Becoming Your Own Banker | Unleash the Power of the Infinite Banking Concept

I didn't really pay for the hot tub. I used the insurance company's money, using opm, other people's money, the insurance company's money that I am a co owner of, I borrowed money from them. Meanwhile, my capital is inside of the policy, growing every single day as though I never touched it.

Hello everyone. Thank you so much for joining us today. Today we have the absolute pleasure and privilege of having Richard Canfield here with us. And Richard is going to be talking about financing without the banks, how to unleash the power of the infinite banking concept. And I got to tell you, I've been in real estate for a while. I even was insurance licensed and I did life and home and auto insurance. I sold it for several years before I became a full time investor. And I did not realize that this tool was out there and available for us as investors. So I hope you guys are as excited as I am and, and we're going to dig a little bit deeper into that.

Thanks Elizabeth. I'm excited to be with you folks today. I'm going to go ahead and jump right in because you know, definitely we do have a lot of things to cover. So with the time that we have, you know, I want to try to set a bit of a foundation so you can't build a skyscraper without a proper foundation. Just like you wouldn't want to buy a house with a big fat crack, horizontal crack in the foundation. Unless you have experts on call that you get a smoking deal and you know how to solve that problem. Not everybody does. Those are often things that can scare a real estate investor away from a property. So you want to make sure we have a strong foundation. Once you have the right foundation, you can build an awful lot more stuff on top of that. And that's kind of the focus here. So we talk a little about real estate and ibc. IBC being the infinite banking concept. They're very similar. So a long term buying whole piece of real estate is almost, you know, I wouldn't say identical but the similarities, the characteristics of what we look for as real estate investors in a long term buy and hold piece of real estate, we are very similar with the tool that we use in the process of becoming your own banker and we're able to build equity, we can create a passive income over the long term, all those kind of similar things. We just have a little bit more control and we don't have to worry about the tenant horror stories. So there's no tenants, toilets, termites, etc. That we need to worry about when it comes to that sort of thing. We don't have to worry about the manipulation of, oh, I don't know, the federal government and the, the money printers manipulating the money supply when we deal with this type of a tool. So I'm going to talk a little bit about ibc. The Infinite bank concept changed my life. We're going to talk about the utilization of money access and control, the three keys of ibc. We're going to do a case study on a corporate owner. I picked a corporate owner because I think a lot of your coaching group, your mentorship group, has corporations or they're aspiring to get them. And so this will dovetail to that. But this works perfectly fine personally as well as corporately. And I'm going to get into a visual example. We're going to show the impact of making deposits into a system like this over time. And then I'm going to summarize with some passive income using this platform. I represent Ascendant Financial. We're licensed across most of Canada. We help people pretty much all over the country, even in the province of Quebec. We have a team there and we work primarily remotely through Zoom. We do also starting to get back into live events. We just did a live event in Toronto here earlier this month and we're planning a big event in October in Edmonton where head office is. And it's a ton of fun. We get to have a lot of fun helping Canadians and especially a lot of real estate investors actually all over the country. So how to connect with me, here's my partner, Jason and I, we have our platform, our podcast, Wealth Without Bay Street. So I would recommend for anybody a nice simple thing to remember is seven Steps Ca. That seven Steps ca. You can get a quick report there that explains how to, you know, the learning process. We recommend to dive deeper into this with our limited time. You're going to get an overview, but you know, you want to dig a little bit deeper. It's the kind of thing that we're always constantly learning. Just like you're always learning about how to make your real estate business better, you're always learning about this process of becoming your own banker. I'm a constant student, as I know Elizabeth is hurry. She has a natural curiosity. And I think that's one thing that makes her an incredible coach. And so I encourage people to develop a mindset of Curious George. You know, you got to get your hands dirty a little bit. You got to get out there and you got to write offers, you got to look at properties you got to do inspections so you can learn where the problems are so you know how to solve those problems. And with ibc, it's about that constant engagement and knowledge building. We have our, our podcast on YouTube, so wealthbaystreet.com forward/YouTube and in fact you can go to episode 114. That's where we had an amazing interview with Elizabeth, a lot of fun there. And we have our client series that you can access there. We have over 25 interviews with clients, many of which are real estate investors where they've got one or two properties or we've got some people who've got, you know, as many as 50 properties and some folks you might even know maybe in your local area. So some good resources for you. So, you know, here's a little image of me ripping down a wall in one of my properties and here I am building, doing some laminate floor on a flip project that I did many, many years ago. So as a real estate investor myself, you know, I've, I've experienced a lot of the fall, flat on your face, broken nose type moments. The tenant, midnight moves, you know, bringing a dumpster to a property to clean up after a tenant. I single handedly had to reclaim a lawn on the very first rental property. I was part of my first rental property when I was 13 with my parents and I had to reclaim a long lawn from a dog named Goliath. So if you're picturing a dog in your head, that's basically the dog we're talking about. And if you think about a dog trying to, you know, dig itself to China, that's basically what was happening in this yard. So, you know, I'm familiar with a lot of these kinds of problems. Moving appliances, doing reno is the whole, the whole works with real estate. We're looking to get appreciation, build equity, have access to money and capital and have passive income. These are the primary things people tell me when they say, why did you get into the real estate business? And so the same methods, the same things that we're looking for are very synonymous with the infinite banking concept. So here you can see my mentor, this is Nelson Nash. He wrote this amazing book, becoming your own banker. And Nelson was an absolute gem of a man. I loved him dearly. He, he's changed my life in more ways than I can describe. Not just with this concept. He's taught me about relationships, how to think, how to think differently. I had the pleasure of having him meet my son when he was about six months. This picture was taken in 2016, one of the last times I got to see Nelson do his 10 hour live seminar. And I was also part of helping build a documentary film for Nelson. This is Nelson Nash, the creator of the infinite banking concept. It's 60 minutes. You can go to nelsonnashfilm.com and you can watch that film. It's amazing. It's very inspiring. Whether you decide to do this or not, it's a very inspiring thing. So Nelson Nash film. We also have a tribute project to him called dayofnelson.com where we interviewed people who told some really great stories about Nelson and the lessons that they learned from him. I met him in 2012 and so it's just over 10 years since I met Nelson. He just changed me in so many ways. But it's 2009 when I got his book and at that time it had only sold maybe 250,000 copies. Now it's over 500,000 copies. It's a self published book, it's only 92 pages. And it's the gift that keeps on giving. So I want to shoot forward to 2019. Nelson passed away. And he would say he was 88 revolutions around the sun when he passed. And so through, over his lifetime he had 49 whole life insurance policies that he used to build up cash values and then use it to pay off his banks to reclaim the banking function in his life. And then he used it to accumulate and purchase assets throughout his lifespan. When Nelson passed away, here's something that's really interesting. There were 17, 17 tax free death benefit checks paid. That's incredible. There's 28 policies or assets, cash value assets that are still enforced today. Since Nelson passed away, he owned and controlled and started those and he was able to pass them in a tax free way down to the next generation as part of his legacy. In fact, many of those things he did while he was alive on planet earth. So he got to see and live some of his legacy that he had been building while he was still here. It is really, really phenomenal what you can accomplish when you can expand your imagination with the power of this concept. So I want to introduce you to my kids, Nathan and Nora. So in December 2016, my son Nathan, right here in the little hello shirt showed up and I got my very first policy on my son Nathan at that time and in fact just recently I just got two new policies on my kids where I own and control them. My wife and I own and control them. We're building equity and building a cash value reserve. I'll explain more on that in a moment. We're where we can access capital and use it for all the things that we're doing. Anyway, as an example, you know, I just bought a hot tub. My wife and I have been talking about a hot tub for 10 years, finally said, okay, we've, we've recently moved to Chilliwack. We've found a place that we're happy with here. We went and bought a hot tub. Well, I didn't really pay for the hot tub. I use the insurance company's money using opm, other people's money, the insurance company's money that I am a co owner of. Okay. I co own the lender. I borrowed money from them. I use my visa to buy the hot tub. I paid off that visa with the policy loan and now I'm going to slowly return that money back to the insurance company. Meanwhile, my capital is inside of the policy, growing every single day as though I never touched it. So it's a really powerful way of multitasking money. I can have money growing and working in one place, similar to a piece of real estate. You can build it, build equity and appreciation a piece of real estate, and you can access money off a home equity line of credit to go buy another property, but you don't sell the original piece of real estate. That same conceptual idea is all that we're doing. We're just using a different vehicle. And the vehicle has certain contractual aspects that make it very, very efficient to warehouse money. We all need to warehouse money someplace. I choose to warehouse my money inside of a company that I co own. I'm a participating owner with a company and they get to share their profits with me, including the profits they generate off of their lending business. So I co own the lender. It's really powerful. Now in September 2017, my daughter Nora, little Nora, joined us. And then you can see I've got a little paperclip back here. That's the application I sent in on my daughter's life for her first policy that I own and control. And when I'm gone, she will take over that policy as long as she's demonstrated the mindset that I need her to have to understand how to carry forward this legacy to the next generation. So mindset is really important. We focus on generational wealth. Now really quickly. I want to talk about May 2022. So I just got two new policies on my kids. Again, I own and control those. And in April we actually went on a family holiday to La Quinta, California. We had Our first family banking meeting. So one of the things we teach people in our, in our client membership group is how family banking works, how to host a family banking meeting, how to start having engaging conversations with your, with your children and associated family members. And so in our first family banking meeting, My kids are 4 and 6. We only took 30 minutes. We celebrated a bunch of wins on our vacation and got them really excited about what we had just accomplished. And then we talked about how we were able to fund that vacation from the family bank. And when we take money out of the family bank, we have to put the money back in because every time we put it back in, we can recycle and use that money again later. My kids already understand those foundational principles at a very young age. We keep it very simple. They don't need to know about insurance or any other stuff. They just understand that we operate from a family bank. We, we don't need to go or we try to limit our exposure to outside third party banks. And that's the process I want them to understand. So I want to talk quickly about how we buy stuff. Now. There's two primary ways that we, we buy things in life. The first way is that we, we basically finance things. So when we finance things, we go and borrow from someone else. There's a pile of money somewhere and we need to access from a pile of money. So we're going to borrow money, we're going to drop below the zero line and then we're going to work and work and work and work and work and all the way back to zero just to try to get back to zero. And along that line, you know, we're.

Making money is going out the door, often to someone else's bank. So someone else's bank is getting that cash flow of those payments coming back to them. Now, a lot of examples here. We can talk about renovations. You know, when we buy properties, we.

Could talk about cars.

We like to talk about cars because everyone needs a car. In fact, most people probably have at.

Least two cars parked in their driveway. And so we go and get a car and of course then we have to replace a car. It's either yours or the spouses or maybe it's a kid's.

Then we got to work and work.

And work all the way back to zero. And then we go borrow again, work and work and work all the way back to zero. And a lot of people just repeat this process throughout their life. All of this time frame, all those cash flow payments are walking out the door to Someone else's. We're changing the financial energy from where it could be stored with us and we're giving that financial energy to a third party person. Now our, another other way that people typically will go and buy things. Well, first is we save them up. So we have to make payments, we got to save up payments. We're making, saving, saving, saving. We build up a pile of money and then we drain that pile of money back to zero because we got to pay cash for things. So if we were buying cars and we want to pay cash for cars.

There'S nothing wrong with that.

However, in order to pay cash, well, first you have to have the cash. That cash has to come from somewhere. Your work, your effort. You got to work and work and work. Build it up, build it up. You have an amount of money. Then boom, you go pay cash for a car, you go pay cash for a renovation, you go pay cash for a replacement furnace. You know, you're saving your, your, some of your cash flow for your vacancy allotment, for your repair and maintenance fund for all these kinds of things. It's building up, it's building up and then, boom. Replace a roof, boom. Replace a hot water tank, boom. You know, vacancy. So these things happen in our real estate life, they happen in our general life in other areas. So as we build it up and we go back down to zero, well, then we got to build it up, build it up, build it up.

Work, work, work.

Get up to a point of money. Okay, we got a big chunk of money now. Oh, boom, something happens, it goes back down to zero. We got to buy another car. And people go through that process throughout their life.

The end result is we were always making a payment, we're making a savings payment. We just don't, don't think of that as the case. And we're actually making a financing decision here. You're financing with someone else's bank, so a third party bank down here and here you're, you're actually financing with yourself. The difference is that you're, you don't realize it's a financing decision because every time that you chop this thing down to zero, we're giving up the opportunity cost on your money to keep growing. We're constantly giving up the energy, the long term financial energy. And so when we implement a process like infinite banking, part of what we're going to do is we're going to stop interrupting the killing factor on that growth. We're going to make it so that when you build up that savings vehicle, it continues to grow and move forward throughout the rest of your natural life. And then if you kick the bucket either early or late, doesn't matter when a whole boatload of tax free money shows up to solve all kinds of problems.

And then if we do that on our kids as well and our grandkids, we're creating perpetual motion on money. So it's always working for you as long as possible.

So we are never interrupting the growth of that money. Now you're still going to go and need to buy like a car? Well of course we're not going to stop that. We're not going to change what you want to do. We're simply going to change the how you do it and where do you do it from. So now if I want to go buy that same car, well I go take a policy loan from the life.

Company which I co own, I co own the lender.

They must share their profits with me. And by the way, there's no questions asked.

It's an unstructured loan.

I choose the repayment schedule. I'm in total control. If I slowly pay that down by making the exact same payment I was going to pay someone else or I would have had to save to rebuild my capital, well I pay that loan.

Down, down, down and down.

And the end result is when I get out to this point, don't I have more equity than when I started? That's all we're doing. It's so very simple. It's just like having a house and you're using a home equity line of credit on a house. The difference is in the real estate market, real estate values can go up and they can also go down. Okay, and I'll give you a quick story. I have a property in Fort McMurray, Alberta. Maybe some of you are familiar with it. You know they got some oil out there. Now I've had that property for about 20 years. When I first bought it it was about $69,000. It's a one bedroom condo, about 700.

Square feet in a basement floor, four story walk up complex without an elevator. It was built in like 69. It's not the nicest building in town.

I can tell you that much.

The peak of the market, that Property appraised for 225,000. So on paper it looks like I did pretty good. Would you say?

I don't know.

What about you Elizabeth? Would you say I did pretty good on that?

Certainly sounds like it. Cause I'm guessing it was probably less than 10 or 15 years to get.

All that Equity, Yeah, it did pretty good, you know, and I never had to worry about payments on it or anything. Now, around that time, we did do an equity takeout. So we took out a good chunk of capital. And in fact, the end result is I got an equity takeout that was greater than the original purchase price of the property. So I got all my money back and then some. So that was pretty good. Still on the property, however, after that point in time, there was this thing called a global recession that happened. There was an oil price shift, and then Fort McMurray kind of went in the tank, and then there was a big fire, and then there was a big flood. And would you believe it that that thing just hasn't recovered so well? So if I wanted to sell that property today, I couldn't sell it for 30 grand if I tried, and then I'd still have to pay a real estate commission. So on that equity takeout, we did the actual financing that still remains on that property from that equity takeout is about 70,000. So I would have to stroke a check to the bank just to be able to get out from the property. And at negative cash flows, about $300 a month. Now, is that. Am I telling you that because I have a problem with real estate? That's not at all the case. What I'm saying is that timing does matter. Sometimes we get home runs and whims and we knock it out of the park. But ultimately, what we're trying to do is we're just trying to get on base. You want to get on base as many times as possible, right? It's like the movie Moneyball, if you guys have ever seen that.

So what?

In that particular circumstance, I'm still okay in that property because I haven't sold. So if it recovers, I might have a chance to exit. And it would take me roughly 11 years at the present negative cash flow to equate how much I'd have to stroke a check for to get out of the property. So it doesn't make sense to send good money today after the bad money. But the key thing is that I personally have experienced the real estate market ups and downs, and I could tell you some more stories about that we just don't have the time for. So what I want you to understand is that when we have this mechanism right here where you can control reclaiming the equity every time you put money back down on the home equity line of credit, you can access that money to use it again, can't you? Exact same process happens here. The difference is no bank is making the rules and the demands of you. You make all the rules and you have all of the control. That's the focus of what we're looking to create. Now, you're probably familiar with Robert Kiyosaki. I'm sure most of you are. I know for a fact, Elizabeth is. And one of my favorite quotes is, it's not how much money you make, but it's how much money you keep, how hard it works for you, and how many generations you keep it for. This is just pure gold. The infinite banking concept, when we utilize this tool, allows us to accomplish this exact thing. We then we can make sure the money's going to be there. It's locked in contractually. Every day that it grows, it's locked in. It can't go backwards. The only person that can make it go backwards is you. Not the market, not a presidential election, not Uncle Trudeau, and certainly not the insurance company. It's a contractual arrangement that you have with the insurance company.

Okay?

This is about a paradigm shift and the thought process and how we operate with money. So what is the infinite banking concept? I'm going to go to Nelson's book real quick. I'm going to read something from page three, but it's actually the first page of the. The book. This book is not about investments of any kind, okay? I'm not talking about investment structure here. It is about how one finances the things of life, which can include investments. It is not about rates of return. As time goes by, interest rates are up and interest rates are down. But the process, the process of banking goes on no matter what is happening. Very, very important statement further down, he says it is not a procedure to get rich quickly. To the contrary, it requires long range planning. Nelson says plan as if you're going to live forever and live as if you're going to die today. It appears to be a pretty good thought. One can learn how to plan and act intergenerationally. Think about that for a second. Intergenerationally. That's one of the advantages I've learned of being a foreigner. I learned to think beyond my lifespan of my current generation.

Okay?

There is no such thing as. There is no such thing as having too much money in the bank. Wealth must reside somewhere. So if you own and controlled your own banking system, how much money would you want to have in there? Probably as much as you can get in. So as we go through this presentation, I want you to think about family members and things that you love and care about and if you don't have kids, think about something you're passionate about. Maybe it's conservation, maybe it's cancer research, maybe it's something like that. What's something that you're passionate about that you want to help out? What's a legacy you want to leave in the world? So capital must come from a storage location. We always need capital. As real estate investors, our demand for capital is extremely high. We're always looking for a place to get the money. It's either coming from our resources or we're trying to tap into someone else's. A joint venture partner, a private lender, a third party bank. The need of capital is dramatic. And so when you're well capitalized, opportunities, opportunities of high caliber can show up for you. And I want you to think about that in your own life. Imagine when you had a boatload of money sitting in available did all of a sudden, was there a bunch of deal flow that started to come across your desk that you didn't see before? Because your brain starts to recognize and see those deals as they filter to you a lot better. So you finance everything you buy. You're going to either pay interest to access someone else's pile of money, or you're going to give up the interest that you could have earned on your own pile of money. There are no exceptions. So the whole idea is to recapture interest and money that you're paying to banks and finance companies for major items and to optimize efficiency of your own capital. Now I want to introduce you to my friend. He's the picture at the bottom here. This is Ryan Griggs, he's an Austrian economist, a friend of mine. He also has a great podcast and he says that infinite banking concept is simply put, the best way to systematically accumulate and optimally deploy capital over a lifetime. You need to accumulate and deploy capital, no questions asked. It is unavoidable. You just need to be able to do it from an efficient reservoir, an efficient location. So here's what the rest of the world's trying to teach us to do. They want you to accumulate money and take on all the risk you government programs, mutual funds, bank deposits, G. Give us your money. Give us your money. Give us your money. Let us handle it. Give us your money. Give us your money. Let us handle it. That's what they're trying to do. And then it's like a giant mousetrap. They're going to put these restrictions on you, trying to get access to your money the most closely. You know, line one is like an RSP and rsp, there's all these rules and hoops you got to jump through and penalties and you know, withholding tax, etc, IBC is about utilization, utilization of money. It's about safety and security of your capital. So you're in constant motion. Every dollar that goes into the program is always working for you. It can never go backwards. It's locked in and always in motion. Okay, you're going to finance all these things, you're going to be buying stuff no matter what. You got rental properties, obviously we're going to have investments. Maybe you like gold and silver or crypto, maybe you're trying to get rid of some of the third party debt. Whatever you got to do renovations, you.

Got to put money to work.

It's got to come from someplace. We want to stop the restriction here and we want to instead be able to create access, flow of money that you get to dictate the control of the flow of money. So here's the three keys of the infinite banking concept. Access and control. It's contractual access. There's no government restriction. It's a private contract between you and the insurance company. It's not a government sponsored plan. Okay. It gives you peace of mind. So nobody with whole life insurance policies had their bank accounts frozen earlier this year when there was, oh, I don't know, a few trucks on the road. Okay. Uninterrupted compounding on your money. So it eliminates the opportunity cost problem that we all experience. We all have to contend with it. We can't get away from it. Flexibility, you get control over your deposit. There's a degree of that. You have a really good control over deposits. I'm going to show you that in a moment. You can make some adjustments to the contract. You have access to loans, they're unstructured. Unstructured, meaning there's no repayment required. Yeah, there's a little bit of interest that you pay to the insurance company, but you co own the lender and you get the privilege of having your money continue working the whole time. So it's a really powerful way to decide how you want to put your capital to work and dictate the terms. So as an example, you go to a flip project, it's a six month turnaround time. You access money to fund your flip deal and you don't worry about making any repayments on that deal until your flip sells and closes. If it takes longer than you expected, it takes a whole year. So you accumulate a little of extra interest to life company but Meanwhile your capital kept growing the whole time. Total control versus going and working maybe with a hard money lender, which is totally okay, but you know, you're probably paying 15 to 18% on that with an interest only payment. And it's racking up, racking up and it's eating into your profits. So it's a way you can dictate the terms a lot more when you want it, no questions asked. It's one piece of paper. They can often direct deposit the money as long as it's under 50 grand or 50 grand in about, you know, roughly seven to 10 business days, give or take.

Okay, so I'm going to go through our case study here. We're going to look at a hundred thousand dollar program where we're putting $100,000 into a year, into a corporate example. This works personally and corporately. I'm going to tell you why I picked a hundred thousand dollar number. I don't want the number to scare you. That number could be ten grand, it could be five grand, it could be a million dollars. I'm just needed a baseline for us to work for and I wanted one that was easily divisible. Okay. And we're going to talk about one of the advantages for the corporation. Now in the background you'll see a picture of a house. This is one of my houses. I sold this house about a year and a half ago. Maybe it's only a year ago now, I can't remember exactly. This one actually did pretty good on. It was a suited house. I put the suite in myself. I lived in this property two different times. Has a big ginormous garage in the back that I also rented out separately for a while. It was a good property for me. It was in south Edmonton, Southeast Edmonton. Now the $100,000 example, the nice thing is you can add a zero if you want or you can drop a zero. So if we drop a zero, it's 10,000 bucks. So you can use your imagination and the numbers I use and say, okay, I'll just drop a zero, I'll drop the last number and I can kind of see what's happening there. All right, or you can cut it in half, we can look at another numbers that we're going to take a look at and we can kind of cut them in half in our brain to get a quick assessment. So that's the reason why I picked 100,000 because it's easy to divide in your brain very quickly to say okay, would that, how would this relate to me? All right, and just think for a moment. If you're purchasing a $250,000 house, well, you need 50 grand. $400,000 house, you need 80 grand. If you're buying anything in Ontario, you probably need an awful lot more than that. Okay, so, but just to give you some baseline, so put me on your payroll. The idea of this is very simple. $100,000 a year over 50 weeks is $2,000 a week. That works out to about $50 an hour for a 40 hour workweek. So imagine you had an employee for your business, your real estate business, or another business that you own, or, and you could pay them 50 bucks an hour, but they worked for you 24, 7. They don't get Covid, they don't take holidays, they don't take holiday pay. You don't have to give them a retirement account. You're not worried about them being poached by some other employer. They work for you non stop 24, seven for 50 bucks an hour. They're the hardest working employee that you have. Now imagine it was 10,000 bucks. Okay, no problem. Instead of 50 bucks an hour, it's 5 bucks an hour. So consider committing, paying yourself first 5 bucks an hour to hire this employee in your life and your business. Now, what's the most important thing on the balance sheet of a business? Well, when you think about your business, what's the most important thing on the balance sheet? Here's what I want you to think about. If you're the primary driver of the business, you're the main real estate investor and you're the one that's, maybe you have joint venture partners, you're just looking.

For your own purposes. If you all of a sudden aren't there to drive the business, manage everything, find the deals, look after the deals, manage the partnerships, all the things that you're doing. If you're gone tomorrow, who's looking after all that stuff? Often nobody. And a whole bunch of chaos is left in the winds. So we lose you. And nothing but a bunch of crazy chaos happens after that. And someone, often a spouse or a business partner or joint venture partner is left there holding the bag, trying to.

Pick up the pieces.

The most important thing on the balance sheet is you. You're the most important thing on the balance sheet. Nothing can replace you except the time value of money. And we solve for that problem actually using insurance. The good news is we can do that with insurance that you can use while you're alive, not when you're dead. You also get to use it when you're dead. You're just not around for part of that equation.

Okay?

Somebody is. It's just not you. Now. And I want you to just tell you quickly that I have clients of mine who are real estate investors and they even use having this insurance in place as a way to help attract joint venture partners because they're setting their joint venture partners at ease that they have insurance in place to protect their partnerships. So if something were to happen to one of the partners, it gives them extra peace of mind so they're more likely to be able to jump into those joint venture deals because there's extra protectionary mechanisms that are there to help support their partnership. So our $100,000 program, we've got a bunch of different ages here. It doesn't matter where you are on the timeline of life. I'm going to show you that I'm just using the 100,000 and I'm going to break it down between a couple of different age groups to show you that the impact is here isn't about, you know, the amount of death benefit or that it's expensive because it's not. You get back all of your money, it doesn't cost you anything. Just like a piece of real estate, you know, if I do an equity takeout on that piece of property, I told you in for McMurray, I got back more money, my down payment plus the original purchase price. So technically that property is free to me right now. I have to. It has to cost me probably another 70 or $80,000 before it actually, I actually start losing money on that property even though I couldn't sell it for that today, if that makes sense. Okay. So as far as I'm concerned, that property is free. So there's no one size fits all approach. We custom design this for everybody. Now I got a lot of numbers on the screen here and here's what I want you to take away. Basically I'm showing $100,000. This is my example. And we're going to zone in on the 45 year old. This is the one we're going to look at in a moment. But what I want you to recognize is that we have a breakdown here between the minimum required premium, or we refer to as the base premium or the foundation. It's the piece that's that foundation component that you can start building a proper structure on top of.

Okay.

We have a ton of flexibility here. And so in these age 30, 35, it's about the same 40, there's a little bit of a difference. 45, a slight difference.

50, a slight difference. And these are all rounded numbers, guys, to keep it very simple. The key thing is it's the same hundred thousand going in. The difference is how much time do you have? The 30 year old versus the 50 year old. Obviously the 30 year old is going to be better, but it won't be better over the same time frame. It's going to be better because the 30 year old's got more time on planet Earth, most likely. Okay? So they just have more years on the back end for it to work for them. In our example, I'm going to show putting deposits in for 20 years. Okay, in the example we're going to use, so we have a cumulative deposits of 2 million. And I'm going to walk through passive income on the end of that. Now again, if you want to picture this as 10,000 instead of 100,000, simply drop a zero off of these numbers, okay? Instead of it being 31,000, it's 3,000, 160, 900. You guys can picture that in your brain. All right, now the key thing I want you to understand here real quick is that the difference is in the death benefit. The 30 year old has a lot more starting death benefit than the 50 year old, you know, but the 50 year old's doing pretty good too. So the key here isn't the deposit, it's how much you just get less death benefit for the same amount of capital. All right, now imagine at age 40 here, okay, we did a 10,000 deposit instead of a 100,000 deposit. We wouldn't get 1.5 million of coverage. We get around 100,000 somewhere in 100 to, you know, 125, give or take. So as you start to make these bigger, you get a little bit of economy of scale. It's kind of like a bulk discount that you get at Costco. So you can buy in bulk a little bit as you raise these things up. Now the next thing I want you to see is that the difference between the 20 year period here from age 30 to age 50, our death benefit gap is about 655 grand. So over 20 years, we're 20 years older. We're putting the same hundred thousand in very flexible, but we have 600,000, you know, less death benefit than the 30 year old. I think that's pretty reasonable when you think about being 50 versus 30. Okay? One person is clearly 20 years closer to leaving planet Earth than the other one. All right, so I want to do a quick touch on the capital dividend account. And then I'm going to expand on this when we close out our example. So the capital dividend I refer to as the cash you deserve account. When the death benefits paid. The death benefit minus what's called the adjusted cost basis, typically produces it lands into the corporate account as a ledger entry in the capital dividend account. Every Canadian corporation has one of these. It's like a fictional side notional account. Certain things trigger it, so it creates a value. What it does is it allows a capital dividend to be paid to the shareholder tax free. So it's a way to extract money tax free out of a corporation in Canada. It's probably one of the greatest tax advantages in the Canadian tax code. Now it allows you to extract assets out from, from other resources. It's a very powerful tool. So in our example here, I'm going to assume that we've built up a whole bunch of other assets, real estate assets. Maybe you've got some Bitcoin or whatever, if you like crypto. Maybe you got a stock portfolio, you have a bunch of other assets. In my example, about 5 million. Here I'm going to show you after we close our example out, extracting all that capital out. So let's go ahead and take a look at our example. This little tool here is something we call the wealth access system. And I'm going to show putting deposits in here. So I'm going to start with our 100,000 example at age 45. And I'm just going to begin looking at funding it for seven years. And then I'm going to show the impact of funding it for a longer.

Time frame and how that shows up in your life.

So we're going to start right here with the first seven years. And what you guys will see is a bunch of colored bars. Okay, so the, this green one is our cash value. That's equity. Cash value is equity building in the policy. See how it's a steady line, continually growing every single day. In the background we have the legacy value. This is the death benefit. So you see that death benefit all the way to the end. Now I want to highlight at age 100, 4.49. And if I look at the orange bar, it's 4.49. So those two things are identical. If you're taking notes, I want you to write this down. By age 100. By age 100, the cash value, your asset, the cash value must equal the death benefit. Those two things must become the same. They're, they're linked in time. And so that is a Contractual obligation of the life company to make sure that happens. Okay? They have no choice in the matters. Just like you got a mortgage contract, you got to pay the mortgage off before you can sell the house or it has to get, get paid off at closing to pass clear title. It's a contract between you and the mortgage lender. The same idea here with the insurance company. We have a contract by age 100. It must equal the cash value, must equal. So it's in constant growth mode. Now. Here's what I want you to see. We started at 45, I'm going to go to age 50. We've put five years of $100,000 in. We have a cash value asset of 500, 3,000. In other words, we have an asset value that's greater than every dollar we've contributed. So pretty good. That's kind of like buying a long term buy and hold real estate. You put your down payment in, you, plus you have some extra, you know, things that build up. By the time you get about five or six or seven years out, you have access to all the original down payment capital that you put into that, that deal. You know, unless we're talking about the last four years in Ontario where the real estate market's been going like, you know, kind of crazy, which is may, some would say maybe a little unsustainable, I don't know, that's debatable to, to a point. But here's what I want to do. I want to just kind of show you that we're getting this thing very efficient in a short period of time. The key thing is if I look at that cash value, you see how that cash value still growing, growing, growing. I can access 90% of that 9,090% on any given day while it's accumulating, no questions asked.

When I access that capital by way of a policy loan or a collateral loan, my money continues growing. So if I borrowed, let's just say I borrowed 400 grand right here in this year, that 503 continues growing while I have that outstanding loan going and buying me a couple of rental properties. So I got rental properties growing, plus I have this growing. I'm multitasking my asset base, okay? Multitasking the asset base. Now what I'm going to do, I'm going to go all the way out here and Elizabeth, I'll let you pick here, pick a year on the back.

End that you want me to look.

Somewhere between 85 and 100. You decide which one you want me to do.

Let's go 90.

90. Okay.

Elizabeth makes a call. We're at 90. Okay. So we're funding for seven years. That means we only made deposits here for the first seven years. So we only did 700,000 of money going in. That was our outlay of our capital contributions into the program. And then we completely stopped at that point. Now, I wouldn't recommend that, but I'm just going to show you just doing that. And then what happens when we put more capital in? So we have a cash value asset here of 3.16 for the 700,000 we put in. Are we doing okay with that number? And no one would be upset with me if you put 700 grand into a property and then you had 3.1 million of equity, you know, 40 years later, like, no one would yell at Richard for helping them do that, I hope.

All right.

Especially if there was no market risk and you didn't care about the presidential election or what, you know, the manipulation of the. The money markets now. So it's 3.1 if we're alive, and it's 3.6 if we're dead. Okay, now here's the cool thing. I'm going to add three more deposits. If it was doing this good, wouldn't you want to put some more capital in there? So what were to happen if we just funded three additional years and we took this up to eight to the 10th year? So watch. Watch this cash value number right here.

Okay, so we went from 3.1 to 4.6. Let me just bring that back down again. 3.1 to 4.6. So what did we do? What changed? We voluntarily. Voluntarily, because no one can make you do this. Decided to put three additional deposits of 100 grand into the system on the front end, and that created an extra $1.5 million of capital while we were alive.

Okay.

To use with throughout our lifespan. That's the power of having this uninterrupted compounding effect without having the markets, you know, dictating it going up and down. You know, same thing. If we obviously made more deposits, you can see those numbers increase as we go. The key thing I want you to see if I'll bring this back down to 10. If you look at age 100, look at how much the cash and the death benefit, of course, have increased, but the total cash value and the death benefit are still matching. They're still the same. That's the key takeaway that we want to have here. Okay, Now I'm going to quickly flip to the next tab here. Now Taking a bit of an income off of this thing.

And then I'm going to summarize this.

With, with the numbers on the slides. So here's our 100,000 for seven years. I'm going to show starting a tax free income. There's a way that you can take income off of this tax free. So I'm going to start drawing an extra income at age 70. We have to leave some money behind for the next generation. We can only use, you know, 90% of that equity. We got to leave some of that money available for that eventual death benefit. So we're going to leave some behind. So from age 70 to age 100 for 30 years, we're going to take an annual tax free income of 57 grand a year, which is cumulative about 1.7 million. So we put in 700 grand. We took out 1.7 while we were alive, and we also left 500 grand behind for the next generation. In other words, for our 700,000, we got, we've got to utilize 2.2. So for every dollar we put in, we got $3 back out. Now if we bring this up to the 10 year increment and we funded it for 10 years, well, not only do we get to leave a larger number behind, but we also get to take a larger income over that time frame. Okay? So for every dollar that we put in, we got to work with or utilize. We had the power of utilization of $3.26. So that's the power of putting this kind of system to work in your life. So now with that in mind, I'm going to flip back to our slides. And so here we've got an example again of our corporate retirement plan. Again, this works both personally and with corporations. I'm just focusing on the corporation today because there's a couple of unique differences. So here's a summary of the example I just showed where we did $100,000 and I'm actually putting it in for 20 years. If you go back to my chart that I had, so age 4,500 thousand, we have a minimum premium and a flexible premium. We committed to doing that for 20 years. We built up a large asset base. I'm going to show taking an income for 26 years from age 70 to age 95, including 95. That's what makes it 26 years. The corporation is going to take a collateral loan, basically like a, like a, it's kind of like an operating line of credit, but without a requirement for repaying it. The interest is just going to Capitalize with no repayments. The corporation takes a tax free loan of 154 grand a year. The shareholder is going to pay a taxable dividend to themselves outside of the corporation. They're going to get $100,000 net of tax. That's assuming a 48% marginal tax rate. So the corporation funded it. Corporation took the loan, issues a dividend. We're working with 100k after taxes paid. So 100,000 is what the shareholder gets. So 100,000 over 26 years is 2.6 million of after tax income. So the corporation paid 100 grand a year for 20 years, that's 2 million. We took out 100 grand after tax for 26 years, that's 2.6 million. So the corporation funded it, the shareholder got to spend it. Corporation funded it, shareholder got to spend it. Very important. So our shareholders get 100 grand a year. You decide when you take it, you have passive income in control. And you know, now eventually of course we're going to have a death benefit occur. So the shareholder dies.

I'm assuming they die at age 95.

In this case, a tax free death benefit pays the loan, including all interest. So at that stage of the game, this has about a $10 million death benefit. We have an outstanding bank loan because we've been borrowing money and interest has been adding up and accumulating. We haven't been sending a single dime back to it because we have the control to do that. Okay, so the corporation's got this big giant $8.3 million loan on it. 10, 10.2 minus the 8.3. We have obviously a net differential. The corporation receives 1.9 tax free of net death benefit. So that's how much we can extract out of the corporation. So again, the shareholder took out 100 grand a year after tax for 26 years. And then $1.9 million shows up tax free after they died. Here's the key thing. The capital dividend account gets $10.2 million of a ledger entry. It's like a fictional notional account, which means we now the remaining shareholders can extract up to $10 million of money out of that corporation as long as that corporation is alive of additional assets. So now all your rental real estate, your other assets you've accumulated in that holding company, you can now start extracting those things out tax free for the remaining shareholders. So in the example I gave before, we have all these other assets here I Showcase, we had $5 million of stuff. We've got a CDA account of 10 million we can extract that stuff tax free to the next generation. Now, what if we lived longer or.

We wanted to start taking an income earlier? Well, you can take an income for longer. You just get a slightly lower amount. You just do it for a longer period. You want to go to 65 to 100.

Cool.

You take a lower amount, you just do it for a longer period. Or you want to go 70 to 100.

Okay.

So again, you get to control and decide how this works. You're not restricted to a bunch of government rules to change everything. So real quick summary. Again, get that seven step report at seven steps Ca. It walks through everything about how to, you know, learn more about this process. We go through a lot of case study work and stuff there. I would definitely recommend subscribing to our podcast and getting a copy of this book. Becoming youg Own Banker. We ship it all over the country. I recommend the physical book, not the digital one. The digital one is okay. Does a start. There's also an audio version, but I prefer the real copy. You want to take notes in this book. It's really a powerful book. So with that in mind, I think I'm hitting the time limit, Elizabeth, so I'll bring it back up and we can fire up some questions and see where we go from there.

Wonderful. Thank you so much. That was fantastic. There's a lot of complexities. The reality is it's a tremendous opportunity for people to do exactly like you said at the beginning, where if this is something that you're interested in, then you definitely want to dive deeper. And that's why you provided some additional information which was absolutely fantastic. Without advertising a specific insurance corporation, do you have any insurance corporations, any specific insurance policies? Without advertising a specific financial institution, do you have any financial institutions that would lend against a life policy? So there's like three questions there all put together.

So the answer is yes, there's specific lenders that lend against them as third party collateral. In fact, it's a growing industry and a growing business. Working with your regular bank. They don't have people that work in a department that understand how to do that. Most of the major banks do do it. However, they usually have limitations on what size of plan they will lend against. And often a lot of people don't meet their criteria. There's some other ones that are much more flexible. However, 90% of the time, we're doing most of our business with the life company directly because you have contractual access and there's no requirement for jumping through any other third party financing Hoops at some future point. There's. There's a variety of reasons we have our episode 100 of our podcast explains this. It's a. It talks about certain taxable events that happen at a later date and how we mitigate that tax problem by working with a third party lender at that time. So the answer is yes, there's. There's third party lenders. There is a list of them. It's a growing business. They're actively looking for that business. But we do a lot of our business primarily with the Life company itself that you co own. And there's a reason for that because you got to learn how to walk before you learn how to run. And so there's habits and mindsets that we must be good at implementing by getting practice. Just like you need to learn how to write an offer, you needed to learn how to walk through a home inspection. You need to learn how to look at a deal sheet and analyze that deal for your needs. These are things that you do over time. They don't just happen overnight. So this is a constant learning journey. I myself am always learning. We're always trying to strive for improvement and betterment of ourselves and our ability to think and are using our imagination.

Love it.

And that's absolutely true. That's part of being a sponge and being a good student for, you know, for our entire lifespan. Is there interest when you need to take out the money as a policy loan?

There is, yes. The life insurance company will charge interest and it's very similar like a line of credit. But you don't have to make an interest only payment. You should be making a payment. We teach you how to structure that. We want to be doing that. However, you're never in a position where you must do it. I'll give you an example. I just funded a new policy on my wife in a corporation Holdco that I have. That particular premium is about is a conversion is about $35,000 a year. The minimum premium on that policy is about $9,500, roughly speaking. So the rest of that is all flexible. So my minimum requirement was about 9,500 bucks. I immediately borrowed within about 10 days about $22,000 or $23,000 off of that contract with no questions asked from the Life company. And I'm using that to pay my corporate tax bill. So I had to pay corporate tax for it anyway. But rather than giving my money directly to cra, I first put my money into the policy. So I have constant motion on all the money that I was going to give CRA anyhow and now I have an outstanding loan. So as I make my regular tax contribution, instead of making a tax contribution to cra, yeah, I'm going to pay a little bit extra interest to those guys. I don't really care. I'm making a loan repayment to my policy system so that next year when I go to pay that tax bill, I can recycle the money. Essentially I control that and I'm getting more run rate on the same money I was going to give the Canadian government. Anyhow. I'm really passionate about this and Nelson's book is really important. And really, you know, we don't really.

Work with people that don't own a.

Copy of the book because it's like, it's basically the bible for this, this concept. It's a, it's the work material. We're always going back to it. It has all the foundational knowledge that we need to be successful. If one day I'm not here, I mean, we have a whole team of people in place. But if you have the book, you always have a guide to navigate you through this process. And to me, it is literally the book that keeps on giving. Like, I've got, I've got highlights that you wouldn't believe going through this, this book. And I take, I take notes. I'm now writing down dates of time frames that there's certain things that I learned in the book. You know, I've got, you know, notes of what's, you know, one of my colleagues mentioned something that just sits with you. You can read any given page on a day and you can sit and chew on that page for the day. There was one question I saw about death benefits being taxed. Death benefits are not taxable in Canada. As long as they're done, you know, correctly 99% of the time. There's a very rare circumstance where that can occur. But a property design policy, there's no tax on a death benefit. Just to put that note in there, we actually just released a podcast episode on shareholder borrowing, which is a bad idea where that can happen. Some people promote that and that could create a problem with the taxable death benefit. But it's also very rare. And we explained why. It's a corporate landmine. So we have lots of great episodes like that.

And that's one of the benefits of being one of your clients, right, Is you explain how to do things properly. Because you guys know the tax act and all these other things. You know how to navigate through all of that probably better than some accountants even.

Yeah. And we have, we have an accountant, CPA professional on our team who teaches this as well. So I'm doing a lot of content with him around that right now. His name's Henry. He's out in Toronto. And we, we also have great relationships with people that we work with all the time. We do quarterly client coaching sessions with our clients. So we do about a three, four hour zoom every quarter. We go into different kind of topics or we revisit specific topics. Yeah, I mean, we're 100% education all the time. So we just want to do everything we can to help others by giving as much value and information to them as possible. And I firmly believe that Nelson's book is a game changer. It's changed my entire life. There's not a single aspect of my life that isn't positively impacted by it. Not one.