How I Optimized My Wealth Using Dividend-Paying Whole Life Insurance

Much like it's impossible for a policy to go backward, for the policy to lose value. You know, with the tree, Mother Nature is going to provide the tree with water and minerals and nutrients for it to grow. And as a policy owner, you're going to provide financial energy by paying your premium and repaying your policy loans and keeping your system continually growing and expanding. And all of the money that we borrowed in the form of policy loans and all the money that we repaid, we have re access to on demand, on our terms. Plus more.

We'Ve all heard growing up. I'm sure everyone in attendance can relate. You may have heard the comments around the family dinner table or maybe in the family room folks talking about, one day you're going to move out. One day you're going to start your own family. One day you'll have your own mortgage, you'll have your own bills. You'll understand. And I'm here to say to you that the wealthy don't talk that way. The wealthy talk about circling the wagons and keeping the money in the family. And so what we want to do is coach and empower our clients not only to truly become their own banker, but also to create their family banking system. And what I wanted to highlight was a really important teaching moment from Nelson Nash's book on page 15. And the book that we're talking about again is Becoming youg Own Banker. And Nelson goes on to say that when he's talking about the grocery store, he says, you know, this all reminds me of a phenomenon in physics. And he wanted the reader to envision taking a pail of water down to Seaside and heating it up to 210 degrees. And so if you think of, you've got this pot of water, you put it over an open flame and you heat it up to 210 degrees. All that you have at that point is really hot water. But once you heat it up to 212 degrees Fahrenheit, you have live steam with unbelievable power. And as we all know, the steam engine changed the world. But it doesn't happen until you get past 212 degrees. So there's a lot of heat that goes into the process up to the boiling point, but the dramatic power comes on suddenly. Now, what you're seeing here is you're seeing an image of a tree stump. And there's a reason why we use this image. Nelson described the uninterrupted growth by referring to a tree stump. And he would remark that every ring that you see in this image represents One year of uninterrupted growth. And we all know that a tree, it's impossible for a tree to contract, much like it's impossible for a policy to go backward, for the policy to lose value with the tree. Mother Nature is going to provide the tree with water and minerals and nutrients for it to grow. And as a policy owner, you're going to provide financial energy by paying your premium and repaying your policy loans and keeping your system continually growing and expanding. Now, this particular policy that I'm going to reference was created in 2012, and I am the life that is insured. And the annual premium deposit is 20,000 per year. Now, that's not the required premium deposit. That's the amount that I chose to put in the required premium deposit is less than 20,000. I have that flexibility, but I decided to deposit the entire 20,000. Now, it just so happened in that same year, my twin daughters, Caitlin and Charlotte came along, and we already have two children up to that point in our family, my firstborn son, Jackson, and my oldest daughter, Anna Grace. And so we were so happy with two more additions to our family. And I was very happy that I had even more death benefit coverage on my life and that God forbid, if anything had happened that my family would be okay and would have all the financial resources that they need to carry on in life. And then we began to utilize this policy as we began to take control of the banking function as it related to these things that we decided to purchase using the policy. The first was a family vacation. So in 2014, we took a family vacation. And I mean, my entire family, like we bring our extended family, everybody comes along and I access a policy loan to achieve that objective, and then the cash that I would have otherwise spent on that vacation, that and permanently transferred away from me and my family was redirected back into our aquarium of capital, our policy, and we could utilize that capital and reuse it over and over and over again. What's interesting is that every single day, the total cash value of the policy is increasing and still is to this day. Dividends have been declared and paid every single year since the inception of this policy. And every single year that a dividend was declared, that dividend was paid on every ring of growth. So as you can see here using this tree stump visual, every single year represents uninterrupted growth. And whenever a dividend is declared, it's declared and paid on every single ring. And so you're creating this compounding factor inside the policy that is absolutely outstanding and Then we purchased a vehicle. So we bought a Honda Odyssey using a policy loan. Ridiculously simple. Contacted the life insurance company, requested the policy loan. The policy loan proceeds showed up. There was no income verification. The loan is not reported to TransUnion, it's not reported to Equifax. It's a private loan. This is a private insurance company. My financial affairs are private. And then when we access the loan to. For the family vacation, for the first car, we already had a plan to repay it before we even accessed the loan. Because remember, don't steal the piece. We want to be a responsible business owner. And this is a business. It's our family banking business. And so we repaid the policy loans for the family vacation and for the car. Then we took another family vacation using the policy in 2018. Then we purchased another. Pardon me, another family vacation. In 2019, we purchased another vehicle. Going back, I know I'm skipping around here, but in 2017, we purchased my Ford Explorer using the policy. A few more family vacations. And then in 2021, I purchased a Nissan Altima using the policy. Now, if you can just envision for a moment all of the money that it took to purchase all of these vacations and cars. If I was to transfer all that money away from my family, how much lost opportunity cost is there? How much interest would I have permanently given up the opportunity to earn not only for the rest of my lifetime, but also for the rest of my children's lifetime and every generation that comes after that, We've changed, we've interrupted the pattern permanently. We've got that money flowing back to us now. And all of the money that we borrowed in the form of policy loans and all the money that we repaid, we have re access to on demand, on our terms, plus more. Because remember, every single day that I was driving these vehicles and every single day that we were creating memories in our family vacations, our total cash value in the policy was rising uninterrupted every single day. So the loan balances did not decrease any of our cash value. The loan balances did not negatively impact the dividends that were declared and paid on our policy. In fact, it had a positive impact. And all the money is coming back.

And so here's the power of not being afraid to capitalize your policy. So on day one, that policy had a starting death benefit of 721,000. Ten years later today, that death benefit has increased to 1.114 million, and it's rising every year. The total cash value on day one was 4,500. It's 220,948 and rising daily. The loan balance was zero on day one. It is zero 10 years later because we've repaid all of our policy loans. And now I promise you that having access to $198,000 today, opportunity is going to track me down. And I will be able to pounce on that opportunity by having ready access to money on demand and on my terms. Because who controls the repayment schedule of a policy loan? I do. And who has first access to the capital that could have otherwise been lent against my policy? I do. Who co owns the life insurance company? I do. And if the life insurance company lends money, who co owns the lender? I do. So I'm the depositor, I'm the borrower, I'm the banker, and I'm the bank owner. I shared with you. First thing this morning, we're going to show you how to become all four characters in the financial play. This is a sharp example of how to become all four characters in the financial play. If at any time that we were driving these vehicles, if we decided as a family that we wanted to not make a payment in any given month, well, we totally control that. The life insurance company's not calling us and saying, hey, what are your plans to repay this policy loan? They don't care. And the reason they don't care is twofold. One, the insurance company itself guarantees the collateral for the loan, the total cash value. And there's a lien on the death benefit for the loan balance. When I deposit my next 20,000 in premium, the annual increase in cash value will be 28,894. That's 44% more than I put in. So this policy passed 212 degrees Fahrenheit two years ago. And so this financial energy that's been created cannot go backward. Now, if you think about this like a traditional savings account, If I put 20,000 into a savings account and then a year later I still had my $20,000 plus $8894 more, what percentage of interest would the bank have to pay me to create that outcome? I've become my own banker. You can do this too, once you know how. In other words, I've created an additional $741 in additional monthly cash flow and I've done no work to produce it. So when Richard described earlier, if you knew at passive income time that you were going to get back out more than you put in, would you ever object to putting more in the answer is obvious. It's no. Your capital must reside somewhere. And so what better place to have it reside than inside of an entity that you own, that you control. Inside of an entity where you get to be all four characters in the financial play. The depositor, the borrower, the banker, and the bank owner. And this particular life insurance company has declared dividends every single year since inception of participating dividend paying whole life. They began issuing participating contracts in 1936, right in the midst of the Great Depression. And they've been creating a divisible profit every single year since inception. They began operating in 1920.

Outside of the 33 recessions that have happened in the last hundred years. The Great Depression, the Spanish flu, H1N1 Covid, the tech bubble bursting, several.

Periods of volatility in temperamental stock markets.

Policy values have been rising every day. Participating policy owners have been receiving dividends every single year without interruption. I'm paying no tax on the daily cash value accrual, zero tax. And when death occurs, my family is going to be replenished with everything that we've ever spent up to this point in our lives, plus more, because we've grown our system of policies throughout the years since starting this process back in 2008. But what I want to ask all of you is this. You're going to need the use of money for the rest of your lifetime. How much of that money do you want coming back to your family? And if you knew that you were going to replenish your family with everything that you spent while you're alive, would you want to spend more or spend less while you're alive?