What if I told you that you have the potential to increase your lifetime earnings by millions of dollars with a simple method? Would you think I was trying to sell you something? Would you be worried it was a gimmick? It is not a gimmick, and I am here to give it out for free.

The secret lies within the power of 1%. Increasing your investment returns by 1% annually over the course of our lifetime can add up to millions of dollars. Let us use a Roth IRA as an example and do the math.

Let us imagine you were to contribute the maximum amount to a Roth IRA (currently $7k/year) for 25 years with an average annual return of 7%. Then say you were to retire and continue to let it grow for another 25 years. This results with your account holding roughly $3,100,000.

Now let us take the same example but earn an average of 8% annually instead. This now results with your account holding roughly $4,500,000. About $1,400,000 more. Not to mention that if you are doing this in a Roth IRA that is almost $1,400,000 more in tax-free money.

This is an over-simplified example where we assume no withdrawals of course. Any withdrawals we would take in retirement would of course reduce future dividend earnings. The point, however, remains that something as small as 1% has the power to make life altering impacts.

So how can you do this? If you are already contributing to a 401(k) at work (or similar employer plan) than you already have the means to achieve this. Your investment selection, though it might seem trivial on day one of your new job while listening to HR’s presentation, is a decision that may change the trajectory of your own retirement.

So, in the words of Jerry Maguire: “Help me help you!” Let us analyze you or a friend/family member’s 401(k) and its investment options and see if you are on the right path. There is no trick to it and no charge.

If you are on the right path than that is great, and you will receive a handshake and pat on the back for a job well done. If not than you might get 1% closer to your retirement goals.

For information about the role Tower Trust & Investment Company can play in your estate plan, call us at 563-388-2628.