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Tax Rules worth knowing “Rule of
72” estimates how long it takes tax-free &
deferred money to double given an anticipated growth rate. Simply divide the anticipated growth rate
into 72 to determine the number of years.
Example: tax-deferred money growing at 6% would double in
approximately 12 years. Worth consideration:
“Rule of 108”
estimates the time needed for a taxable account...such as a CD...to double,
assuming an anticipated growth rate.
Taxable money will double in approximately 22 years at a 5% growth
rate. |
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Would you rather double your money
in 14 years or 22 years? |
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Adrienne Tucker 800-543-7167 ext. 229 www.sourcebrok.com |
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*Once funds are withdrawn from a tax deferred
annuity they become taxable. The Rule
of 72 works for estimating annuity growth.
Any withdrawals, taxes and surrender charges are not considered in
these rules. |
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Deferred annuities are not a product of, nor are
they deposits of, nor are they guaranteed by any bank or credit union or
their affiliates. They are not insured
by the FDIC or any other federal agency, and may be subject to investment
risk and possible loss of value. |
|
Growth Rate |
Rule of 72 Tax
Deferred Annuity* |
Rule of 108 Taxable
CD at 33% |
|
2% |
36 years |
54 years |
|
3% |
24 years |
36 years |
|
4% |
18 years |
27 years |
|
5% |
14 years |
22 years |
|
6% |
12 years |
18 years |
|
7% |
10 years |
16 years |
|
8% |
9 years |
14 years |