Cashflow Over Net Worth Case Study

Hello and welcome everyone. We are officially live on YouTube. We're live on my channel and Daniel Romberg's channel, Nation's First Financial. So I just want to formally announce we've got an official partnership together. We've been working together for years now, a couple years. But now we're bringing both of our channels together to bring this information, bring this education, and provide, you know, resources on and offline where you can connect with me personally and/or our team, Daniel's team, Nation's First Financial, based out of Arizona. With that being said, tonight we're going to be doing a full-on case study Cash flow over net worth. This is the the theme, the model, the framework that I've been teaching for the last pretty much eight years. It started with teaching velocity banking, helping people accelerate their debt, increase their cash flow, rebuild their credit, putting them in a position to save more and invest more money. It then you know grew to velocity banking and Combining the infinite banking strategy, where once you've paid off certain debts and you've got your cash flow to a certain amount and you, you have your finances under control, you're spending less than what you make, you're being a good steward over your money, the next phase is, okay, where are we saving money and how can we improve our savings? That's where infinite banking came in. where we can design properly structured whole life insurance policies, which allows us to grow our money faster, more efficiently, comes with death benefit protection, living benefit protections, liquidity, tax-free growth, guaranteed, you know, growth projections, and non-guaranteed dividends that have paid for over 150+ years. And then to begin to incorporate leveraging the cash value That can grow in 2 places, and then that goes into investing. And now, as it's coming full circle, after helping thousands of families get their money right, the, the next big thing is retirement planning, income planning, taxes. And that's where Daniel's team comes in, where they can help on the tax strategy side. They can help with all of your qualified retirement accounts. They can help with, you know, creating tax-free income vehicles and passive income vehicles and guaranteed income vehicles, and really just putting all the pieces together so that we can enjoy retirement, fulfill our purpose post-retirement, and retire on time, and even in some cases retire early. So today we're gonna take it straight to the whiteboard. I'm gonna give you some details. This is a scenario that's playing out in real time. All right, I'm gonna start with the 4 major numbers on the left-hand side of the board. We have an individual, 47 years old, making $14,328 a month on average. Their expenses are $13,252.29. We have a total debt of $204,240.55 with a cash flow of $1,075.71. That's going to be on average. As it stands today, this is prior to this person becoming a client with me. And now we're working together. So I'm giving you the facts here. Person on the board here has a credit score ranging between 569 and 578 across the 3 bureaus. Prior to meeting me, they started funding 3 different whole life policies on themselves. So they're familiar with infinite banking, they've worked with other agents, In the past. So altogether, they have a total death benefit— this person has a total death benefit of roughly $878,000 across 3 whole life policies. As of today, we have total loans outstanding, so that means we've been borrowing cash value loans. Total is $49,000 and some change. And every year on average, they're funding their policy between premiums, PUAs, loan interest, and loan repayments altogether roughly $41,715.96. So, so this number that they're funding, I've incorporated it into their expenses. So the $13,000 that we're spending on Lifestyle expenses, debt payments, savings, it's all factored in. And in addition, there's still some money left over. Here's the goal. This person wants to transition out of the healthcare industry, transition into coaching. They want to pay off debt. They want to, you know, fortify their infinite banking, build it up, you know, get more policies, and also incorporate velocity banking. So here's the, the, the obstacles in their way. First is we have very low credit, so therefore we're not going to get qualified for the correct line of credit at decent interest rates in today's environment. So that's problem number 1. Problem number 2 is we're carrying a lot of consumer debt, a lot of revolving debt which is in high utilization right now. So we have high utilization debt across many different credit cards—

1, 2, 3, 4, 5, 6, 7, 8, 9, 10—

and this is not including other debts that they have. I'm simply focusing on all of the credit card debt that this person has. So high utilization High credit card payments, ton of cash flow is being stripped out of their economy. When I look at their total expenses, I should say total debt payments, right?

So we're gonna go like this real quick, and my marker is dying here. Might have to switch it. So total debt payments, we're putting out $5,577.99.

So that is what? That's a nice 30% or more of our income roughly is going to debt payments, right? More than 30%, I think it's 40.

Let me do—

yep, roughly 40%-ish, uh, is going straight to debt payments. So that's a cash flow crunch. And we're gonna look through and evaluate the different options on the table. How can we go about attacking the problems that are right in front of us and then shifting towards the next set of goals, which is transferring out of the healthcare business. In order for this person to transfer out of the healthcare business, we have to create another income stream somewhere else to fund that transition. And then whatever we're transitioning to, we have to create this active income, this active activity income to support that transition. And there's tons of different ways that we can go about doing that. So what we're going to do in this session here is we're going to solve For the immediate problems at hand, and we're going to evaluate the breakdown of what needs to occur in order for all this to come together. Right.

My markers are failing me right now.

So for this household, here's, here's some of the things that I'm looking at that I'm paying attention to. That's going to help me like put all of this together. So I look at your total living expenses, not including debts. What does it cost to live your life today? For this person, it costs them roughly $7,674.30 So I'm gonna round up and use $7,700 to operate, to live. That's what it costs for this person to live, $7,700. If we didn't have any debt whatsoever, you minus the $5,577. So if I'm bringing in $14,328, Minus five thousand five seventy seven ninety nine cents. That would mean we'd have eight thousand seven hundred and fifty dollars and a penny, right? Of expenses, right? So the the difference. Let's take a look.

Let me come back over here and make sure I got my numbers right. I might have did something wrong here. Yep, nope, I have that right.

So $8,750 and a penny, and then you minus $77 Right, $1,050. Okay, all right, so living expense $7,700, $14,328 coming in because I'm overestimating. If I want to transition, I'm a W-2— this person is running their business actually, so they, they have an LLC, they're 1099. They have some very, very small amount of this money is passive, very small amount. And we're currently 47. We've got a— we created a window together about 5 to 7 years. And let me see if I can get another marker real quick. Because these things are failing me this evening, unfortunately.

Let's see if I can get this one to work.

So transition to coaching.

Yeah, there we go.

5 to 7 years. That's our window. Ideally, anytime I'm working with anyone, I usually like to set that window, whether it's becoming debt-free, creating financial independence, shooting for financial freedom. How much can we achieve in a 5 to 7 year window realistically?

Right?

I'm an optimist, but I'm also very realistic in a way. And depending on the person's attitude, demeanor, motivation, what's inspiring them, industry that they're transitioning into, what would need to occur to make these things happen, right? So if—

let's go, let me use that number again.

Minus 5,799.

So this, this difference, $8,750, would be the cash flow remaining if I'm debt-free, right?

This is so from a debt-free position, if we can remove All this credit card debt plus more debt on top of this, because I'm again I'm not showing everything here. I'm showing the total debt payments. If you add everything up, it's going to be less than that number. There are some other debts that we owe that's not being shown here. We would have this thousand fifty left over of of cash flow plus. This money here, all cash flow now, making $14,328. Once that occurs, we begin to plan on creating enough of capital cash savings. I would like to see Anywhere from 6 to 12 months saved, and in his case, this would be saved in cash value. Alright, cash value accounts. So if I got 6 to 12 months of Expenses times 12, that would be $92,400. 12 months, that's like the most.

77 times 6, $46,200.

Anywhere between as low as $46,200, as high as $92,400 would be my target. That says, okay, now that we've eliminated all these obligations, we're able to save the difference in debt payments, just, just park it in these whole life policies, pay back the loans in there. Build up the cash value, and I'm still making the $14,328. Technically, at this point, however long it took me to pay off debt, and we're still working in the healthcare space, and our expenses stay around the same, $7,700 a month, transitioning into coaching, I technically would only need that active income, if I'm going to become a coach in a certain field, I would need to make minimum, say, $8,000 or more per month. All right, so coaching would be the standard $8,000 or more monthly would be the, the standard. This would allow this person to continue to save what they're already putting into their whole life, operate all their personal expenses and obligations. They'll have tons of debt capital available to them because they'd be debt-free at this point, and they can fully focus once their coaching business, whatever they transition to in the coaching industry, is generating at least $8,000 or more or close to it. That would give them financial permission because you can take risk obviously by, by leaving sooner, quitting your job, and then taking a risk and going all in on something else. But if we looked at it from the financial perspective, what would give this person financial permission to walk away from a high-paying career in the healthcare space, which— of which they have 12 years of experience, 12+ years of experience, to then move into a completely different industry that has its own Set of risk. Ideally, you want to be at this number, $8,000 or more. So we set the parameters: have about 6 to 12 months worth of cash just stacked, saved to protect your income, and be generating $8,000 or more before you leave that job. Let's say we set those standards. So we have the end in mind. Now, how do we get there? What's the most efficient way to get there? And we come back and we see, okay, what are the problems? What are the obstacles at hand? Low credit scores, very high interest rates, high payments, high debts. Let's name all of the different ways to get out of debt. All of the different ways that you and I can pay off debt today. What is that? Debt snowball, debt avalanche are your 2 most popular. So if we were to do debt snowball, you start with the lowest debt, $2,407.98. $50 is the monthly minimum payment. Cash flow is $1,075. You make an extra payment. On the due date or sometime in each credit cycle, you're making extra payments of $1,075, $1,000 or more, and going one by one by one by one. Now, in my experience working with people, human beings, not spreadsheets, not Excel sheets, those are valuable. But in my 8 years now working with human beings all over the country, all different walks of life, all different backgrounds, what I have found that works the best for people is whatever they can comprehend. So if I'm teaching one financial strategy But the person I'm teaching is having a difficult time comprehending the strategy, then I'm going to deploy a different strategy, even if math on a spreadsheet would prove my original strategy to be better on paper. But if the person doesn't execute it properly, Then what's the point of being right if at the end of the day the person's not going to do it, or the person's going to attempt to do it and do it wrong and actually hurt themselves more? What you're witnessing here on the board is an— you know, not to throw this person under the bus, but it is an example of lack of accountability, lack of coaching, lack of support to be put in this kind of position where you take on this kind of debt over a period of time, maybe incorporating 2, 3, 4 different financial strategies all going in different directions. All right, so again, when I am speaking with you one-on-one, I am evaluating the individual in real time I'm seeing where they're currently at, how I'm meeting them. So looking on the board here, think about yourself and me putting you on this whiteboard with your financial numbers and situation. I'm gonna draw some conclusions, not, not to judge the individual, but to just simply evaluate the facts. Hey, the facts are, when looking at this case, this individual's— this individual is a high-income earner. And they also spend nearly everything they make. They have some money left over. They're funding policies, but they've borrowed out a lot of money. They only have about $5,000 in cash value available. We have a ton of credit card debts and more debt on top of that. We're not a homeowner. This isn't a married individual with kids. So I could draw some conclusions here and say, all right, I would say this person has maybe multiple influences in this person's life, multiple things that attract them to spend money in different areas. Whether we like to admit it or not, here are the facts, right? So I'm gonna take all of that into consideration, and I'm gonna build strategies In levels. Level 1, level 2, level 3, level 4, level 5. So when we think about the different ways of getting out of debt— debt snowball, debt avalanche— those are your 2 most basic ways of getting out of debt. You literally cannot go wrong. So that's why I listed it in this way. That just shows, all right, if you just follow debt snowball You're going to make progress. 2 months, that's gone. 2 more months, that's gone. 2 more— 2, 3 months, the next card is gone. 4 or 5 months, the next card is gone. 4 or 5 months, the next card is done. 5 months, the next card is done. 6, 7 months, the next card is done. And it just keeps going. And that would take a couple of years to knock all this out. No doubt. Debt avalanche would have this person start here with the highest interest, 34.24%, then 30, then 29, 29, 26, right? And work your way through it, and they'll go a little bit faster than, than debt snowball. Then these numbers over here are cash flow index. Cash flow index, you go with lowest cash flow index score and work your way up, right? So the first debt that you would tackle would actually be the one that has the largest balance according to cash flow index, 26.94, right? It's actually this one, 25.68. So it'd be this card, 10/5/06.

So 1 and then 2 and then 3, right?

And you work it in that, in that order. So we went over debt snowball, lowest balance to highest balance. Debt avalanche, highest interest to lowest interest. Cash flow index, lowest index score to highest index score. In order to calculate cash flow index You take the balance owed and divide it by the monthly payment. You should get that number. Take the balance, divide by the monthly payment. You should get that number. If the number is below 50, that's an attractive debt to pay off. If it is above 50, it's less attractive to pay off. You go from lowest to highest. Makes sense? And then we have velocity banking and infinite banking. Now, this person wants to do velocity banking. When I work with clients that want to do a financial strategy, again, I look at the facts of the situation. I evaluate where the person is at, their ability to actually do it, and the way I test them is by doing pregame work. So far, This person has been successful in doing pregame work. They're coaching with me one-on-one. They're listening to my instructions. They're knocking out certain debts that would strategically position them for velocity banking at a later point in time. So on the right-hand side of the board here are the factors that would need to take place Before we can incorporate velocity banking. Credit repair is step number 1 because their credit scores are really low. So this person, part of their expenses, they're spending $120 a month with me and I'm helping them repair their credit. I have a credit repair service. That if that is something you want to do with me, I can help you with and coach you along the way. $120 a month. It's $99 a month to get access to an AI software system that's going to guide us in credit repair, and then it's $19.99 a month for smart credit monitoring. And so it's 2 subscriptions that you pay monthly. You get coaching. support and accountability along the way of repairing this credit. So this person paid for that. They're incorporating it with me one-on-one since they're already doing infinite banking. In a sense, they're not really doing infinite banking to its fullest potential in the most efficient way, right? Right now they're just simply paying for the asset. They're funding the asset. They're in the early years of the asset, so we're going to keep doing that. $3,476.33 monthly roughly is going to those 3 whole life policies. Again, it's part of the expenses. They're watching my content, pregame work for Velocity Banking. Once we get credit Credit scores, they need to rise 720 or higher. We would then acquire a personal line of credit and we would leverage 0% credit cards to then incorporate velocity banking. And because they already have infinite banking— infinite banking is another way of paying off debts, another strategic way. To accelerate debt, that by that point we would actually combine the 2— velocity banking and infinite banking coming together.

So here's what I'm gonna do.

I'm gonna erase this part over here, give myself some more space, and begin to show you guys a little bit more in The steps and process that we're, that we're taking. So as you know, we're repairing credit. We're investing in credit repair to get the scores up, to get access to the right tools to do velocity banking at a later point. Meanwhile, while that's going on, we are incorporating a little bit of Cash Flow Index, a little bit of Debt Avalanche. A little bit of debt snowball, all together in a very strategic way to boost credit. And let me show you the example here. We are incorporating right now— we're gonna be starting it up— the 3-payment strategy. I've been talking about this a lot lately because it works really well, gets results like within 60 days in terms of building your credit. We are going to target the highest monthly payments on the revolving debts. that this person has, the revolving debts that this person has. So as you can see, there's 5 credit cards here that require the highest monthly payments. What we're gonna do, and again, this, this is a slow build to see how people perform over time, and then we can, you know, obviously ramp it up. But we're going to incorporate the 3-payment strategy on the largest revolving debt that they have and the largest revolving monthly payment. It happens to be the same debt. $29,886 is owed on one credit card. It's maxed out, and the payment is $1,109. So here's what we're going to do. This card is due— so the due date is the 8th of every month.

Follow me?

Everyone's got due dates on their credit cards. Take a look at them and do this with me. For your own numbers. This strategy is great for people who are not doing velocity banking. If you are doing velocity banking, you have a HELOC, you have a debt tool, this does not apply to you because we're doing things differently. You've already done the pregame work, so you don't have to do pregame work if you're already Doing the strategy. Since we don't have the right line of credit yet, this is a pregame work strategy that we're incorporating, which also is like a triple effect. It gets us ready for velocity banking, it improves our credit score faster, and it gets us out of debt faster as well. So we take that payment, $1,109, and divide it by 3. You get $369.66. We're gonna round up and just call it $370. I'm recording this video, it's September 18th today. The next payment is October 8th for this credit card. The 3-payment strategy says you make a payment on the due date like you normally would. You make a payment 15 days into the cycle, right? Or you could say 15 days after the due date, which is right smack in the middle of that credit card cycle, and then 3 days before the due date. So the 5th, to make it easy, we would just say the 5th of every month. We do 8 plus 15. And we say the 23rd of every month. These are our 3 strategic payments that we're gonna make on this credit card. Now, because this person has cash flow of roughly $1,000 and slightly more each and every month, we're going to make an additional principal payment On or after the due date up to $1,000, give or take. That's the strategy, that's the plan. What this does is when this credit card reports to the 3 bureaus that this person made a payment, they didn't just make 1 payment, they made 3 payments. We're creating a character profile for this person, and it's going to increase their credit score faster than making a large payment one time per month on the due date. So we get the advantage of improving credit score faster. The faster we get our credit score up, the faster I get to the line of credit. The faster I get to the line of credit, The faster I can pay off debt. Make sense? So I'm thinking long-term and short-term. In addition, when we make a payment, $370, $370, $370, starting this month, it's September 18th. If this person makes a payment on the 23rd, This $370 is 100% principal. If they make another payment on the 5th of October, that's 100% principal. And by the time they make a $370 payment on the due date, That will be more to principal, and the rest would go to interest. Let me show you the mathematical impact of doing that. It's not going to be a big number, but over time it does make a difference, right? So we owe $29,000. $1,886. Times that by 26.74% and divide by 12. So per month moving forward, they're paying $665.95 of interest cost in just one month. So that $1,109 $665 goes to interest. The rest, principal. So $1,109 minus $665, there's only $443.05 went to principal. The rest went to interest. There's an imbalance.

Right?

If I make $370 and $370, that's already $740 to my $443. You see that? $740 minus $443, that's $296.95 more. That went to principal rather than interest. That's, that's a sizable impact. You guys like that? Let me know in the comments. Is that— let me know if you see that. Let me know if you understand that. Specifically when we're talking credit cards, revolving debt. Credit cards. When you make a payment before the due date, nothing goes to interest. The only time you pay interest is on the due date. That's it. So if the payment is $1,109 and I already made $740 of it, $1,109, Minus $370 minus $370, 2 payments, that's $369 left. All right, and because we're rounding up, as that's like a, you know, an extra dollar roughly of interest because we're rounding up. So now of that remaining payment on the due date, That's that's what's left of which would be charged interest in that one month. That makes it that makes a sizable difference in a very short period of time. Okay, so instead of paying, say we go twenty eight thousand. 29,886 minus 370 minus 370. Okay, so now we're at 29,146 times 26.74% divided by 12. 649.47 roughly is what is going to be charged of interest on that debt. Now it's going to be smaller than that because of the timing, right? We're breaking this up and we're also making a principal payment on the due date of $1,000. So that's also going to Knocked that interest down quite a bit, quite a bit. So now that you see the impact of that difference in how the money gets applied, we're saving money on interest, we're paying down the debt faster, our money is being used more efficiently, and our credit's gonna start to jump. We're gonna start seeing the credit score jump. A little bit faster. So the 3-payment strategy can technically be incorporated with all 10 of these credit cards. Now that takes 10 payments times 3, that's 30 payments you would have to manage every single month. You can create automation by calling each of the credit card companies. That would take time. And you would tell them to divide my $50 payment out over 3 payments, divide my $82 over 3 payments, and you can set it up with, with all of the credit card institutions that, that you own with. It's a big undertaking. It can be a bit of a headache. It can take some time, but that, that's not a limitation. That's, to me, that's just an excuse to not do something. But I also don't want to overwhelm people because I understand we're human beings. That can be overwhelming. So we're going to start with one. Depending on how this person does over the next 30, 60 days, they incorporate automation with this so that they don't have to think about it and it starts to roll out pretty well. Then I'm going to tell them, hey, If you're comfortable, let's do the next card. 502 divided by 3, round up to the nearest dollar, and that's it. You don't make extra payments on top of that. You just round up to the nearest dollar, and we're driving the rest of our cash flow towards one debt out of— at a time because that's Going to increase our cash flow because now the payment's going to reduce each month. So after doing this of one month, that $1,109 is going to come down. It's going to reduce. But now the following month, we're going to keep paying $1,109 to that card because right now it's less about paying things off. It's more about paying things down strategically. So we're gonna do this on this card until the balance hits below 30%. So that would be the target, $29,886 times 30%. Our goal is not to actually pay this card off. As it pertains to repairing credit, our goal is to bring it below 30% so that our utilization can adjust, adjust with the credit bureaus and our credit scores can go up. If I bring $8,965.80, times that by 26.74, percent, our interest goes down to $199 a month. And at, you know, 2% of the balance, let's say our payment's probably like $200 at that point. So once we bring the balance— so target balance Doing 3-payment strategy. Target balance 30% on all credit cards, 30% or less. That's what we would do, and we start with the highest card. And work our way down because that's where the bulk of our utilization is at. The smaller cards aren't really making that much of an, of an effect. It's really the bigger cards that have big credit lines. So if we reduce those credit utilizations, it's actually going to improve these. And by the way, we're still making the regular monthly payments on everything else, so those balances are going to come down. All right, and that's gonna make an improvement. We're gonna do this for the next 6 to 12 months, or whenever I hit 720 or higher across all 3 bureaus. The moment I hit 720 or higher across all 3 bureaus, we would evaluate where we're at. And then we're gonna use our credit. So now, I'll erase this, but I'm gonna share my screen and take you to the next step, which is the next pregame work of velocity banking, which is getting the tool now. So now that I've got the person's cash flow a little bit higher, right? I got their cash flow higher. Their credit score is higher, they're incorporating the 3-payment strategy, that's working, everything's working good, everything's going according to plan. Now we have to acquire the debt tool. Which would be a personal line of credit. This person is not a homeowner, so our next best tool is gonna be a personal line of credit.

So here we go, share my screen.

We're in the state of California, that's where this person is located. So we are going to—

let's do this. And make sure I'm sharing my screen.

Let me know if you guys can see my screen.

Just making sure. I just need one comment. Just let me know. And that should be the trick. Okay.

So I found a bank, San Francisco Federal Credit Union. I found multiple other banks in the state of California that also do personal line of credit, but this bank in particular is showing the lowest rate out there in the state of California that I've seen so far, which is as low as 10.5%. I know that if their credit is 720 or higher, that puts them in prime position to get the lowest rate. So I'm going to use that 10.5%, and because this person is a high-income earner, I'm pretty sure we can get close to a $50,000 line of credit, but I'll go in the middle and we'll say $30,000. So we're gonna use these numbers in the state of California. Let's say we get approved for a personal line of credit. Let's say for $30,000 at an interest rate of 10.5%. And let's say in 12 months, 12 months went by. This person would have funded their policy another $41,715.96. This person is already 2, 3-ish years or so into their policies, so the majority of what they're funding at this point would be going to Cash value growth, right?

So I'm gonna—

but I'm gonna underestimate that person. I'm gonna say $41,715.96, and I'm gonna times it by 85%, and I'm gonna say a $35,000 increase to cash value. On top of that $5,595. So plus $5,595. So I'm gonna say that this person would have saved up $41,000 or more cash value available across their 3 policies. We have, we have a $30,000 personal line of credit at 10.5%, which is at a lower rate than all of these debts. And over the same 12 months, we make all these payments.

So $1,109. Let me add all this up real quick. $470. $285, $409, $172, $213, $82, and $50 times 12.

So we're gonna guesstimate over a 12-month period plus $1,000. I'll round down, I'll call it $900.

Okay.

Right, so debt reduction, $40,000. Let's do $9,000 plus $9,000 of reduction. So call it $49,500 reduction of debt.

Principal.

So $49,000.

I'll round down even more.

$49,000 debt reduction.

Okay?

$49,000 debt reduction across all these numbers here. And because our focus was on these 5 debts, Here, we're gonna try to assume that most of that 49,000, let's say, came through here. All right, so I'll take these numbers: 172, 213, 77, 82, 50.

Times 12.

So we'll minus 49, we'll minus 71.

49 minus 71. So, oh, minus 49 minus 71.

So 41.9 left. And we'll apply it.

1, 2, 3, 4, 5.

Let's strategically apply it across 5 debts. $8,380. No, let's not do that because we need to bring our debts— we need to bring everything below 30%. All right, so we'll do it that way. Let's say in 12 months we can successfully reduce these 5 balances Down to 30%. I think that's very possible, but let's, let's prove it. Let's see if it's possible. 29,886 times 30%, 8,965.

So 8,965, 18,974. So 5,692, 17,735, 5,320, 12,023, 61. 3,607 and 10,506, 30%. So 31,5180.

If we can successfully do that, In a 12-month period, which I think is very possible. Let's add up those numbers: 31,58 plus 8,965, 5,692, 5,320, 3,607. That's 26,000 left. 26,000.

$735 left to chunk.

We could totally chunk that on the personal line of credit, and you remove $2,619, $1,704, $2,999, $30.74. Into the line of credit. The rest of these five debts, we could consolidate using the cash value. So we can borrow whatever this is, and that'll be IBC. And you consolidate 22, 29, 22, 34, 29. To like 6%, 6.5% policy loan, which ends up being about maybe a 3% net cost because the person is still earning interest— excuse me, still earning interest on all their money. This is cool. 12 months. That snowball is going to take a couple years. Avalanche is gonna take a couple years to remove, pay these things off. If we do credit repair first, velocity banking pregame work, continue saving money in the IBC, in 12 months we can have all of this technically removed and then moved into different locations at much lower cost and recapture all that cash flow. Tell me that's not exciting. Tell me that's not exciting. I think it's very exciting. So let me add the potential balance that would need to be removed over the next 12 months. Based off this number of $49,000. Like, did $49,000, you know, majority going to these 5 debts, right? And then I reduced it down to like $41,000, right? I said like $41K. So minus those 5 debts, like I said earlier, We're gonna— I'll erase this 49 for now, and we're gonna use the 41 number because I said the vast majority we're focused on was those 5 debts.

So $41K.

Let's add this up. So 29,886 minus 8,965, that's already $20,921 would have to go to this card alone over the next 12 months. For that to be possible.

Twenty thousand nine twenty-one, eighteen nine seven four minus five six nine two, so thirteen thousand two eighty-two. And then 17,735 minus 5,320.

12,415.

3,607 minus 3,607. So 8,416, and then the final one, 10,506 minus 31,580.

Okay, 7,354. 20 cents. Let's add all this up.

8,416, 12,415, 13,282, 20,921.

So 62,388.20. That's the difference. We'll just say $62,000. That's the target. Is that possible? I believe so, because I was really, really underestimating my $41K number. I'm underestimating the cash flow. That I used, I would say we could get closer to $62,000 than $41,000. Even if I'm slightly short, there's still plenty of room between a $30,000 line of credit and $41,000 or more of available cash value. So whatever I would be short on the line of credit— And if we use the velocity banking rule, $30,000 times 2/3 is $19,800. $26,000 is the chunk amount required to, you know, consolidate those 5 debts. Um, we would do anywhere between as low as $19,800, maybe as high as $26,000, borrow the difference out of the policy, whatever we're short. You You wanna leave some space in the line of credit. That's very important. And now we're doing velocity banking and infinite banking together at that point. So to be a little more conservative, we could say 12 to 15 month timeline. For this person to Not only get their credit 720 or higher, acquire the PLOC, borrow from the PLOC, pay off a bunch of debt, borrow from the policy, pay off the rest of all this debt, recapture $5K— not $5K, but what, like $2,000, $3,000-ish of cash flow?

Let me see what that number was.

Um, it's $3,816.35 would be cash flow recovers. That puts us Almost like $5K of cash flow. And now you're sending all that cash flow and all that income to the line of credit, paying it down, and then borrowing from the line of credit to fund your policy on a monthly basis. So, you know, things would keep, keep it rolling.

Right.

Now, after these cards are gone, all this person has left is a few personal loans and some IRS debts that would need to be, that would need to be taken care of. But because of credit building purposes, we're targeting the credit cards first. Now, in addition to using their credit to acquire a personal line of credit, that's the first thing I would have them use their credit for. Once they get approved for the max amount, guess what else we could get? A either another credit card or the same credit cards in their portfolio. We could also leverage some sort of a 0% card. So again, whatever I'm short on the PLOC, whatever I'm short on cash value, I can shift more debt into 0%. The whole idea is to get the cash flow as quickly as possible, put it into lower interest rate environments. We're doing a finesse, okay? And this is what speeds up the process. But in order to get there, look how we built up to it, step by step by step, and with accountability. Powerful stuff. So anybody that wants to have a conversation with me One-on-one, I am gonna drop my calendar in the chat for you to book time with me. Let's have a conversation. Let's figure out where you're at. Let's see how we can work together. What are some strategic ways that we can work together? Okay. In addition, because I'm partnered up with Nation's First Financial. I'm able— you're able to leverage my team as well on some of the retirement planning and tax planning. So in addition, this person here is also working with Daniel's team on tax planning, helping them keep more of the money that they make, fixing up their tax returns. Minimizing tax liability, that creates more cash flow as well. So we're putting a team around this individual to help them in all the different areas. So I'm on the credit repair side, I'm on the financial coaching side, the velocity banking side, stewardship, accountability, and then he's getting support on tax planning, income and retirement planning as well. That's where Daniel's team comes in. So if you're watching on Daniel's channel, that's where this became really valuable for those who are listening that are like, okay, not only do I need to solve problems that are right in front of me, but I also have retirement problems as well, right? This is a prime case study of someone who's in their mid to late 40s. They do not have a large retirement portfolio, right? They do not have real estate. So there's other things missing, but those are not the immediate problems right in front of us. This is the thing that we need to solve first, get the clarity on. And this is the theory of cash flow over net worth. If I focus on cash flow in my life, then I don't have to worry about net worth. Because what does net worth— tries to produce a cash flow. But always fails at getting to the adequate number versus if I just solve for cash flow first, I get net worth as a benefit. I get net worth as a benefit.

All right.

So in addition, let's go— let me also drop The calendar link to book time with Daniel's team. So that is in the chat as well. So this link, you will speak with Daniel and his team on whether it's tax planning, estate planning, investment planning, you name it, even some Velocity Banking support. To start putting these pieces together. This is where you get that full support, all these things coming together. Let me know if there's any questions that you have before we go. If not, we'll close out here. I think this was a phenomenal, you know, another example of focusing on cash flow over net worth in your life. When you look at your financial circumstance, most people today are dishing out 30-40% of their income towards debt, and then they're, they're taking what little cash flow they have left over and they're sticking it in this retirement account that's locked up. They can't access it, and it's only earning maybe 6-8% on average minus fees, taxes, and losses. potential losses along the way versus you're getting killed over here on debt paying 30%, 25%, and 30, 40% of your income is, is being drained. So what if we flip the script instead of trying to create a net worth that's going to take forever to then just pay back all these debts at some point, get them paid off, to then hopefully, maybe not, no guarantee, have a certain amount of income in retirement. Instead of going through all that stress, why not consider solving for cash flow first? Transitioning to the type of lifestyle you actually want to live that brings joy and pays you money, pays you well. Why not do that? I think there's so much opportunity right in front of people's faces, and it's things like credit, knowing your credit score and getting that up, accessing capital at much cheaper rates, much cheaper costs to create more cash flow, to recover cash flow, and take that cash flow, you put it into guaranteed vehicles that give you more liquidity. And then when it's finally time to make the investment, you're not just hoping for an average rate of return of 8%. You're investing in something you actually know and understand and can increase the rate of return to 20%, 30%. And then you make, you make up for this apparent lost time that a lot of us are thinking, oh my God, I'm losing time. No, you're not. You just don't have the right strategy. And in the 21st century today, you cannot focus on accumulating wealth. I think it's more important to focus on cash flow because that's ultimately what we're all after— having enough income to cover all our expenses and have more left over to spend freely, guilt-free spending, and/or saving for the A future big expense, investing for the next generation, leaving a legacy behind. So we'll do one last recap and then we'll close out here. Again, reach out to me. Links are there. Let's have some fun. It's important to know your numbers. Let's figure out where you are, where you stand. Let's identify the issues that are right in front of us. Let's calculate the math to have the end in mind and figure out how to get there in the most efficient way so you can live a life more intentional. Incorporate the strategies needed. Test ourselves with strategy. It's okay if a strategy you're not comprehending and you don't get it. We can do something else. If this person didn't understand cash flow index and didn't understand velocity banking, I would be teaching them debt snowball. I would be teaching them Dead Avalanche, and it'll get similar results. It would technically get better results because they would not have failed at something. So I'm comfortable teaching this person this way because of all of the pre-steps that we've been doing. Despite their situation, they're doing coaching with me, they're working with me one-on-one, we're having phone calls. Holding them accountable. They signed up for credit repair, right? They're doing these things. They're talking to my team. They're taking action. That's how I, I know. Okay, great. But the person that just watches the videos and tries to do this on their own and then fails and then comments, you know, oh my God, this didn't work for me. Well, yeah, that, that can make sense if something didn't work for you because you did it by yourself. You tried to You try to put a car together, you tried to take a car apart and put it together, but you never went to school to be a mechanic, or you never went through any certification, any training programs to take apart a vehicle and put it back together. That's what we're doing here with our finances. Stop trying to be the expert in everything and hire, recruit experts on your team that are willing to serve you at the highest level. That's me. That's in this community. That's that's what you have. You're here. You're watching live or you're catching the recording. Let's work together. All right. So you got the links there. That's the action step. I wish you a wonderful rest of the evening. God bless you. I hope your weekend is a blessing. I hope a light bulb goes off for you this weekend, and I look forward to speaking with you one on one and my team as well. God bless you. Enjoy the rest of your evening and talk soon.

Bye now.