So here are the 2 battles you have to win: 1) the inflation battle, you’ll see why in a minute,

and 2) the tax battle, because it’s not what you make, it’s what you keep. Taxes will hurt you if you’re not careful.

Let’s talk about inflation. Have you heard of the rule of 72? Let me explain it, it’s really interesting. Whatever interest rate you’re saving at, say 4%, divide that into the number 72, that will tell you how many years it will take for your money to double. 4 into 72 is 18… every 18 years your money will double. Draw the following on a pad of paper: 72 / 4 = 18 years Here’s the example. Let’s say you have $100 in an account that earns 4%. If you leave it and it just grows at 4% in 18 years it will double to $200. What happens in another 18

years at 4%? Right, it doubles again to $400. Here’s the problem… 36 years from now will $400 buy what $100 does now?  Draw the following on a pad of paper: $100 @ 4% 18yrs = $200 another 18yrs = $400.

That’s inflation.

(Name), if people are saving then where are they saving? Banks, credit unions, fixed accounts, etc. where they’re probably not even getting 4%, you can see what’s

happening. Money is growing but inflation is growing much quicker. They’re losing purchasing power, and they may never retire… and that's a really big, big problem.

(Cover up everything but the 4% example)

Let’s assume you are 29 years old and you have $10,000 @ 4%. 4 into 72 is 18, so that

$10,000 grows in 36 years to $40,000. You’re 65, the kids are gone, the house is paid for, and you want to retire, but you’ve got $40,000 to your name. How long is that going to last you? The way you spend, probably half that time, just kidding. Maybe a year,

maybe a little longer if you’re really frugal, and then you’re out of money and you’re a greeter at Wal-Mart. But, here’s the problem, we’ve run out of time, who wants to work past 65? The only thing we could have changed is the interest rate, and here’s the

million-dollar question. If you could have had 6-12% instead of 4%, would you now have greater financial independence? The answer is yes.

(Throw your pen down and say,) Isn’t that amazing! The only difference between this guy and that guy is the interest rate, not more money, or more time. Same age, same amount of money… the only difference is the interest rate. But it cost this guy SIX, HUNDRED THOUSAND…dollars.

Now at this point I know that a lot of people are thinking wow this looks good, but I don't have $10k.  It’s not about having $10,000 (name), the key is systematically putting a away little bit on a monthly basis at a decent interest rate and be protected against any losses.

If you will save, FOR YOU, at a decent rate, there could very well come a time where your money is out earning you and not the other way around. Isn't that pretty awesome?

The third way is the indexed strategy, where all the principal you save and all the interest earned is also protected so you don’t lose money. All interest earned is linked or indexed to what the S&P 500 stock index does, which for the past 25 years has averaged almost 10 % a year!  

Of these 3, which one makes the most sense for you? The indexed strategy? That's my favorite too and it’s a VERY popular strategy. 

You’ve heard of the S & P 500 index right? The S & P 500 stock index is the 500 most widely held companies in the US representing over 100 industry groups, such as

technology, health care, utilities, etc. In fact the S & P 500 represents almost 70% of the total domestic equity market capitalization, about 70% of the American economy.

So the way this works is that whenever the S&P 500 goes up you earn that much interest right up to a cap, for example 10%, but whenever the index goes down your protected because you don't have any money directly in the stock market.

So you see your money is protected from any market loss, at the same time you participate in the growth of the S & P 500 up to a cap, for example __%, with the

protection from any downside market risk. That should be pretty important, don’t you think?

(Draw this out on a piece of paper as you explain it) Here’s an example. Let’s say that a few years back you contributed $10,000 in the indexed strategy, and let’s say the S & P 500 did 10% the first year. Now it has grown to $11,000. Let’s say the second year it

grew another 10% and now you have $12,100. In the third year the S&P loses 20%.

Is that possible? Absolutely, in fact it happened. But now instead of your account value dropping 20% to $9600 in year 3, it remains at $12,100.

Let’s say 30 years ago there was a guy that was 30 years of age and he wanted to have a million dollars when he was 60. Now, he didn’t understand any of this, so he just goes into the bank and says, “Mr. Banker, what do I need to save, every month for 30 years, so that I can have 1 million dollars?”

(Back then CD rates were about 5%. Now they are about 2 or 3, but then they were at 5.) Well the banker figured it out and said, “What you need to do is put away exactly $1639.29 a month for 30 years at 5% and you’ll get your million. Well, he was totally discouraged and he left the bank and never saved a dime. He’s now a greeter at Wal-Mart. We’ve seen him, right? Now what if we could have taught him how to win these two battles, the rate of return battle and the tax battle?

Look at how it drops that number… it’s almost unbelievable! Let’s win one at a time. The rate of return. Even though future performance can't be guaranteed let’s say he could have averaged 10% instead of 5%, it takes the number clear down to $900 a month.  However (name), can most people save $900 a month?

(Wait for a response.) Probably not, however that’s $700 less than that guy. That’s significant, right?

Now, what if we help him to put his money away where it can’t be taxed while it grows. So with tax deferral, what does he have to put away? Look at that, $438 a month. Now (name) do you know people that can put away $438 a month? (Wait for a response.)

Yeah, a lot of people. Maybe you could do that… hey, you’re probably blowing that, right? See, to a lot of people, that’s not a big deal. See, it’s not so much putting away a ton; it’s about putting away what you can, at a decent interest rate, reducing taxes, and avoiding loss of principal.

(Name), let me ask you this. If you were financially independent right now… and you had enough in your nest egg so that every month you had enough that you didn’t have to go to work anymore, what would you and your wife be doing? What are your dreams; what are your goals? What would you really like to be doing?

(Wait for a response.) That’s great! Now think about it. If you were financially independent, you have options, and that’s the point. You can do what you want, when you want, how you want.

In fact, it was interesting, the other day we went through the implementation phase with a client… that’s our 2nd visit… and the wife was so excited. She gets up and says, “You know what, I could go door to door asking my neighbors when they were going to be financially independent? You know nobody would know. But I do.”

You know what? At that time she and her husband became one (pause). Because they knew what their

dreams were and when it was going to happen. So it’s exciting! That’s step 6.