The 90% Problem: Why Most Savers Fall Short and How to Change It
- John Perrings
- Feb 27
- 5 min read
As a financial professional, I’ve had thousands of conversations about money. One thing has become crystal clear: even the best savers are losing the wealth game.
Most people I talk to save less than 10% of their income. Even the so-called “best savers” are only hitting maybe 20%.
These folks will gather around the office water cooler or at their friend’s BBQ and get into a discussion about the rate of return their financial planner got them on the 10% of the money they were able to save.
Meanwhile, the other 90% of their money leaves their lives forever, never to return.
Savers are pinning their hopes on getting high rates of return on that small fraction of their money. But that’s like trying to fill a bucket with a giant hole at the bottom.
Why Traditional Financial Planning Fails
It Focuses on the Wrong ProblemFinancial advisors will talk about maximizing returns or tailoring portfolios to your “risk tolerance.” But here’s the hard truth: no matter your risk tolerance, your money is still in financial products that could lose value.
It’s Built on Probabilities, Not CertaintiesEvery financial statement warns you that “past performance is not indicative of future results.” Yet, traditional planning relies entirely on hoping the past repeats itself.
It Ignores the Real OpportunityThe focus is always on the 10% saved, while ignoring the massive potential of the 90% of income that’s lost to taxes, debt, and expenses.
The result? A system where more than 90% of retirees end up with less than $1 million in savings, even though tens of millions likely flowed through their hands over the course of their lives.
A view of the numbers
Here is a 35-year-old starting with an income of $100,000/yr and working for 35 years. If we include a 4% average cost of living increase to their income and have every dollar earn a safe 4% rate of return, look at how much money potential passes through their hands over 35 years.
This person’s maximum financial potential is $13.8 million!
But look at what happens in real life when we account for taxes, debt service, and lifestyle...
Because these costs are happening all along the way, the money spent never gets the chance to grow, and financial potential is lost forever.
Now, look at what happens if we just slow down the growth of our lifestyle in the future. Without sacrificing our lifestyle today, we simply reduce the growth of expenses from 4% to 2%. Instead of letting expenses grow at the same rate as my income (which most people do unconsciously), we disconnect the growth of our expenses from the growth of our income.
By making this one change, we went from a little over $1M to almost $5M!
So, the problem we have in our financial lives is not a return on investment problem. The biggest challenge is just keeping more of the money that is already coming into our lives!
TCC’s “Lifestyle Allowance”: A Solution to the 90% Problem
In addition to slowing the growth of our future expenses, what if we could reclaim a portion of the money we still had to spend?
This is where the TCC Lifestyle Allowance comes in.
This strategy flips traditional financial planning on its head by addressing the real issue - keeping more of our money.
Here’s how it works:
Using TCC’s Lifestyle Allowance program, for every $1.00 we send to TCC, we receive 1 Point in our Member profile. In addition to the point received, we immediately get back 30¢ as an expense allowance. At the end of 60 months, we can redeem the 1 point for $1.00 in cash + a 5% premium totaling $1.05.
Here’s a more concrete example:
In this scenario, we are already saving/investing $1,000 per month in any type of account: a savings account, brokerage account, 529 plan, 401K, or whatever it is. And the amount doesn’t matter. With no commitment, it can be $1,000, $10, or $100,000. Whatever works best for you. In this example, we’re using $1,000 per month.
Instead of sending the money to a typical financial institution, we send $1,000/mo to TCC. Our money is protected and guaranteed by TCC, and every month, we receive 1,000 points in our TCC profile. Every month, we also get an expense allowance of $307.69, which we can spend on anything we want.
At the end of 60 months, we’ll have received $18,461.54 ($307.69 x 60) in expense allowance money and accumulated 60,000 points in our profile. The points can be redeemed for $63,000 in cash, including the 5% premium.
So, over 5 years, we were able to pay for $18,462 in expenses and got our full $60,000 back + a $3,000 premium.
Imagine a world where you can put gas in your car and keep your money. Pay for child care or youth sports, gym membership, power/gas bill, and health insurance. Pay for any expense you already have - and get that money back.
That’s precisely what we’ve built with The Community Corp – And it gets even better:
If we can cover $308 per month in expenses we were already paying for, doesn’t that free up $308 per month for us to invest? And if we recycle the $60K in five years to use again, doesn’t that free up $615? Then $923 five years after that? And so on…
Let’s go back to our chart.
What do things look like now that we have roughly 30% of our expenses covered over 35 years?
We now have almost $7M.
And by eliminating the Wall Street roller coaster from our lives, we did it with way less stress over those 35 years!
Take Control of Your Financial Future
The Lifestyle Allowance is available today for all Community Members. Whether you’re an Associate or Premium member, you can start reclaiming your financial future now. Talk to your CBP coach to learn how to stop losing money and build true, lasting wealth.
Don’t let another year go by, watching 90% of your income disappear forever. Take action today—and see how the Lifestyle Allowance can transform your financial life.
As a Capitol Building Partner and Advisory Board Member to The Community Corp with my agency Tayo Consulting, I am happy to have a call with you to discuss how the Lifestyle Allowance Program can work for you.
John Perrings
CBP Coach
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