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War On Wealth Series – Asset Growth

The Money In Your Mind – Why The Rich Keep Getting Richer Click Here!

Not only is the average American unable to save money but there is a serious negative savings rate taking place that is piling up the owed in this country at a pace that is mind-boggling. These families are spending huge amounts of money to finance on the largest purchases such as, homes, major appliances and autos.

During a lifetime the paid on these purchases can add up to hundreds of thousands of dollars. Infact 34.5 cents of every dollar is being spent on to finance our american lifestyle through banks and finance companies.

It is possible to recapture the and interest that you’re paying to banks and finance companies, thereby putting that money away for the future. This can be done by creating your own using cash value life , which would enable you to take loans from this private bank. As you repay the principle and interest, it’s going back into your policy, where it is growing tax-deferred and can be taken tax free for your financial future.


To Create Your Own Private Bank…

To create your own personal private bank, the goal is to stuff as much money as you can, as quickly as you can into a good participating (dividend paying) whole life or universal life policy. You will want to funnel the money into the whole life or universal life policy for five to seven years by over-funding the policy to just below the MEC (modified endowment contract) guidelines. Now this is where it gets good. Every time you need to make a big purchase, you can borrow the money from your personal bank, instead of borrowing from a commercial bank or credit card company, etc.

Now, you pay the loan back to yourself, plus the interest you would have paid to the commercial bank.  You are now making the big profits on your money, that the bank would have made.

The misconsception is by paying cash for your purchases you are escaping the whole debt-interest conundrum. The point that is being missed is, you are either paying interest to someone else or if you pay cash for your purchase, you are giving up the interest you could have earned on that money.

Why Use A Participating Whole Life or Universal life Policy?

The reason you use a participating whole life or universal life policy is that it offers several unique benefits, the other investment vehicles don’t offer…

It builds a liquid cash reserve of safe money.  Generally, it can be accessed within 5 to 10 business days.

With the right strategy being used, Cash Value guarantees your investment principle, and offers you minimum growth guarantees for the life of the contract.

You can put in as much money as you want… limited only by the size of the whole life or universal life policy, which you can make as large as you need. (Not so, with qualified plans)

All of the money you put into a cash value life insurance policy builds tax-deferred.  You avoid paying income taxes every year, so your money builds faster.

You can borrow the money from the policy tax free, without having to qualify for the loan and without contractual withdrawal penalties.

There are no early withdrawal penalties from the Federal Government. (Not so, with qualified plans or )

Loans against the policy come from the general assets of the insurance company, and not from the policy cash values.  In many cases, you can actually be earning more on your money than the loan is costing you.

The policy is self-completing, because you have a disability waiver of premium rider (available in a lot of policies) that will continue to put the money in for you, if you ever become disabled.  (Only life insurance offers this unique benefit)

Life insurance provides a death benefit that gives your family the money you intended to save; in the event you can’t be there.

In most states, life insurance is not attachable by creditors.

Life insurance cash values don’t count as an asset when applying for college financial aid.

WORD OF CAUTION!!

There are many insurance agents  and financial  planners trying to do this for clients. Very, Very few of them have been trained on how to do this properly. Most of their clients think that they are getting something that they are not because the Life Insurance Contract was not setup and structured properly to do what you want it to do. There are a small number of people that I know of that have been properly trained on how to do this. Please make sure that you are dealing with a qualified professional that has been thoroughly trained on the proper way to structure Over-funded Life Insurance Contracts.

The Money In Your Mind – Why The Rich Keep Getting Richer Click Here!

Other Posts In This Series are:

War On Wealth – A Primer (Introduction)
The Accidental Philanthropist; but Uncle Sam! How Many Times Can You Tax The Same @#$% dollar?
How Not To Turn $20 Into A $75,000 Disaster
Maximizing The “Bank Of You Concept”; Setting Up Your Own Private Bank
Life Insurance As An Estate Planning Tool
Private Retirement Plans Vs. Employer Sponsored Retirement Plan Options
Special Valuations For Intra-Family Transfers, Gift Taxes And Lifetime Transfers
Why You Should Start A Personal Business?
Advantages And Disadvantages Of Investing In Annuities
How Owning Real Estate Can Help Me Save Taxes
How To Reduce Your Real Estate Taxes
Annuities, How They Work And Their Tax Advantages
The Three Proactive Strategies Of Asset Protection
Trusts – A Basic Foundation

Leon C. Williams
Financial Strategist
LUCA Financial Services
leon@lucafinancial.com
blog: http://leonsblog.leonwilliams.me

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Filed under: estate planning • Financial Services • Insurance

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