All winter, we’ve been buying tomatoes. Now that Spring is finally here, we’re growing our own. I bought a pack of seeds in January for $.65, plus $.04 in sales tax. According to the package, I’ll get about 100 pounds of tomatoes this summer.
The same 100 pounds of tomatoes at the grocery store would cost about $14.00 in sales tax. So for the exact same thing – 100 pounds of tomatoes – I paid $.04 in tax on the seed; or $14.00 in tax on the harvest.
As investors, we’re farmers of our money. Yet most of us make a conscious decision to pay tax on the harvest – not the seed. We do so when we elect to invest through vehicles with names like IRAs, 401ks, and others.
The smartest investors pay tax on the seed – but invest in accounts where the harvest (the money they take out down the road) is never taxed.
So if the investment returns are roughly the same no matter which “tax” path you choose – which tax path would you choose?
Clearly – the path that allows us to pay tax on the seed – and exempts us from any tax on the harvest. Even an average investor can have $100,000 – $300,000 more to spend – if they take this route.
But our mainstream Wall Street advisors don’t even tell us such an option exists. It does – and if you’ll comment back I’ll show you where you can grow your money tax-free.