$1,000,000 dollar nest egg regardless of income
How the 1% have been growing wealth with a tool everyone has access to.
I’m so excited about today’s topic. It is one that I use for my family and something that has supercharged our wealth building.
Today you’ll become your own bank and instantly provide your children with a multi-million dollar nest egg just like the 1% do.
Most people don’t know what they don’t know, and too often we can fall into the trap of “I can’t” instead of asking “how can I” when it comes to wealth building. Many financial advisors also fail to provide their clients with a complete assessment of what is available to them, instead focusing on “what is typical.”
If you want to build generational wealth and ensure your family’s well-being long after you’re gone, then this is for you.
Building a multi-million dollar nest egg
Your guide to infinite banking…
Why you need life insurance
How to use it the way the 1% do
A little trick that defies conventional wisdom
Why You Need Life Insurance
Life insurance is often seen as just a safety net, but it can be much more than that if used correctly. In fact, it can be a powerful tool for building and preserving wealth.
By setting up a life insurance policy, you can ensure that your family is financially secure even after you’re gone. Life insurance provides a death benefit that can cover debts, education costs, and living expenses, giving your loved ones peace of mind.
My wife and I each have 2 life insurance policies that will provide each other and our children over $15,000,000 if something were to happen to us. This is many multiplies above our net worth today creating a huge early safety net.
And the death penalty is not even the best part, nor is it the true value we expect it to yield years from now. In fact, it is just the minimum.
Whole Life Insurance and Index Universal Life Insurance are policies in which their cash value is invested in index funds to yield compounding interest growth. You heard right, an insurance policy that grows in value, but there is more.
How to Use It the Way the 1% Do
The wealthy use life insurance differently than most people. They utilize a strategy known as Infinite Banking, where you essentially become your own bank.
This involves overfunding a whole life insurance policy to build up its cash value. This cash value can then be borrowed against for various purposes, such as investing in real estate, funding a business, or paying for major expenses (I sudden media emergency, a personal loan for renovating a home, etc.).
By borrowing from your policy, you avoid traditional bank loans and the associated interest rates. But that’s not the value part. When you borrow money from your life insurance policy that money remains in the associated index fund and ideally covers the “interest” you technically owe yourself. So your money keeps growing.
Now, if you borrowed the funds for an investment (the best use case) like real estate it can simultaneously grow even further, faster.
This creates a cycle of wealth growth and preservation that the 1% have been using for generations.
Lets review the power of Infinite Banking…
Tax-Free Growth: The cash value of your life insurance policy grows tax-deferred, meaning you don’t pay taxes on the gains as long as the money stays in the policy.
Compound Interest: The cash value continues to earn interest, compounding over time and accelerating your wealth growth.
Access to Capital: You can access the cash value of your policy through loans (remember it’s your money not the banks), providing a source of funds for investments or emergencies without having to liquidate assets.
Protection Against Market Volatility: Life insurance policies are not directly tied to the stock market, providing a more stable growth platform.
A little trick that defies conventional wisdom
Google and the average Life Insurance broker will tell you that you can not fund a life insurance policy with "qualified money" (aka an IRA/SDIRA). But taking this at face value leaves a tremendous tax savings opportunity on the table.
There is a little trick by which you can "reclassify" the "qualified money" by first rolling the funds into a Solo Checkbook 401K (my wife and I used Solera Bank for this). Then, by forming an acquisitions LLC you can LEGALLY use the Solo 401K money to CAPITALIZE the acquisitions LLC. With the funds now reclassified as "non-qualified" the LLC then funds the insurance contract.
In essence, the LLC is deciding to protect its fiduciary (you) by purchasing a life insurance contract.
Think about the tax advantages here. You fund a life insurance contract with tax deferred money, you grow it tax deferred and then you take loans against the policy for anything (investments, bills, purchases) to avoid distributions.
This is financial planning on steroids!
I am not a financial advisor or life insurance broker, I am only sharing my strategies as information. You should consult with the appropriate professionals to learn more about this approach and if and how it could be useful to your financial planning.
Don’t wait to start planning for your future.
See you in next week,
Jon
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