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Episode 6: Uncommon Banking: The Truth and Beauty of Cash Value Life Insurance
165 Plays8 years ago
At the core of the practice at Uncommon Wealth Partners is what they call the Seven Sources of Residual Income. Without a doubt, that’s something we would all love to know more about. The first source of this residual income is one you might find uncommon – and has to do with the principles of banking.
In this episode, Phillip and Brian go in depth on a banking strategy involving insurance – and using cash value to the maximum advantage. When they first present this idea to clients, many want to fall asleep or run away – but when you understand the uncommon good sense of this tool, you will definitely want to know more.
Listeners will learn more about cash value insurance, how to think like a banker, and how to structure a policy to your maximum benefit. This episode will be truly eye-opening.
What you’ll learn- How banking can be a source of residual income
- Understanding that “banking” boils down to the movement of money
- Why you should think of cash value life insurance as “uncommon banking”
- How the environment this uncommon banking creates allows you to leverage your money
- How a guy named Nelson Nash got the ball rolling using insurance for uncommon banking
- How to put your banks, insurance companies, and investments to work for you and not the other way around
- What a young Walt Disney did with a loan against his whole life policy
- How to structure a policy and payments to maximize what you can do with that money
- How to start thinking like a banker rather than a consumer
- Limitations of a Roth IRA compared with cash value life insurance
The environment that it creates is what we're after, not necessarily the product. It's about creating a way to move and manage money. That's what we want to get into today is cash value whole life insurance. – Brian Dewhurst
You're saving money and you're paying off a debt. All the while, that money is still on deposit earning a higher interest rate. It’s a mind shift. You’ve got to start thinking like a banker instead of consumer. – Phillip Ramsey
Golden Nuggets“Banking at the core is just the movement of money through your economic engine.” Brian Dewhurst
“Banking is essential to understand. Most people don't understand it. With that said, banking is comprised of multiple strategies or sources. Insurance is one of those strategies ” – Brian Dewhurst
“A typical whole life policy won't break even until you're 13 to 17 years into it depending on the carrier, and there’s usually zero cash value in the first 3 years or so. We advise trying to buy the least amount of death benefit for the most amount we can put in. That gives you the most cash value to work with.” – Brian Dewhurst
“This is the key to the whole uncommon banking concept: If you take one thing away from this, I think it's this point. Your money is always on deposit for the rest of your life” – Brian Dewhurst
“When we put this money into a policy, our number one objective is, ‘What are we doing with that cash value in that policy? What do we have access to? And what can we shore up for our clients?’” – Phillip Ramsey
“What we try to really show people is that cash value life insurance has the same tax structure as a Roth IRA, without all the limitations.” – Phillip Ramsey
“Don’t stop paying the premium. That's what Brian and I will always talk about. I think that's what differentiates us. We want you to keep funding this thing because it's just going to keep getting bigger and bigger.” – Phillip Ramsey
“You want to look for this type of insurance product from mutual owned companies, rather than publicly traded. That puts you as a policy-holder first, rather than some random shareholder.” – Phillip Ramsey
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Transcript
Introduction to Uncommon Life and Residual Income
00:00:02
Speaker
Everyone dreams about living an uncommon life, but how we define that dream is very different for each of us. And for most, it's a lifelong pursuit. Welcome to the Uncommon Life Project podcast. We're going to introduce you to people who are living that life or enjoying the journey to get there. We're going to also give you some tools, tricks, and tips for starting or accelerating your own efforts to live an uncommon life.
00:00:27
Speaker
A life worth celebrating and savoring. Please welcome your hosts, Brian Dewhurst and Philip Ramsey. Hello and welcome, this is Philip Ramsey. And this is Brian Dewhurst with another episode of the Uncommon Life Project. Man, I get jazzed up when I hear that intro music, don't you? I do, I do like it a lot. Yeah, come on. Anyway, today we're talking about the first, I say, source of residual income and our seven sources of residual income.
00:00:55
Speaker
And that's banking. And you might be thinking to yourself, wait a second, I don't get any residual income or cash flow from my bank. And you'd be exactly right. Banks don't really do that, or do they right now, right? They don't, unless you tie your money up in a CD.
Understanding Banking: Money Movement and Misconceptions
00:01:10
Speaker
You might be able to get 1% to 2%.
00:01:12
Speaker
And you know, my favorite part about the actual interest they do send you from the banks is you get taxed or you get 1099th in the year, which is exciting when it's only 32 cents. It's only paid 0.001% on your checking account, but that has not always been the case.
00:01:26
Speaker
Not always. I remember back in 1999, I opened my first brokerage account and my money market earned 5.5%. I couldn't even imagine today what that last 18 years would have been like if you could have just earned 5.5% consistently on your money year in, year out. I think when we use the word banking, most people don't understand banking. They know how to walk into a bank and do what the bank tells them to do.
00:01:56
Speaker
But banking at the core is just the movement of money through your economic engine, or whatever you want to call it, through your life. So banking is just the movement of money. And historically, the movement of money through banking has earned you interest.
00:02:12
Speaker
And so this could also be maybe the vein of saving versus investing. If you're going to access the money prior to five years, then that's savings-type money. And if you're going to hold it for longer than five years, that's typically investment-type money. Other way to look at it is like, I don't want to lose any money. That's banking or savings money. I'm willing to take some risks. That's investment-type money.
00:02:38
Speaker
trying to keep things super simple. But we want to talk about banking because we have a different way to bank. And to be honest with you guys, this is the reason why Brian and I are sitting where we're at today. And it really started with I got into the business about five and a half years ago and I was just completely frustrated. They told me to go get a list of 200 of my family and friends to go talk to.
00:03:03
Speaker
They told me they were gonna get some great training process for me, which was basically, I'm gonna break this down, so hang on. It was call your 200 family and friends, closest family and friends. Ask them how much they're saving a month. Think about that. Ask them what would happen if one of them never showed up after work. Just kill one of them off. Make the other one cry, because that was important. And then take some of that money that they were saving every month
00:03:32
Speaker
and sell them more life insurance. There it was, everyone. Just did it. Amazing training program. I was just frustrated, right? That doesn't resonate with me at all. It doesn't for any of my family and friends. I remember calling my family and friends and they would be so gracious letting me sit down with them. The first thing I would say is, I have not figured this out yet. What they're telling me, there's no way I'm going to talk to you about it.
Forming a New Banking Concept: Personal Journeys
00:03:56
Speaker
Brian and I had coffee.
00:03:58
Speaker
And I remember just being, I think probably at first we were both like, everything's great. But both of us were like hating our life. And I was just like, man, there has got to be a better way because I just cannot sell the way they want me to sell, how they want me to sell. It just doesn't seem
00:04:15
Speaker
different or uncommon, which at that time it was not uncommon. We're here now. We're here now. Brian's like, there is a different way. I just don't know how to sell it. For the next, I'd probably say two and a half hours, Brian laid this concept out to me. It dovetailed so well because his dad was in insurance, his uncle was in banking, and his mother was in
00:04:37
Speaker
securities and investments. All of this knowledge, Brian just got to completely be around his whole life. I never was around it. He started thinking about ways and different ways to help people with his money. That was what he talked about that day at that faithful coffee shop. That's the reason why we're here today. That's the reason why it's number one.
00:05:00
Speaker
Yeah, so true. I remember that coffee so well. And once we got past the quintessential, everything's okay. God got to work. And I think, yeah, I was in a, you know, you don't appreciate, I think, everything in your childhood until you get older and you start looking back. But yeah, I just remember at dinner, oh, we would just talk about work and my parents talk about work. And I was the only child, so there was really no, wasn't a lot of other people to talk other than me and my parents.
00:05:28
Speaker
You know we talked about a lot was money and investments and so and then when i got into consulting with the solution i spent five years auditing some of the most storied companies in america and seeing the power of business and cash flow and. And those types of things and just multiple streams of income i was able to start to put together that background in banking background insurance and background investments. Into a strategy that we feel is more.
00:05:57
Speaker
rewarding, more predictable, and less risky over time and truly more, I would say, diversified than just putting all your money in the stock market and praying to God it doesn't go down.
Introduction to the Uncommon Banking System
00:06:10
Speaker
But I think we saw that in 809. Everything went down in concert with each other with the exception of our uncommon banking.
00:06:17
Speaker
system and that's what we want to get into today. Banking is essential to understand. Most people don't understand it. With that said, banking is comprised of multiple strategies or sources. We all need a checking account. We all have a debit card. Most people have a credit card now. If you play the point game, if you don't, that's up to you. We think banking has four key components and we're going to get into this first.
00:06:48
Speaker
On our list is the Uncommon Banking System, which we'll dovetail into, which is going to be the highlight of this episode. And then two is gold and silver. Gold and silver have acted as currency for over 5,000 years, over 400 mentions in the Bible. Every known civilization document in the history of the world has had an adornment use fascination with gold and silver on the recording.
00:07:11
Speaker
planet and now we have cryptocurrency which we're seeing a lot of interest and intrigue in and then obviously fourth and the reason it's last is because it's the one that's obviously the most simple and the least profitable is just leaving cash at the bank you know checking account and your basic transactional type solution for banking but we think banking is comprised of all four components but you should probably leave the least amount in the bank
00:07:38
Speaker
and potentially fund these other multiple strategies. We'll get into that more. Today, we're going to focus on our uncommon banking strategy. What is that exactly? I wish we had an automated drum roll.
00:07:57
Speaker
It's cash value life insurance, and I love the look people give us when we first say it.
Cash Value Life Insurance: Benefits and Misconceptions
00:08:06
Speaker
It's just like, oh my God, you're getting me out of here. But the environment that it creates is what we're after, not necessarily the product.
00:08:16
Speaker
I think you always say to people, and I think it's so true, if we could get our money in this environment and it was to buy cattle, then we'd buy cattle. It's about the environment the policy creates for our money that we're trying to achieve. Then using that as an instrument, as a banking tool, is the secondary mechanism.
00:08:40
Speaker
And so that's kind of what we want to get into today is cash value, whole life insurance. And I think as you look at life insurance in general, you have term life, variable universal life, universal life, index universal life, and whole life for the most part. We really typically only sell term and whole life because
00:09:02
Speaker
You know, terms obviously need in some instances to cover assets and different things. But predominantly, we do believe in cash value life insurance as a source of residual income, as a way to build and protect wealth, and as a way to bank. Compliance caveat, an insurance company is not a bank. This is a banking strategy. Banking is just the movement of money. So this isn't a bank. We don't want it to be a bank because they have two different jurisdictions, tax structures, all those different things.
00:09:32
Speaker
Yeah, so I mean, my uncle, he's not an uncle, but Dave Ramsey would absolutely have a cow at this point, right? What are you talking about? And so I think it's important to say kind of the way and the history of how this kind of evolved. And the person that started this concept kind of fell upon it was a man named R. Nelson Nash. And Brian and I have had the
00:09:56
Speaker
I'd say privilege of meeting him in person and hearing how he talks about money, federal reserve. He has all these different things that he just starts going on and on about. He's 87 when we saw him. In his 80s, I think. Yeah. Somewhere in the town. But anyway, so the guy just gets fired up and he talked for six hours. I mean, I don't know if he took a break. I mean, at some point, people were like, can we just take a break? We've got to get him back.
00:10:25
Speaker
But the guys on fire and the way that he struck, he found this strategy was kind of a fluke. Yeah. And it's interesting as we interview business owners, I don't want to call it dumb luck because I think that's minimizing it a little bit, but just that like you're at that point of there's a fork in the road and you need the right fork.
Inspiration and Real-World Examples: R. Nelson Nash and Walt Disney
00:10:48
Speaker
And, you know, god met him there so yeah he had basically the same story as Dave Ramsey, he was on his knees, you know, praying to god for a way out of being over leveraged in the 70s and 80s, you know, on real estate with variable rate interest.
00:11:04
Speaker
interest loans and interest rates went to 21%. He was looking down at all of his financial statements on the floor and he saw loan value on his whole life insurance policy. He called his agent the next day and said, hey, can I take a loan on these policies? There's a loan available and the guy said, yeah.
00:11:28
Speaker
He goes, what's the interest rate? And the guy goes, 5%. And he's like, oh my God. It was one of those moments, you know, and he realized he could take a loan against his life insurance and pay down or pay off.
00:11:43
Speaker
restructure the interest or the loans on his real estate and he was able to keep the properties and basically not go into bankruptcy, which oddly enough was the path that Dave Ramsey went down. He did go into bankruptcy because he didn't have that backup asset class. I would say Dave Ramsey is a better marketer.
00:12:04
Speaker
than R. Nelson Nash has been in the strategy, but we're here now talking about it. And so really, Nelson Nash released that book in 2000 or 2001.
00:12:15
Speaker
This strategy or concept as a philosophy in order to organize your money in cash flow is very infant compared to the big insurance world which you came up in or the investment world that I grew up in with my mom's firm of just putting all your money in stocks and bonds. It's a concert of the three of banks, insurance companies, and investments. How do those three work together so our clients actually succeed?
00:12:43
Speaker
For sure. And so, R. Nelson Nash started this whole concept, but there is another, I guess, famous person that I want you to talk about that used this strategy for a crazy reward. And who was that? Yeah, that's Walt Disney. And probably one of my, I don't know, I call it like a divide moment, I was able to go fortunate enough to go on a trip to Disney land, or Disney World in Florida.
00:13:10
Speaker
For you know expense paid trip and there's a little movie theater there that has like a 10-minute video on Walt Disney and I'm sitting there by myself You know kind of at a point my career of like, you know, do I keep going down this path? We're kind of paving a new trail People are telling us we're crazy
00:13:28
Speaker
And in the video he talks about they talk about Walt Disney how using California with his two daughters and he was taking on daddy daughter dates and he was just bored he didn't know what to do with them and that was actually the genesis for the idea of the theme park Disneyland in California so he went to the banks hey I want to borrow this money and
00:13:47
Speaker
do this theme park with my cartoons and stuff and they're like, no, you're crazy. And so the actual seed money for Disneyland was a loan against the cash value, a
Over-Funding and Leveraging Life Insurance
00:13:58
Speaker
whole life insurance policy. And they say that in the video, the documentary on Walt Disney at Disney World in Florida.
00:14:04
Speaker
It was just one of those moments where it's like, God couldn't be any clearer. The question that we always ask our clients is, what was the return on his life insurance policy? We get so hung up on the interest rate or the dividend and all these different things, but it doesn't matter what the return on his life insurance policy was. What mattered was that he brought a dream to life and he shared it with the rest of the world.
00:14:27
Speaker
And I wouldn't say it doesn't matter, but in that comparison, it doesn't matter for, well, he didn't care at all, but we definitely do talk about that. And so we mentioned the book of Arnelson Nash and that book is Becoming Your Own Banker. And our clients don't even know
00:14:42
Speaker
who Arnold Solnash is, honestly, because it's something that when you read that book, at least for me and probably you as well, you can read it and you understand it a little bit, but to actually put it in your own... To implement it. To implement it. It's a whole different deal. A whole different deal. But I would say that the way that he talks about it in there is there's a couple main points. You want to be using a mutually owned life insurance company.
00:15:09
Speaker
And you don't want to be using these universal life, variable universal life. And the reason is because they're one for the people who own the policies instead of stockholders. And an example of this that I've kind of in my training, I got trained with Principal Financial Group. That's just who they were. And they demutualized in 2013.
00:15:34
Speaker
And when I started getting trained there, it was I think 10 years later, 2011.
00:15:41
Speaker
They started telling me, oh, well, you got to use variable universal life. You got to use universal life. And then they always tell me to quote interest rates that I felt were a little off, right? Like 12%, like, really? And oh, yeah, that's right. And I started doing more and more research because I would get calls about people who had a mutually owned whole life insurance policy. And so I asked them about that. And they're like, oh, no, we don't sell that anymore. We're a stock owned shareholder company.
00:16:11
Speaker
were really for the shareholders. But I'm supposed to be selling this to my 200 closest family and friends. It just didn't seem like it resonated. And so that's when Brian and I started talking and I started understanding more about why it's important to have a mutually funded company that will pay you dividends because you own part of the company, right? Because you just bought the product from them. And so that's the reason why the R&L's and that just says, use a mutually owned company.
00:16:39
Speaker
And so I would say there's a lot of people also that have been trained under R. Nelson Nash that put way too much emphasis on policy. They try to put too much money into it. It's oversold. It's oversold. And guys, we are not telling you this is a get rich quick scheme. This is a system over time.
00:16:57
Speaker
that can be powerful for each one of our clients if they think it's for them. But how that works is it's important for us to show them their actual numbers in the system so they can conceptualize it in their head. So what exactly is this concept of uncommon banking?
00:17:18
Speaker
Yeah, it's just where we teach people how to, we call it over-funding. Essentially, the insurance industry over-designed whole life insurance policy and they created what's called a paid-up additions rider. It's kind of like, just think of it like a
00:17:38
Speaker
like an extra savings account, you can bolt onto your policy, and it just allows you to dump in excess cash. And we've always been trained by the insurance companies how to sell insurance, which is to sell the most amount of death benefit for the least amount of premium. What we do is actually the exact opposite, because that's what helps them win, right? The insurance company. And the agent makes the most money that way.
00:18:03
Speaker
And the client gets the, you know, they think they have the best deal because they're paying the least amount of price for the most coverage. But really what they've done is they've committed the fateful error by putting the least amount in. You don't capitalize your business. And so like a typical whole life policy won't break even until like year 13 to 17 to pair it depending on the carrier. And typically in the first three years, you don't have any cash value.
00:18:27
Speaker
we kind of do it the exact opposite where we're trying to buy the least amount of death benefit for the most amount we can put in relative to someone's personal plan. So this isn't like crazy or free money or anything. But when we do that, we actually drive down the cost of insurance and we hit a break even point from a banking standpoint, meaning like we've put X amount of dollars in a premium and the cash value is worth X amount of dollars. And that's accessible via policy level.
Life Insurance vs. Traditional Investments
00:18:57
Speaker
And that's the power to the whole thing. And what the rich have figured out is how to get multiple uses on their money. One of the major ways rich people get richer is real estate. We see that with Donald Trump in the White House. Real estate is powerful because you can put in a down payment and you can leverage the bank and you can get other people to pay you rent. And that rent is inflation protected. You get a tax protection for owning real estate through the IRS tax code.
00:19:26
Speaker
and it's a great way to build wealth. Well, a life insurance policy is structured kind of the same way, except rent is a dividend. They're not contractually bound to pay it, but most of the carriers left are paying a 4% contractual guarantee in cash, and they pay a dividend above that. The companies we're using are north of 6% right now.
00:19:49
Speaker
and you still have access to the money in there and we show people and teach people how to borrow it out and leverage it to pay off debt or buy assets to produce cash flow. And all the while, the insurance company still owes you the interest and dividend on your money like it was still there, for sure. So talk about the environment that you create when you open up a policy. So the four main attributes of money that we talk about are liquidity, which is the most important, especially if you own a business.
00:20:18
Speaker
Two is safety. You want the money to be there. You want it to be non-volatile. You want it to be safe and secure, insured, guaranteed, all those different things. Then from there, third is taxation. Pretty much everything is taxed now minus, oh, wait a minute, whole life insurance and a Roth IRA and municipal bonds, which nobody wants to buy because interest rates are so low.
00:20:42
Speaker
And then from there, you have rate of return, which we're told the stock market is 12%. It sounds great when it's up. It never seems that way when it's down. But yeah, these mutually owned whole life insurance companies, they've been paying historically 4% to 6% for over 100, 150 years.
00:21:04
Speaker
It's a great place to store liquid cash because the money is liquid to you. It's actually contractually guaranteed by the insurance company. It grows tax deferred and you can access that growth through policy loans without paying tax.
00:21:20
Speaker
Oh, by the way, if you could get 4-6% on liquid cash, the banks can't touch that right now. When you look at the 40s, the 50s, 60s, 70s, 80s, 90s, we were getting an historical interest rate of the bank was 5-6%. We saw that go up to
00:21:40
Speaker
the teens in the early 80s and then come back down to 5-6% in the 90s and now we're near zero again and have been for almost a decade. So yeah, it's extremely powerful environment to store money. So let's just talk about this because I don't want to lose any listener. So let's say you have $10,000, right? A lot of money.
00:22:00
Speaker
You put it into a policy and what we're saying is it's still on deposit even if you access via a loan that money. So let's talk through that scenario. So our listeners can kind of conceptually walk through this so they understand. Yeah, I think this is the hardest part for people to understand because it's so foreign.
00:22:26
Speaker
We try to break it down like this. Let's say you have 10 grand in a checking account and you need a car. And you take out a loan for the whole 10 grand of the car. You owe the bank interest on your car payment. But they still owe you interest on your checking account. The money is still on deposit.
00:22:42
Speaker
It's kind of the same thing. We're putting your money on deposit inside an insurance policy, and that insurance company owes you interest on your deposit. They then pool all their money in a general fund, just actually like the banks do. Banks pool all their money, and then they lend it out. The insurance companies do the same thing. The insurance company says, oh, by the way, you have first right of refusal to take a loan on your money.
00:23:10
Speaker
If you don't take it, we're going to take it and then we're going to loan it out to other people, other institutions. And these big insurance companies facilitate massive deals and they fund corporate projects. And yeah, they move their money around just like banks do.
00:23:28
Speaker
albeit in a less non-leveraged way and far be it safer way than banks, but that's a separate discussion. Yeah, and so your money is technically still on deposit. You just have access to loan against it.
00:23:43
Speaker
You're loaning against it, not from it, but you can only loan what you put in or what shows up in cash value. This is the key to the whole deal. If you take one thing away from this, I think it's this point, your money is always on deposit for the rest of your life. The more money you put in,
00:24:04
Speaker
More money that's always on deposit and the more money that's contractually earning interest for the rest of your life and that's the environment that's Contractually bound within a whole life insurance policy. It's a contractual obligation for sure so I mean I think that's that's a huge point and
00:24:24
Speaker
that people have trouble wrapping their heads around. But when we put this money into a policy, our number one objective is what are we doing with that cash value in that policy? What do we have access to? And what can we shore up for our clients? Depending on what they have, if they want to go buy a rental property, if they want to pay off debt.
00:24:45
Speaker
We will structure that policy in a way for them. We have clients that are putting a lot more than $10,000 in a policy. Then we also have clients that are putting a lot less than $10,000 in a policy. It depends on how big you need your bank for. The people who have a lot more money usually need their bank to do a lot more things than a person that doesn't have that much money.
00:25:08
Speaker
It doesn't need that much to do on the side, but it's still the benefit is there. What that would look like is if you put a $10,000 in, let's say you had a loan for a car of $7,000 and you were paying $200 or let's say $300 a month. You put money in the life insurance policy, you take out that $7,000 and you would pay off that car.
00:25:32
Speaker
Now, because you're an honest person, you would still want to be paying back that $300, but now you just send it back to your life insurance policy that you own, right? And when you do that, two things happen. One, the amount that you owe goes down, $300, right? But the amount that you can take out goes up $300. So you're kind of doing two things there. You're saving money and you're paying off a debt all while
00:26:00
Speaker
all that money is still on deposit, earning that higher interest rate for the policies that we use. It's a whole different mind shift. Now you've got to think like a banker instead of a consumer, which is hard for people to understand, and eventually they'll get it and understand it.
00:26:19
Speaker
And then the next year you have a premium payment due because it's kind of a play to pay kind of thing, but we want more premium to pay because we want our bank to get bigger and we have bigger things that we need to do. And so that's the way that we can structure, we can help our clients understand the power of putting something that's always on deposit for the rest of your life. And then it goes to the point of like, oh, I wish I was just younger to do this because it puts time and interest on your side as a client.
00:26:48
Speaker
And so how does this fit in the overall plan? It's different for everybody. But we have seen that this has been a powerful concept that is something that is really easy to access.
Life Insurance in Broader Financial Planning
00:27:01
Speaker
You can get your money right away. You don't ever have to go through background checks or all the different rigor and roll that the banks let you do. You just, hey, I want my money. And they send you the check. Just send me the check. And then you go pay off that debt.
00:27:16
Speaker
Let's talk a little bit about let's say you did that example you just paid off your car seven dollars dollars and you graduate that's what you die. What happens to the death because there is a death benefit that brian and i really don't talk about a lot but there is a death benefit attached to this. And it would go down dollar for dollar so you bought that car seven thousand dollars you have a lot of your policy for seven thousand dollars.
00:27:40
Speaker
Your deathbed if it would be whatever the deathbed if it was minus $7,000 so you would never have to repay that loan is already done So that's kind of what happens like I guess worst case my worst case scenario But now let's talk about something else. Let's say you took out a $7,000 loan and you paid off that car and You don't have that $300 the next two months. What happens? You just don't make payment
00:28:07
Speaker
Yeah. And what would happen if you did that with a conventional bank? You got people knocking at your door. It's awkward. And so, yeah, this, you have to be honest, but we feel like it's a little safer environment because you pay cash for it. The only person that you're hurting is yourself to not pay it back. You just didn't save that money that month, which in the grand scheme of things, yeah, pushes your timeline that you're going to repayment back maybe to
00:28:32
Speaker
Now there is an interest attached to taking that alone and right now for the companies that we're using it's 5%. And so I think the argument, and we'll go into objections that people have had in the past with this concept, it's why would I ever take
00:28:47
Speaker
a five percent loan somewhere, if I can just go to the bank and just pay two or three percent, right? And we'll talk about that in the objections. But I mean, that definitely is a question that we get a lot. And so I guess what other things that we can help people understand this uncommon banking approach that we haven't talked about. And then let's go into the objections that we've heard. Yeah. And then let's talk through those.
00:29:11
Speaker
I think the big one for me, and this is kind of one I like to use, is the tortoise and the hare. We all know that the tortoise wins, and I think the hare is obviously the stock market, and a lot of people are getting exposure to the stock market through their company retirement plans. Money's going in there every two weeks. That's the best way to invest. You got money just perpetually going in. You got your employer putting money in.
00:29:35
Speaker
Um, the data suggests that the employer match barely covers your taxes, um, pulling money out in retirement. So, um, don't know. I think that's one of the biggest, um, I know it sounds like free money and it somewhat is, but, um, it's not all that it's cracked up to be. Um, we obviously administer retirement plans. I'm not saying don't do that, but I'm just saying do it as part of a.
00:29:58
Speaker
plan but I think for me the biggest thing is so many people want to do a Roth IRA and they love the tax treatment of a Roth IRA but then they realize how little money they can put in there and then how little they can buy with it.
00:30:14
Speaker
And it's like, well, that's going to take forever to do. So what we try to really show people is this is a Roth IRA. Cash money life insurance has the same tax structure as a Roth IRA without all the limitations. And the limitations being the funding limit.
00:30:32
Speaker
of like six or $6,500 a year you can put in. And then two, you can't touch that until you're 59 and a half unless it's for a qualified distribution. You have to leave it in there for five years to get your principal back out. And I mean, there's just all these goofy restrictions and limit of investments. Oh, totally. And with life insurance, there's no limitation on how much you can put in. Obviously, there's a limitation with how much you can put in just from a cash perspective and overall, like,
00:31:02
Speaker
Just due diligence like, this isn't free money, it takes time for you to get net ahead in this deal. And we show our clients that. So, a Roth IRA has those limitations from funding and then getting it back out. Well, life insurance doesn't have any of those limitations and we can take a loan
00:31:24
Speaker
you know, for typically up to 90% of cash value, you know, they leave 10% in there to protect the policy and then you're getting a dividend at the end of the year. So we use the policy like a Roth IRA and as the tortoise. And then we let the hair be the stock market money with your retirement plan and you can run the two in tandem.
00:31:44
Speaker
And the problem with a Roth IRA and doing that in tandem with a company 401k is you're making it all later money. Because the 59 and a half rule of getting that money out applies to both instruments. We don't have that limitation on life insurance. And you don't want that limitation on that type of money. You want that limitation on that 401k money because you're deferring tax.
00:32:09
Speaker
But you don't want that limitation of use on your money when you're paying tax, like in a Roth IRA. And then if you go through a period like 2000 to 2009, where you experience like 250% reductions in your principal balance, that's a horrible investment for a Roth IRA. Because not only did you pay tax, but now you just lost half your money.
00:32:31
Speaker
And so when you're paying tax on your money now, you A, want the use of it and B, you want to know that it's going to be worth something. Well, that's what cash value life insurance is. So it's really the best of both worlds in banking and Iraq without all the government red tape. And not to mention you can access the growth of your money tax deferred by taking policy loans.
00:32:53
Speaker
And we've said this a couple of times, but this is definitely something that you have to do with overarching plan. How does this all fit in? Does this fit in for your situation? But what we like to do is we like to overfund a policy for four years.
Critiques and Comparisons: Dave Ramsey and Beyond
00:33:05
Speaker
And for that example that we keep talking about, we put $10,000 in for...
00:33:08
Speaker
four years and people, if you have no idea, there's no way we can do this. I'm telling you, it's closer than you think because we're not leaving that money in. We're taking it out and doing stuff. Then after the fourth year, it'll drop down. That premium will drop down to maybe $3,000 every year going forward. They're used to saving 10. They're used to saving 10 and not only that is when you put in the three, the whole contract might be growing
00:33:36
Speaker
more than three. That's ideally what Brian and I want to do depending on underwriting for our clients. That's what we try to achieve. But by the end of the fourth year, you've done the heavy lifting and now you're going to reap the benefits. Now you keep paying the premium. That's what Brian and I will always talk about. I think that's what differentiates ourselves than other people is we want to keep funding this thing because it's just going to keep getting bigger and bigger. The way we do that though is creative and helping you with your cash flow
00:34:02
Speaker
But all your cash flows should be going back to a banking system. We advocate that it should be the uncommon banking system, not the regular banking system. Because right now, that's what everyone understands and knows is they go back, all your money passes through your ordinary banking system. Yeah. I want to talk about one more thing. We'll get into objections because I think this is important. So the other case for cash flow life insurance is the investment case or the hair case almost, you know, tortoise and hair.
00:34:30
Speaker
is these companies that we're doing business with and aligning our clients with, they've paid such strong dividends for decades, paying dividends of north of 6%, 7%, 8% consistently for 30 years. When you look at the adage of taking your age from 100 and that's the amount you should have in stocks or bonds,
00:34:56
Speaker
That is kind of what we feel is broken a little bit because if you're, let's just say you're 50 and you have 50% of your money in bonds and rates are going up and bond prices are going down or you've seen little to no return on 50% of your portfolio the last few years, we're coming out of a bond bull market as we saw interest rates go from 21% in 1981 down to basically zero. That increases the price of bonds.
00:35:26
Speaker
Now, we're on the flip side of that of going to zero from zero back to probably 21% over time. That's a horrible thing for bond prices. To get yield and to get rate of return and to have money that's safe, well, this is actually a very investment-worthy vehicle.
00:35:48
Speaker
And oh, by the way, you could leverage against your cash value and the insurance company is still going to pay you interest and you buy a rental property and now you're getting rent on that same cash. Well, now you have two sources of income off the same capital. And so it's just really powerful what we can do with this instrument from an investment standpoint, similar to Walt Disney example, that it's just so prolific for sure.
00:36:14
Speaker
So let's go into objections that we have heard over the last five years, because there has been some. Honestly, we want to answer all of them. We've never had one that we can't answer.
00:36:26
Speaker
I got to give a shout out to Dave Ramsey because he has given us some of our best clients. He really has. Because they have great persistence, great discipline. I'm glad you brought this up. And they've gotten over this whole universal hang up of this isn't for you. And now they love this strategy because their money is tangible to them again. For sure. And I'm glad you brought this up.
00:36:47
Speaker
They are so good at budgeting. The people that can budget love the system. And the reason why I think they flail out a little bit, or I don't know if that's the right word, but they kind of... They lose their mojo with Dave. There you go. So the reason why they lose their mojo with Dave is because they get to the point where they're debt free and now they're supposed to send all their money into their 401k or mutual funds. They're supposed to give 12%.
00:37:17
Speaker
it doesn't seem like it's helping them build wealth as fast as they once were or gain traction. And so the reason why we have such great Ramsey, my uncle's clients is because we get that excitement back to them where we can start gaining and building wealth with their policy and now they have a debt that they know how to go eliminate.
00:37:38
Speaker
And that they start putting all their cash flow like they used to do with Dave Ramsey back to their policy loan. But on the outside of that, we're building a residual income or we're building an asset that's producing cash flow that's helping them pay back that loan. And so the excitement level that our Dave Ramsey clients get is like, it's back and it'll never go away because we're constantly going after what they're passionate about.
00:38:04
Speaker
Obviously, we geek out about this stuff. Let's go to objections. We'll just fire them. How quickly can you take a loan from your policy? Day one. We've actually had people sign for their policy and sign for that policy loan. Again, they pay off a car, they pay off a student loan, they pay off a credit card, they go buy a rental property. It makes sense why people come to see us then when they have money in the bank because now they can, oh, now I have money to
00:38:29
Speaker
sit down with an advisor, but really in the back of their head, they're thinking, but I kind of want to pay off that debt. And when we talk about it, we're like, hey, let's do both. Like, yeah, how will we do that? And so it's always part of a plan when we're taking loans or typically to buy an asset, produce cash flow or wipe out a debt. And then we want to then pay that back as fast as possible. We don't want to leave it out, right? So this is my next favorite one. Why isn't everyone doing this? Yeah, it's not something you just stand around the water and be like, hey, so I overfunded some life insurance.
00:39:00
Speaker
But yeah, so this is a system over time that produces residual cash flow. It's not something that everyone does. And honestly, I think people, advisors that help people do this concept are overselling this thing. And it's not with a comprehensive plan that actually helps them take money in, put money back. And then I would also say that there's advisors that have used this thing, like you wouldn't believe, and they're only getting the premium check
00:39:29
Speaker
one year and they're hoping that their clients understand it. I'm telling you this. You've understood the banking process, but at first it was clunky. And so you need advisors to be walking through, you know, even sometimes weekly to understand this concept and to have advisors that will walk side by side with you to understand this concept. Eventually people get it and they love it. But at first it's a little, you know, okay, what about this? What about that? Like you need advisors that are going to stand
00:39:57
Speaker
I want to address the next one. Dave Ramsey says, you shouldn't buy a whole lot. So the two main arguments that I've heard and I haven't listened to all Dave's stuff is basically there's no cash value upfront and the death benefit doesn't grow. So you're basically just getting your money back.
00:40:14
Speaker
I would agree with him in that I wouldn't buy those policies either if it was structured that way. Inherently, the way we design policies, you have 80% plus of your money that you put in in cash value upfront day one, and two, the death benefit actually compounds over time as well. So your family's gonna get or your charity's gonna get more money than you ever put in.
00:40:41
Speaker
And so not only is the cash value compounding, but the death benefit is compounding too. So you can have your cake and eat it too. Those are the main two arguments from Dave Ramsey that I've found. Let's just go back after Dave Ramsey. You love him. You love him. By term, invest the difference. Why don't I do that? Yeah.
00:41:00
Speaker
The argument is the stock market is the better rate of return, right? I think that can be true. Obviously, if you invest in the right things, the actual statistical data from Ibbotson, Ibbotson is a group that does statistical analysis on investing in the stock market, says the average investor only makes 2.8% per year. And so you've got to save the difference. And we just don't see a lot of people that actually save that difference.
00:41:29
Speaker
at the rate that they probably could because, again, their money isn't tangible to them because they don't control it. It's in something that's over there.
00:41:38
Speaker
And so, yeah, you can buy term, but as you age, term becomes more and more expensive, and either due to health or your own financial resources, you won't be able to buy it any
Understanding Insurance Companies and Policy Flexibility
00:41:49
Speaker
longer. And it's weird to like, you know, we've met with, I'd say, conservatively over 500 different people, probably closer to a thousand over the last five years. And I've never met anybody, I think we've maybe met one or two. One or two. No, I got them on our hands. People that like didn't want to leave money behind.
00:42:07
Speaker
And I think as you age, you know, the Bible talks about leaving money to your grandchildren, that type of thing. I think it's just inherent within us that we want to leave a legacy and leave something behind, but we don't want to pay for it, maybe necessarily. And the way life insurance has been sold to us in the past, it feels that way. This way, our clients feel like they're able to pass something on and they're not paying for it because they get to use their money too. For sure. So why doesn't every insurance company sell this? Or how do the insurance
00:42:38
Speaker
Sure. So like we said, there is a distinct difference. We only use mutual owned companies. And really what that means is just private versus public. So if a company is publicly traded, they're typically not going to have a whole life insurance product. There are a few exceptions like MetLife as one.
00:42:54
Speaker
And there might be one other, but for the most part, you want mutually owned because they don't have that gumption to go get profits for shareholders. You as the policy holder, it's kind of your way to buy stock in a private company. And these companies that we're using have operated for over 150 years and never not paid a dividend. The dividend's not guaranteed, but again, these companies have never not paid it, even through the Great Depression, even through the 0809 collapse.
00:43:23
Speaker
So you want to use mutual companies and the reason that you know, how do they make money is well 99% of people aren't doing 99% of people are buying term or buying that universal life product that is truthfully probably garbage and we've seen tons of and it's just every time it's just
00:43:41
Speaker
They don't work unless you're funding it and over funding it and you're managing the investments within it. That's a whole different scale though than what most people are doing. Most people are paying a premium in good faith. They've been sold that this is an investment and they're gonna have the death benefit and I think nine times out of 10, that's probably not the case. Not to say those companies aren't gonna pay the death benefit or anything like that, but if you wanna access the cash and you don't have a guaranteed product,
00:44:09
Speaker
it's probably not gonna happen. Because those universal life, variable universal life, universal lives aren't guaranteed here. If they're tied to something else, a variable universal life is usually tied to the market, and the universal life is usually tied to interest rates.
00:44:23
Speaker
So if those things change, it changes a lot of things in these contracts. And that's why we say use a guaranteed product that you don't know is gonna be there. And if you have a universal life policy, I would challenge you to go and see when that guarantee runs out. Because it is scary. Get an enforced illustration if you have any universal life type product. And you'll see that the guarantee probably runs out in your 60s or 70s.
00:44:50
Speaker
So, let's keep going. I would say just one thing, just about how does insurance company make money? And that is that. These insurance companies are amazing at telling us all when we're gonna die. Yeah. And that's what they're paying you for. That's what they're giving you. Like, you're buying a life insurance product and they're saying, okay, if you're gonna buy this, then we need this amount of money from you guys, from the client, policyholder. And if you do this, we'll guarantee the death penalty.
00:45:20
Speaker
They've also over-engineered these things where they'll also give you some of it back in cash value. You can access that via home loan. We are just using their product that they have written and we're just accessing the prepayment of the death benefit earlier. So then we're going to do one or two things for it. We're going to either pay off debt or we're going to buy an asset that produces cash flow. And that's exactly what your significant other
00:45:45
Speaker
or the person that's going to get a debt benefit probably would have done. I think the last part of the component of how they make money is they're also sitting on tens of billions of dollars and they leverage their money out and they loan it to other companies. They invest in stocks and bonds and investments. They invest in private businesses and they're doing lots of different things to diversify and generate
00:46:10
Speaker
income. They make money hand over fist, truthfully, and the companies we're partnering with, they're making more money than they ever have. The other thing I'd say, too, that would really help the insurance industry and the banking industry in general is if we could see an interest rate rise from the Fed and help boost the 10-year treasury specifically. I don't help all treasuries, obviously, but the two to 10-year treasuries are the most important for insurance companies.
00:46:40
Speaker
you know, just sitting on cash. It actually is costing them so much money because they have to sit on money market type instruments, which are Treasuries, and then when they're paying such a little yield, it's actually hurting them, not helping them. And so that would also be helpful.
00:46:54
Speaker
Okay, so it sounds too good to be true. It probably is. That's what we've heard a lot. And I would say, if it sounds too good to be true, this is again, not a get rich quick scheme, but over time, this can produce a powerful asset for you and your family. And it's actually something you can benefit from right away because we all probably need a debt benefit. We just don't want to keep giving our money away in a term insurance because at the end of the day, there's only two
00:47:21
Speaker
percent of term insurances that actually get called on, meaning they actually die. And so at the end of your term, whatever that is, you've paid X and you're still alive. And so it just goes away. Their risk as the insurance company goes away, but they still have all your money. So you kind of won, I guess, but you've lost in the cash flow sense. So we kind of align all those. So that's, it sounds to be true. Yeah. It's a system over time, just like banking. And hopefully it'll reduce cash flow for you.
00:47:50
Speaker
What happens if we don't repair a loan? Yeah. So like Brian said earlier in the show, nothing, right? Like you don't have to pay it back, but you're just being dishonest to yourself. Now eventually you've got to be able to have some money to put back into it. But as long as you, if you pay the interest that is owed to the insurance company and you pay the premium, they can't surrender that policy.
Stability and Flexibility of Life Insurance Policies
00:48:13
Speaker
You can keep not paying. Yeah. And worst case,
00:48:17
Speaker
You have to strengthen the policy. The loan just goes away. You don't have to repay it. There's no recourse to your credit score or that. Unfortunately, we had some clients that have had to do that, but they got all their money in. They loaned out all the money that they had put in over the life of the contract. They were really in a nowhere situation than they would have been. Life kicked them in the butt. They had free life insurance for three to four years.
00:48:41
Speaker
What happens to my policy if the market goes down 50%? I love this one. This is maybe one of my favorite projections.
00:48:48
Speaker
I would be far more concerned about your 401k and your job if the market goes down 50% than your life insurance policy. The two main carriers that we use, one raised their dividend in 08 and 09, and one's held the same dividend rate for the last 10 years. So these companies have always paid dividends, even through the Great Depression. I would argue that 08, 09 was a depression.
00:49:15
Speaker
The entire financial system was on the brink of collapse, had the Federal Reserve not bailed out Goldman Sachs and some of these other companies. We experienced that within the last 10 years and all of them came through with flying colors. Not only that, but our clients were in a position with guaranteed cash value that earned non-taxable interest and they were in a liquid position to go and buy assets at a 50% discount.
00:49:44
Speaker
Fire sale. Fire sale. Awesome. Okay, so why would I borrow from my policy, which is 5%, being honest, instead of going to the bank and taking out a loan of 2%? Yeah, so this is again where people look at this in a silo and they miss, in my opinion, the bigger picture.
00:50:05
Speaker
But when you are consistent in grouping your cash flow together, so like Phillip talked about, making your car payment. Let's say you put $500 a month in an emergency savings account. You've got car payments of $400 a month and you've got some stupid products you bought that you need to read. Can we change that, the car payment to $300, specific with the same example?
00:50:28
Speaker
So a car payment of $300, savings of $500, and then you got some insurance that's not really designed correctly, you're paying $100 or $200 a month on. So let's just say it's $1,000 a month. By doing all of that money and putting all that money through your life insurance policy, you could be compounding on $1,000 a month. If you put $500 in the bank, it's just $500 in the bank.
00:50:51
Speaker
your car payments going away from you, the other life insurance products probably going away from you at some point. And so you're really only building wealth on $500 and it's not really doing anything for you. Versus compounding in a guaranteed non-taxable environment with a company that's always paid
00:51:08
Speaker
dividends at $1,000 a month. And so when you start streamlining your cash flow and you see the efficiencies we can gain by going through our process and you start making those payments back to yourself, again, this isn't to Philip and I, this is to yourself and your own policy.
00:51:26
Speaker
The interest rate of making those monthly payments like that isn't 5%. When you pay a loan like that, 5% is the worst case. That's if you never made one loan repayment for the entire calendar year, the year is up, now you owe 5% interest. The $10,000 loan, that's $500. But if you're paying a loan payment every month at a much faster clip than you would have because we've helped you synergize your cash flow,
00:51:54
Speaker
the actual interest rate is probably two and a half to four percent. And it's actually probably commensurate with what you're paying at a bank or in credit. So let's just talk about that quickly because you just took out, you just put $10,000 in the policy, you just took out seven, you just paid off your car, and now you have that $300 that you were paying to that car going back to the policy. Then we would probably advise you to take some of that 500, if not all the 500 that you were saving in the bank
00:52:19
Speaker
Combine that with the 300 and now you don't need that life insurance policy. I wasn't really helping you at $200. So that's $1,000. So at $1,000 a month, you're paying back that policy. How many months would it take to pay off that $7,000? This isn't rocket science.
00:52:34
Speaker
It's seven months, right? That is quickly faster. It's way faster than you ever would outside the policy. So that's why we said, and on top of that, you get a death benefit. And it's been sitting there like it's been compounding the whole time. So kind of a cool idea. All right. So that's why you would probably want to borrow from the policy. But that's not to say that we haven't leveraged the banks in these comprehensive plans that we've done. We definitely have in the past.
00:52:59
Speaker
Let's jump to how is interest calculated on the loan. I think this is an important one. Especially right now. Perfect. Most loans, let's just stick with the car loan. Let's just work backwards. So mortgage 30-year, obviously the balance is advertised over 30 years and you pay for your house twice in interest. We've all heard that.
00:53:16
Speaker
But we don't really change your behavior, unfortunately. It's all front loaded. Yeah. So you're paying a way bigger chunk of the interest up front. Car loan is somewhat similar, typically on five-year. Now we have these seven-year car loan notes.
00:53:31
Speaker
which should be interesting, see what happens with that. But cars are lasting longer too. But anyways, yeah, the interest is front loaded. And so the main difference is the interest is calculated the same on a life insurance policy and like a bank loan from like a daily rate of interest.
00:53:51
Speaker
The difference is the insurance company doesn't amortize it over a period of years. So it's just kind of like a line of credit or a credit card. The faster you pay off the balance, the faster the interest goes away. And so that's kind of the power of it. And so the faster we can streamline your cash flow is going through our planning process.
00:54:13
Speaker
and we can free up your ability to save money the faster we can repay debt and get these banks out of your life. And so they calculate interest daily, basically. So if you take out a $10,000 loan on the policy anniversary and you don't make one loan repayment, you owe $500. It's just kind of a simple interest.
00:54:31
Speaker
But in that, if you start making a payment every month, well, then next month, let's say you made that $1,000 payment on your example of $7,000. Well, next month, they're charging you interest daily on $6,000 and then $5,000 and then $4,000, you get the idea. And so, you're paying smaller interest on a smaller balance.
00:54:53
Speaker
That's kind of the inherent difference. And then obviously, we get the policy built up to where you have $100,000 in cash value and you're only taking out a $10,000 loan for a car. Well, now you're earning dividends and interest on $100,000 and only paying interest on $10,000. And that's where the math can really start to get a lot more fun. For sure. Can the government or could the government change the tax treatment on this literature?
00:55:16
Speaker
Love this one, always. They've made several legislative changes to life insurance, the big one instituting the modified endowment contract, which limits how much you can overfund a life insurance policy. But when you look at the tax legislation we just got, no mention of life insurance, upheld the tax protection of life insurance.
00:55:41
Speaker
And for the most part, like we said, 99% of people aren't doing this. And so a lot of people don't have a massive amount of money built up in casualty life insurance. It's in 401k, it's in real estate. So I think they're going to go after those tax places first. But even if they did, the last legislative process grandfathered pre-existing policies and protected those as a class. And then two,
00:56:07
Speaker
all your money is in that environment now. You're back to where we started. You're going to have all your money liquid to you and you could move from there to any other instrument or vehicle that you wanted. You can buy term insurance. I wouldn't advise that, but you could take a loan and move your money.
00:56:26
Speaker
There's always a way out, I guess, in that argument, but all your money is in that argument now, so I'd rather bank on the fact that they don't come after it. Then the last thing I'd say is a lot of banks, corporations, and wealthy people own cash value life insurance, so I don't know that they're going to change the rules on themselves. Let me say this. Let's say there's a listener out there that doesn't have any debt. Can they still do this concept? Should they do this concept?
00:56:50
Speaker
I would argue, yes, because it's a way to get multiple uses on your money. Typically, those types of people like sitting on excess cash and they're not really earning any interest on it. Typically, they might need a death benefit for state purposes or legacy purposes. This would provide that. And then, two, would actually give them the ability to leverage against their cash position and add additional sources of residual income.
00:57:20
Speaker
Life insurance, we've always heard this, we've heard this many times, is inflexible and rigid. Would you say this concept is the uncommon thinking? No, I would say if you buy whole life the way everyone else is doing it, then it is rigid and inflexible because you don't have cash in there. But when you infuse the policy with as much cash as we can without becoming a modified endowment contract,
00:57:48
Speaker
which basically just turns the policy into an annuity from a tax perspective. If we maintain that environment, it's incredibly flexible because we have cash to change, to maneuver. When you don't have cash value and you're locked into a high premium situation, then you're in a problem situation.
00:58:12
Speaker
All right, so last one that we'll talk about today, and if you guys ever have any questions or want to reach out to us, please do so. But we'll go to why would someone backdate a life insurance policy? And there is such a thing as backdating. Brian and I first were doing this, and he talked about backdating. I was like, why would you ever do that? Because you're alive. You're just buying life insurance. So it's kind of like saying, hey, I'm still alive, but I want to backdate because I've
00:58:39
Speaker
Six months ago, I'll pay for six months ago like I was paying for the insurance, but I'm still alive today. That was a question I had. I want to be careful on this from a compliance standpoint. We do backdate quite a few policies. The insurance companies, I'm just going to say, don't like it.
00:58:58
Speaker
because it accelerates the amount of basically what they have to do. It shortens their time scale and insurance companies just don't like that. But typically, yes, you can backdate. Typically, it's to save age. And so if someone's about to turn 40, we could secure a rate by going backwards
00:59:18
Speaker
three to four months and secure age 39, it locks in their lifetime guaranteed rates for insurance at that 39 year old rate. So we're gonna say it's under the premise of saving age to keep the cost of insurance down. But what it also does from a banking strategy is allows us to interject two premium payments into the policy in six months or less, depending how long underwriting takes. And so what that gives us the ability to do
00:59:48
Speaker
is just accelerate the banking system for our client, which is to typically get out of debt or purchase assets. For sure. And all this is definitely subject to underwriting and the comprehensive plan for you and your specific situation. But we do have a carrier now that is okay, depending on the situation, but not doing the PML.
01:00:14
Speaker
all that stuff. So that's kind of a nice, I guess, incentive for some people who are like, I don't want needles. We kind of have that idea. So guys, this has been awesome. We've gone a little bit long, but I hope this is something that intrigues you a little bit. It's definitely something that as you guys can understand, Brian and I geek out about this stuff. And we've seen it so many times, time to time again, how much it's helped clients, how it's put marriages kind of on the same playing field.
01:00:43
Speaker
of gaining traction in their plan. So we hope this is something that you guys will start leaning into a little bit more. You won't get super freaked out like Dave Ramsey does about this stuff. There is a way that we can definitely integrate full life insurance into your plan to help you with the seven sources of residual income. So I'm your host, Phillip Ramsey. And I'm Brian Dewhurst. Guys, cue the music. We'll see you next time. Thanks again. Bye-bye.
01:01:09
Speaker
That's all for this episode of the Uncommon Life Project, brought to you by Uncommon Wealth Partners. Be sure to visit uncommonwealth.com to learn more about our services. Don't miss an episode as we introduce you to inspiring people who are actively pursuing an uncommon life.