Einstein and Rothschild's combined wisdom. In this episode, I'm going to address the 8th
wonder of the world --tax-free compound interest. Get ready. I'm going to blow you away.
So, I'm Doug Andrew. I've been a financial strategist
and a retirement planning specialist now for more than 4 and a half decades.
And so, I've helped many, many people understand the power or the marvels of wealth accumulation.
There are 3 major marvels that I talk about in my various books. The first is compound interest,
the second is tax compound interest, the third is safe positive leverage. Now, it's amazing to
me how many CPAs and tax attorneys that I teach in advance continuing education that when I ask for
raise of hands, "Hey, how many of you think you've got a pretty good handle on compound interest?"
And they all roll their eyes and go, "Yeah, we thought this was advanced continuing education?"
I said, "It is. By raise of hands, how many of you think you understand compound interest?"
And they raise their hands. And then I proceed to embarrass them in a few minutes. So, I mentioned
at the beginning of this episode Einstein and Rothschilds. Now, Albert Einstein is the one that
said the eighth wonder of the world is compound interest or compounding. In other words, he would
refer to maybe biology and say that when plants and animals when those cells begin to split and
divide, that's compound interest. In other words, the 8th wonder of the world is where a human a
sperm and an egg after fertilization will begin to double, double, double, double. And within hours,
there are billions of cells. And do you know the research shows that they begin to differentiate
into which ones are going to be the brain and the lungs and the heart, the skeletal system.
It's amazing. That's why einstein said the eighth wonder of the world is compounding. Now,
it was Rothschild who said, "No, no, no. Compound interest alone is not the eighth wonder. It's tax
advantage compounding" because he was referring to money because rothschild was an extremely
wealthy individual. He built a banking dynasty in Europe and he had five sons that he assigned to
European capitals. And they would communicate back and forth with homing pigeons on when to
buy and when to sell. And to this day, because they passed down the wisdom and the knowledge,
their empire is worth billions, okay? Now, he said, "It's compounding, tax-free". So, I'm
going to illustrate this right now by showing you an exercise that I have done with many many rooms
full of CPAs and tax attorneys who raised their hand and said, "Oh, yeah. I understand compound
interest." We'll see. So, before I show you this simple little exercise, I would recommend that you
share this video. Click like. Post a comment, subscribe, click the little bell so you'll be
notified because I post an in-depth answer to a financial question almost on a daily basis on this
channel. Stay with me to the end because I want to gift you a copy of my most recent 300-page,
bestselling book, okay? Now, here's what I do, I pass out this 8 and a half by 11 sheet of paper
to all the people in the room. These are CPAs, tax attorneys. They work with numbers all the time.
Now, this is a 26-pound copy paper. I don't know if you understand what that means. I didn't know
it first. It means it will hold 26 pounds one sheet of paper will hold 26 pounds before it rips.
That's a 26-pound copy paper. When you have card stock, that could be 80 pounds. So,
it can hold 80 pounds before it rips. Maybe you learned something already on this video. So,
I pass out this sheet of paper and I say, "Now, do not look at the printed side." It's printed
on this side. "This is what I want you all to do. I want you to fold this sheet of paper in half".
And most of them can do that. And then I say fold it in half again. And then for the little children
and adults appreciate this. Fold it in half hamburger style. That means like that. See,
if you fold it in half again, that's hot dog style, okay? We simplify. So, we fold it in half
hamburger style. Now, imagine if you could fold this sheet of paper in half 48 more times. You
can't physically do it because of the folds. But imagine if you could fold this in half
48 more times. A total of 50 times. I want you to write down on your sheet of paper in
some form of measurement how thick you think this would be in millimeters, centimeters,
inches, yards, miles. And uh just write down how thick you think it'd be. So, I have them
all do that. And then I have them hold up their paper and I say, "Okay, what are your answers?"
And these CPAs, these people who work with numbers have on their sheet of paper 3-eighths of an inch,
three-quarters of an inch, 6 inches. Now, some who understand compound interest might say a mile.
When I did this, I said, "Well, it's at least 2,600 miles." I was laughed out of
the room. Everybody thought I was crazy. No. I didn't have a calculator but folks, I said,
"I thought you understood compound interest? What is this doing every time you fold it in half?
It's doubling". Double, double, double, double. I said unfold the sheet of paper.
Turn it over and look. The very first sheet of paper is five-one thousandths of an inch thick.
If you fold it over 20 times, go down to the 20th fold, it's already a mile high. At the 20th fold.
What? A mile high? No. Yep, there it is right there. Double, double, double. Okay?
It means a dollar doubling 20 times is a million 48 thousand dollars. Look down at the 42nd fold.
Whoa! 365,000 miles. It's from here to the moon. Look at the 50th fold
it's 93 million miles thick it's from here to the sun. 50 folds. Double, double,
double. If you could fold this over one more time, it'd be from here to the sun and back.
Because every fold accomplishes as much as all the folds did up to that point combined.
That's compound interest, okay? Now, let's get to what Rothschild said. Because all I've shared with
you so far is this eighth wonder that Einstein claimed was the wonder of the world. So, folks,
I have charts in my various books that show this. If a dollar doubles every period for 20 periods,
okay? It will be worth $1,048,000. And you can see it, it's right here. The math doesn't lie.
So, if a dollar doubles 20 times and it's really worth1,048,000; that's if it's been accumulating
tax-free or at least tax-deferred, okay? Now, most people in America, where do they save their money?
In banks, credit unions, normal mutual funds that are taxed as earned. It's the worst way to save
and the most common way Americans save. Why? Because if you were just in a 25%
tax bracket, and $1 doubled to $2 and you pay tax of 25 cents on that dollar gain, now you only have
a buck seventy-five left over to double. That doubles to 350, you pay tax on that. Guess how
much you'll have at the end of 20 periods instead of a million. Only $72,000. Seven point two
percent of what you could have. If you're in a 33% bracket,
you'll only have 27,000 instead of a million. Two point seven percent of what you could have had.
And that's the way most Americans save. Now, if you're sitting there going oh, "I'm smarter than
that, I have money in tax-deferred IRAs, 401ks. Oh, I have a million." That's not all your money.
At least a third of that belongs to the government because that's the deal.
When you take it out, you have to pay tax. You have to give up a third. Uncle Sam has not had
a permanent tax lien on that for years. So, it's not worth a million. It's only worth 600;
650; 700 thousand. Are you getting it? I would rather have the full million totally tax-free.
That's a lot more. Not only that, but that million, okay? If it doubles to 2 million,
to 4 million, to 8 million. And I've had many clients do that using an instrument that I call
the Laser Fund. And I'm going to gift you a copy of a book by that title here at the end for free.
But this has allowed many, many thousands of people that we've helped to be able to earn
compound interest tax-free so that at the end of the day if you set aside 100,000; 500,000 and that
500,000 doubles to a million and a million doubles to 2 million. And 2 million doubles
to four. And four doubles to eight. Yes we have people who started out with five hundred thousand
it has doubled to now 8 million. And they've done that in as little as 30 years. I talked about
doubling. So, what doubles your money every 7 to 10 years? Well, I've done that with my Laser Fund?
iIve averaged 10.07%. Let's just say 10/10 divided into the number 72 .This is called the rule of 72.
You take whatever interest that you're earning and divide that into the number 72, it will tell
you how many years it will take to double your money. So, 10 into 72 means my money doubles every
7.2 years. If I earn about 9.6%, it'll double every seven and a half years. If I earn 7.2%,,
it doubles every 10 years. Are you getting it? Well, that means these people every 7.2,
7 and a half years; 5 hundred thousand without adding a dime double to a million in seven and a
half years. A million double to two million by the 15th year. By the 22nd yearr, okay? Four million
and then eight million. We have people with 8 million dollars now earning 10. That's 800,000 a
year tax-free cash flow for as long as they live because it is the eighth wonder of the world.
It has been compounding and continues to compound totally tax-free. That's why Rothschild called
compound interest tax-free is the 8th wonder of the world. So, how can you participate in this?
Because there are 3 types of people in the world --those who watch things happen, those who wonder
what happened as their friends and associates become multi-millionaires understanding this
and there's those who make things happen. I want to help you make it happen. So, as a financial
strategist, I've been blessed to have written 12 books. This is my favorite financial book. It's
called The LASER Fund. We send out over 500 books a week. I want you to have your free copy. Because
in my educational institute, I will gift you this information. You just contribute a nominal amount
towards the shipping and handling. I'll cover the rest of that. And here's how you can claim your
free copy. You go to laserfund, LASERfund.com. And you'll have instructions there and we can fire
one out to you if you like to listen and learn or watch and learn. There's options there. But
I want you to be empowered because this is 2 books in 1. This side has all the charts and
graphs and explanations, 200 pages. This side 100 pages with 62 actual client stories of how
the Laser Fund allows you to accumulate your money totally tax-free compounding at
7, 8, 9,10 percent rates of return. You don't need pie in the sky rates of return
when you have the marvels of wealth accumulation. Compound interest that's totally tax-free.
Now, in the book, you will learn about those marvels, those miracles. And it's sort of like
when you fly an airplane. Sometimes people don't understand in order to get airborne financially,
you have to have lift. That's compound interest. You have to have thrust, okay? That's tax-free.
But you also have to have drag or friction or resistance. And that's what I call safe positive
leverage. I can't talk about that. We're out of time in this episode. But you can read about it
in here and it will empower you to become wealthy. Isn't it time you became wealthy?