One of my favorite topics is financial and retirement planning. Want more articles like this? Create an account today to get BiggerPocket's best blog articles delivered to your inbox Sign up for free Regardless of where you’ve heard it, it seems that most experts agree that the majority of us have about 40 productive years in life before we start to approach retirement. As Ed Slott, PBS presenter and author of “How to Parlay your IRA into a Family Fortune,” says, it’s hard for the average person to figure out the Retirement Puzzle. Many of us have enough trouble making money, let alone saving money, investing money, keeping and protecting money, and a few even have problems giving money away, like the Warren Buffets’ and the Bill Gates’ of the world. But as Ed points out, you need to have a plan, and you need to begin with the end in mind. He goes on to talk about the Silent Retirement Killers: Taxes Risk Saving Money Uncertainty Inactivity Although this may be hard for some of you to believe, the good news is that these are all under our control. The Largest Expense: Taxes First, let’s take a look at our number one expense: Taxes. We should all try to move our money from forever taxed accounts to never taxed accounts. Two of the best ways to do this is with IRA accounts and life insurance. Take the Roth IRA—it may make more sense to convert your IRA to a Roth right now. Pay the tax now. It may be better to pay tax on the seed instead of on the crop. If you’re like me, you believe taxes today are probably lower than they will be in the future. Plus, I would rather pay the tax on a lower balance today, than a larger one in the future. Besides, once you’re in a Roth, you can’t be forced to withdraw your money from the account—normally you’re required to withdraw starting at age 70 ½ in traditional IRA and 401(k) types of accounts. Life insurance, on the other hand, is much safer than a bank, as there’s no interest income tax, and money can pass favorably to heirs. Insurance policies are also protected from creditors and lawsuits, even bankruptcy, similar to retirement accounts. If you have a good advisor, who represents a reputable company, it can also make a lot of sense to convert taxed accounts into policies that can grow tax-free. One of the best wealth building strategies for me was saving taxes over the years, thus creating money to invest, and I saved the tax money by utilizing depreciation from all my real estate holdings to offset my earned income. Also, being a real estate professional at the same time was huge. Most folks are capped at $25,000 in losses, but mine were unlimited. There were years that I had negative income, yet had millions of dollars in assets. Another strategy that friends of mine, who were wholesalers and flippers, utilized was they used their Roth IRAs to purchase a real estate brokerage. How cool is that? I did something similar on a business level, where we employed three strategies into one plan. We utilized a retirement plan, in this case an ESOT–Employee Stock Ownership Trust, that owns our servicing company, and we use this in conjunction with key man life insurance to almost completely eliminate taxes, utilize asset protection, encourage employee retention, create a business bank, and set up succession and Legacy planning. See Diagram: There are some rules, for example: you need at least 11 full-time, non-family member employees, and you also need an ERISA attorney, as well as a business planner. But, this Tax Efficiency Strategy can be a huge win for everyone including government, employees, and donors. Dealing with Risk Now, let’s look at Risk. The two biggest risks are future taxes and stock market fluctuations. Remember before, I said these are in your control? Here’s an example of how you can completely eliminate risk and taxes: have an annuity inside your Roth IRA. Annuities are one of the safest, insured investment vehicles on earth, and they can also be guaranteed for life. When inside your Roth IRA, you will never be forced to take out payments or even pay taxes on earnings or payments. How cool (and simple) is that? Now, I’m not saying you should do this with all of your money or that it produces the highest yield, I’m just trying to show what a good company and advisor can do for you with the right strategy. Another retirement risk is Saving Money, or should I say, saving money in the wrong places. Sometimes the best moves require you to spend money, for example with the Roth IRA or insurance policy. Maybe it’s better to pay the taxes now, rather than later. We also need to be careful of free advice, as it may end up being the most expensive. I’ve always preferred advisors, who are fee-based, and some are becoming much more affordable today, especially online (Check out “Financially Fearless,” by Alexa Von Tobel, owner of LearnVest). More Retirement Killers The last two retirement killers are Uncertainty and Inactivity. Uncertainty will guarantee failure by doing nothing. I understand that a common concern becomes “Who do I believe?” At the end of the day, though, you have to trust yourself because it is your money. On the other hand, inactivity is probably the most deadly retirement killer. The average financial planner may tell you that having no plan means conceding to the government’s plan, and many people believe that if they wait long enough, something bad will happen to them. But, when it comes to retirement planning, I agree with what John L. Beckley (author, businessman, and founder of Economics Press, Inc.) wrote: “most people don’t plan to fail, they fail to plan.” After my father retired from a very good job with a sizable retirement account, the market crashed, and he had to go back to work in his mid-70s. Pop never knew much about retirement planning, and he didn’t read books like “Missed Fortune 101,” by Doug Andrew, either. So, if you really want a stress-free retirement, like I do, consider cash flowing assets with collateral, such as real estate and/or notes. For me, at my age, there’s nothing like a performing note that I bought at a discount, which already has a steady stream of high yielding payments, requiring little or no work (thanks to my servicer), and is still backed by a nice piece of real estate. Happy Investing!