We left off last article with the discovery of a new hope. A financial equivalent of Luke Skywalker! A strategy, that if used properly, could be used as a way to purchase cars, homes, college (without it being held against you by FASFA) and then again as your own personal pension plan.
However, much like when the Empire discovered the existence of Luke Skywalker, causing them to shift their focus and strike back, our government and the banking industry did the same. They began a strike that was two-fold. First, they began a public campaign to change the opinion of the people, displaying it as a tax loophole for the ultra-rich. Ran so successfully, it was brought to congress. This was the second and final part of the strike. They capped the amount an individual was allowed to place into this account, bringing to life the “Modified Endowment Contract” or “MEC.”
See this strategy minimizes your reliance on the banking industry. It has also found a way for your money to grow tax free. Basically, this strategy limits the banks and government! However, with the introduction of the MEC, if an individual goes above the allowed ratio, it’s treated like a qualified plan (your 401K or IRA) bringing the government and banks back in!
This strike against the strategy was the equivalent of the Empire’s attack on the Rebel’s base on the ice planet Hoth. Thinking they had scattered the Rebels, the Empire had thought they won; much like the government and banks. But just like the Empire they thought wrong!
To Be Continued…