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Welcome to Phoenix Master Financial. After I learned lessons and gained experience through stock market crashes and house market bubble burst, I realized the need and benefit of an investment strategy that balances growth and protection and is efficient against inflation and taxation. I believe a good portfolio shall include asset allocation in real properties, securities and insurance products for it to outperform volatile market as diversity reduces risk and to keep pace with potential inflation and higher taxes since governments currently run with huge (or unlimited) debts and print a lot money.

Financial freedom is secured by whatever you keep but not by what you got. In current low interest rate environment, finding ways to get better return and deferring taxes are more challenge and very important for wealth growth. As an example, if you invested $10,000 with 4% annual return. Assuming inflation rate is 3% and federal income tax bracket is 28%, your net becomes $9,988 which means your investment actually lose value after one year. Step by step calculation is shown in the table. If federal income tax bracket lowers to 25% and other factors are the same, same calculation steps will show the investment value keeps at $10,000 unchanged, or just made it even, after a year.
Impact of Taxes and Inflation: step by step calculation
Initial investment$10,000
Return after one year (with 4% return rate)$400
Less federal income taxes (28%) -$112  ( = 400*0.28. Tax on gains only )
Net return after-tax$288    ( = 400-112 )
Net investment after-tax$10,288
Inflation rate 3% (so, divide by 1.03 to adjust inflation) Value-with-inflation = Value-without-inflation + Value-without-inflation * Inflation-rate
Total Net after inflation and taxes$9,988  ( = 10,288/1.03 )
Return rate after inflation and taxes-0.12%  ( = (9,988-10,000)/10,000) )

Planning ahead may not guarantee a success but will definitely increase the chance of success, especially in generating retirement income. Many professionals, including a Fidelity article and a Charles Schwab webpage as shown below, recommend annuity as an important component in smart retirement income strategies.

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SITE NOTICE: PhoenixMasterFinancial.com is re-directed to this site. "dafa" is the spelling of Chinese word "大发", meaning grand prosperity.
 
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With a loss of 20%, one needs a gain of 25% to recover.
With a loss of 50%, one needs a gain of 100% to recover.

 - pure math
Phoenix Master Financial LLC
4025 W. Chandler Blvd, Suite 3
Chandler, AZ 85226