Our Success Stories

Everyday the Life Focus Wealth Advantage team helps thousands of people just like you to make good decisions today that work for a better tomorrow. Here are some success stories…

Tax Planning Review - Annual Savings: $600

401(k) Contribution Results in Annual Tax Savings Contributions to a 401(k) plan are made pre-tax resulting in an immediate tax benefit. In addition, any contribution up to 6% of gross income will trigger many companies to provide a matching contribution. A typical company match is 50 percent of the 401(k) contribution, up to 6 percent of annual compensation.

Recently a member, who was single and earning $40,000 a year, was recommended to contribute 6 percent to their 401(k). In doing so, they would be annually saving a total of $3600 ($2400 contribution plus a $1,200 employer match) towards retirement and reducing their federal tax liability by $600 (assuming a federal tax rate of 25%) due to the pre-tax contribution. Depending on the applicable state tax rate, the overall tax savings could be higher:

Annual Salary	6% 401(k) Contribution	50% Employer Match	Federal Income Tax Savings
40,000	$2,400	$1200	$600

In this example, the 401(k) balance becomes $3,600. An increase of 50 percent over the contribution of $2,400, plus there was a savings of $600 in federal taxes (assuming a federal tax rate of 25%). Furthermore, depending on your applicable state tax rate, your overall tax savings may increase

Debt Management
1. Reduce monthly payment to debt service
2. Reduce overall interest payment on debt
3. Pay off debt sooner

If you have problems meeting payments to one or more creditors and are feeling overwhelmed by the situation, a credit counseling program can help. Some indications you may have too much debt can include using credit to buy things you used to pay cash for, constant concern over money, and depleted savings and checking accounts. A credit-counseling program can help you:

Here are some actual examples of how a credit-counseling program helped our clients reduce their monthly payment, reduce the total interest paid, as well as reduce the time it would have taken to pay off their debt.

Wealth Advantage Member Case #1

Program Payment Annual Savings:	$1845.12
Program annual Interest Savings:	$3318.18
Debt paid - off:	34 months sooner
Old payment:	$687.76
Program Payment:	$534.00
Monthly Savings:	$153.76
Previous Total Interest:	$25,007
Program Total Interest:	$7,852
Total Interest Savings:	$17,155
Previous Payment Term:	96 months
Program Term:	62 months
Pay off:	34 months sooner!

Wealth Advantage Member Case #2

Program Payment Annual Savings:	$6350.52
Program annual Interest Savings:	$2750.66
Debt paid - off:	28 months sooner
Old payment:	$921.21
Program Payment:	$392.00
Monthly Savings:	$529.21
Previous Total Interest:	$13,324
Program Total Interest:	$3,009
Total Interest Savings:	$10,315
Previous Payment Term:	73 months
Program Term:	45 months
Pay off:	28 months sooner!

Mortgage Check-up - Monthly Savings: $700

You want to make sure you are doing the right thing when you refinance your mortgage or acquire an equity loan to assure that you can maintain a good credit history and avoid foreclosure on your home, now and in the future. It is important to have a clear financial objective in mind so that you are able to choose the most appropriate solution to reach your financial goals. Your Money Coach can help you prepare financially, and provide information to help you to be a savvy home mortgage consumer.
A member had high mortgage payments and was struggling to pay $60,000.00 in additional unsecured debt. They were on a limited income. They had two mortgages with interest rates of 8.5% and 12% on the first and second mortgages, respectively.
In discussion with the member regarding their mortgage, it was determined they had substantial equity in their home. A lender was able to refinance both mortgages as well as provide cash out to cover the $60,000 of other unsecured debt so that the client now only has one mortgage. Due to the refinancing, the member reduced their monthly debt payments by $700.00 per month.

Credit Report Review - Annual Savings: $972

Every day, we help our members improve their credit score. Did you know, statistics show that approximately 70 percent of all reports contain at least one error? These mistakes can sometimes cause you to be turned down when applying for credit, or to be charged a much higher interest rate for a loan or credit card. A higher credit score qualifies you for a lower interest rate.
See the difference in total interest paid on a 30-year $150,000 mortgage, depending on the applicant's credit score. When considering the lowest credit score breakpoint on the chart (500-559) if your Money Coach helped you improve your credit score by just 1 point, to the next breakpoint (560-619) it would reduce your monthly mortgage payment by $81:

SCORES AFFECT RATES

How your credit score can affect the cost of a 30-year mortgage for $150,000 Home
FICO score	Annual % rate	Monthly payment	Total interest paid
720-850	5.8886%	$888	$169,810
700-719	6.011%	$900	$174,139
675-699	6.548%	$953	$193,023
620-674	7.698%	$1,069	$234,924
560-619	8.531%	$1,157	$266,400
500-559	9.289%	$1,238	$295,772

Click here

Retirement Planning - Annual Savings: $250

A potential client was interested in our retirement planning services. They were concerned about a local financial planner's fee of $250.00, or having a financial services firm complete the plan for free, with the inherent expectation that investments would have to be placed with that representative.
With Wealth Advantage, the retirement plan is included at no charge, and there are no requirements that the member needs to invest through us. When we also mentioned our professional experience, the client was very interested in our planning services.

Tax Planning - Annual Savings: $519,113

A member called for tax preparation services. He had recently received a letter from the IRS stating that he owed $525,572, which included penalties and interest for two years. In reviewing a transcript of the member's account from the IRS and additional input from the member, we determined the client had incorrectly reported stock transactions on Schedule D. The IRS agreed that the member's capital gains were actually a capital loss. Consequently, the tax liability was reduced to $6,459 a savings of $519,113.

First Time Homebuyer - Annual Savings: $1200 (for the life of the loan)

A member had been a renter for nearly twenty years. He wanted to buy a home. He called in to get information on first-time home buying strategies. The member had limited funds for a down payment, and was facing the prospect of having to pay monthly PMI (Private Mortgage Insurance) premium of approximately $100.00/month in addition to his regular mortgage payment because he wasn't able to come up with a 20% down payment.
After discussing the down payment he had available, we discussed looking into doing a piggyback loan, which would eliminate the need for the PMI without him having to increase his down payment. A piggyback loan is actually two loans, one for 80% loan to value, the 2nd for 10% loan to value, and the 10% difference is the down payment. By doing the piggyback loans, he saved approximately $100 per month in private mortgage insurance premium for the life of the loan.

Down Payment and Closing Costs - Annual Savings: $8,000

The member was 49, single, and had an annual salary of $73,000. He wanted to purchase a home for $395,000 with a 20% down payment ($79,000). He had $80,000 in savings and a 401(k) from a former employer that he would be rolling over to his new employer. His Money Coach determined he needed another $12,000 for closing costs. He was thinking of withdrawing $20,000 out of his 401k , which would cover the $12,000 he needed, plus cover approximately $8,000 he would need to pay the federal income taxes and premature withdrawal penalties.
His present rent was $1,300 and his mortgage payment would be $1,900. His Money Coach suggested that instead of paying approximately 40% of the 401(k) withdrawal amount in penalties and taxes, that he consider reducing his monthly 401k contribution, from $912 per month to $300 per month, to offset the new monthly mortgage payment. His Money Coach also mentioned that it was a better idea to reduce his 401k contribution and take a $12,000, 401(k) loan to cover the closing costs. While he pays back the 401(k) loan, he pays himself the interest and stretches out his $12,000 loan payment over five years. He can pay the loan off anytime in the event he comes into some "extra money" and he does not lose 40% of his retirement money instantly in one year to taxes and tax penalties. He can then increase his 401k contributions when he pays off the loan or gets a raise.
His other option is to borrow on his credit card, which may offer a 5% or 6% interest rate for the life of the balance, which is still cheaper than paying the 40% premature withdrawal penalty. The client appreciated the suggestions. He will take the first option saving him $8,000 ($20,000 withdrawal X 40% penalty).

Hardship Situation - Annual Savings: $800 Mortgage Payment

A single mother of three called her Money Coach. Recently her estranged husband had removed $8,000 from her bank account just a few days before the mortgage was due. Now she had no money for the mortgage or food.
Her Coach discussed possible solutions through different emergency sources, and suggested that she also change banks, to keep this problem from reoccurring. The member had never overdrawn her bank account before.
In the Coach's discussion with the member, it was mentioned that an emergency fund is generally recommended for times like these. She then remembered that she had one, in U. S. Savings Bonds, in a safe deposit box in Minnesota. She was going to call her Dad and have him send her some of her own Savings Bonds. She went from crying to laughing within an hour. Sometimes we just need to have someone to talk to, and then our best solution becomes obvious.

Join the Life Focus Wealth advantage membership and begin to build your Life Focus today!