information, and it's only on public television you'll get the truth about this. but if you make that call, you'll get the entire stay rich for life kit. i don't sell stocks, bonds, funds, insurance, annuities. i'm a tax advisor, and this all comes down to managing the taxes. remember, when it comes to your retirement, our tax code is a penalty on savers. but i show you how to mine that tax code to end up with more, to get peace of mind, to get your questions answered, to raise questions you didn't know to ask, to demand more from your financial advisor, your financial planner, your accountant, your attorney who may not know enough about this. i show you, in fact, in the workbook,

how to find--and in the stay rich for life book, two pieces of this fantastic package-- how to find an advisor who is up on all of this, and there are some, not many, but i show you how to find them. i show you how to find advisors that have specialized knowledge. i hope your advisor is one of them, but if he or she isn't, you'll know it from this material. >> and you're seeing all the pieces of the kit right there come into view, the three books, the three dvds, the workbook i was telling you about, so everything's in one place. you pick up the book, and there's everything in your workbook and this is unprecedented to have a package like this put together and for it to be offered as a way that's a win-win situation. so you win because you get all of this; you get organized. and you win--it's a win-win for you because you also win because your public television station has the opportunity to have your gift so that it keeps healthy, so that we're able to continue putting the programs on that make a difference. so it's really a great thing for everyone.

and the station wins because we have ed slott to share with you. so all around, it really is a wonderful thing. >> i am happy and proud to be here, and i hope you make that call and support this public television station. they need the money. that's why i put all of this together. it may be a once-in-a-lifetime offer; i really don't know. but now, if you make the call, you'll get it all. you make the call-- i like that. if you make the call, you get it all. >> hey, we're gonna get ready to go back to the show. >> okay. >> what is in the last segment? >> oh, great. we wrap it up. i show you my five-step plan for lifetime financial security, coming up. >> oh, great; well, we are going to want to know about that. so now, here is your final opportunity before we get into the show and you get distracted. make the call right now to that number on your screen, or pledge online. more of ed slott coming up. male announcer: welcome back to stay rich for life! [applause] >> all right, thank you. welcome back. let's recap where we started and where we are right now.

we started talking about the big tax problem. remember, taxes are going to go up. our government is broke, and you're on your own. and where most of your money is, in iras and 401(k)s, that money hasn't been taxed yet, so we have to create a plan to move that money from accounts that are forever taxed to accounts that are never taxed. we want to get rid of our uncle sam as partner, senior partner, on our life savings. and to do that, it's going to cost some money now, but you pay up front for the good things in life. it's always the bad things you pay for a lot more later. we want to buy the tax rate while it's on sale. and i gave you two ways to do it: roth iras and life insurance. and now i'm going to put it all together to get you to take action and create a plan. i'm going to give you a five-step plan to make sure this gets done. here are the five steps. step one: know who you are and where you are.

step two: get educated. step three: avoid mistakes. step four: don't be shortsighted. take the long view. and step five, the most important one that sums all this up: take action in small, consistent steps. let's go through them. if you're starting any journey, you have to know who you are, where you want to go. it's different for everybody. everybody has a different time horizon. it's different if you're 25 than if you're 75. everybody has a different risk tolerance. for example, only two kinds of people come off a roller coaster, one that says, "what a rush. "oh, that was great. i want to do that again," and the other that throws up. you have to know which one you are. i can see from your reaction, many of you already have made that decision. you have to know about your family, people you care about, people you want to provide for. when i do planning, a lot of parents say to me,

"you know, it's not my kids i'm worried about. it's the ones they marry." [laughter] that is true. all right, so this is something you know you need to address. maybe you have a charitable legacy. maybe that's something you want to do. maybe you have some kids that are, i don't know, not so good with money, maybe spendthrifts. i'm reminded of a story from a taxi driver. he said, uh, he says to this guy, he says, "you know, your son tips much more than you do." and the guy says, "that's because he has a rich father. i don't." so you have to know where everything is. you have to know who your players are. you have to create a plan. this is a great time to have a family meeting about money. it's okay. people don't like to talk about it, but luckily, the silver lining of all the volatility in the economic crisis, it's in the paper every day. it's on tv every day. now it's the natural topic of conversation. so talk about it. let your children know where everything is,

where you want it to go. otherwise, you don't have a plan. and if you don't have a plan, they'll get less. the better your plan, the more they'll get. if you don't plan, you will have less. not only that, after death, if you don't have a plan, a lot of the money is not only going to be lost to taxes but to other professionals: lawyers, cpas, financial advisors trying to figure out what you had in mind. know who you are and where you are. and that leads to our second step. you're going to find with these five steps, they kind of flow nicely into each other. the second step is: well, now that you know who you are and where you are, you're more likely to say, "i want to know a little bit more about this." and you're more likely to get educated. if you get educated, you're more likely to make the right choices. the better educated you are, the better choices you'll make. you'll demand more from your advisor. you'll have more money. the better educated you are, the more money you will have.

you will demand much more from your advisors. you know, in this area, you need an advisor that has specialized knowledge in this area, managing the taxes. most don't. you have to know that your advisor knows. i'm not telling you to get educated so you can be a do-it-yourselfer and do this all yourself. that's not what i'm talking about. for example, you go in for an operation. you'd like to know that the surgeon once read a book about it, maybe went to a course one time--one time. this is a financial operation. you want to know that your advisor is not just a salesman, has invested in his education. my dad once told me: "the best investment you can make is in your professional education." ignorance is too expensive. you want an advisor that invests in his professional education. there's a difference. some people call themselves advisors, but they're really just salesmen. you can get stocks, bonds, and funds anywhere.

anybody can sell that. those are salesmen. you want a true advisor that has invested in his education. it reminds me of a yogi berra story-- yogi berra, the famous baseball player. he said early on, he was not so-- he didn't do too well in school. and he said, one time, the teacher said, "yogi, do you know anything?" he said, "i don't even suspect anything." you want an advisor who suspects something, who wants to learn something. you want to work with somebody that knows more than you. you ever go in for a major purchase? you're going to spend a lot of money. maybe it's an appliance, a tv, even a car. and you go in and within 15 seconds in the conversation with the salesperson, you start to realize you know more than him. that ever happen to you? how does that make you feel? you're going to spend a lot of money. don't you want to work with somebody who knows more than you? well, do you think a person's life savings

is a major purchase? is that a major purchase for you? you want to work with somebody who knows more than you. the better educated you are, the more you will demand from your advisor and he or she will be better educated. the less likely you'll just blindly take any sort of advice. also the less likely you'll be subject to whatever the last conversation was that you heard. you ever hear--you know people like that? their opinion is whatever the last thing they heard was. because they don't have the background, the education. you want the education so you can make the right choices, end up with more money. that's the bottom line. how do you get educated? you find out all you can about the subject. you read from many sources. you go to many seminars. you seek several opinions, go to many advisors, and look for unbiased advice. you need to get educated so you can make the right choices and end up with more money. and that leads to step three:

obviously if you're better educated, it's more likely you'll avoid mistakes. some of the biggest mistakes are tax mistakes. you can lose chunks of your retirement savings to tax problems. remember, the market goes up and down and up and down. it goes up, you make money. it goes down, you lose money. it comes back up, you make money. you get it back. if you lose it to the government, you'll never get that money back! you don't want to make those mistakes. one of the biggest mistakes is: people think someone else took care of it, like your beneficiary form. that's the most important document you can have. i talk about it on every show i've done, in every seminar, every presentation. yet it's still an epidemic. this is the one document that will determine