A chiropractor with $420,000 in debt across 15 accounts used whole-life insurance policy loans and a checking account strategy to eliminate everything in 57 months instead of 21 years. He paid $108,000 in premiums, borrowed $86,480 against his policy, and freed up $7,640 monthly once debts were gone.
Questions this video answers
47‑year‑old male chiropractor.
$420,000 of consumer debt across 15 debts (including two mortgages).
$20,000 per year (target capitalization amount).
He used a private loan (borrowed $30,000) to capitalize the policy initially.
Approximately $11,200 immediate access as policy loan in year 1.
Chapters
Is it's all about who is getting the money and who's that money being put to work for. When he pays back, as he pays back this 17,141 of interest, he is the one who actually gets to go and access that money again and use it again. All he changed was the process. See, we're not changing anything dramatically in our lives. We're already doing most of what we need to do to be our own banker. We just need to change the process.
The most important thing is we need to be clear about the objective and how the client's structured and all that sort of stuff. So this objective is to eliminate $420,000 worth of debt in less than 21 years, which was the current amortization. So we have a client who's 47 year old male chiropractor, $420,000 of consumer debt, including two mortgages, 15 total debts. So he was in a lot of trouble. He had a deep amount of debt here, a lot of payments flowing away.
His banking system started with a capitalization amount of $20,000 per year in year one. So this is how we determined, well, we worked with the client to determine how much capital do you want to deposit in your system? What's this going to look like? So the way that he was thinking about it is he thought, okay, I have patient visits that are worth $50 on average, and he has one to two patients that will end up no showing, and he has one to two patients that walk in off the street. And we said, hey, look, if you set aside two patients per day, $100 per day, would that break your business? And fortunately, the answer was no. So he works about 200 days per year. You multiply $100 a day by 200 days and that's where we got the $20,000 per year. And what he's doing is he's actually setting that amount aside moving forward so that he can capitalize the policy each year. Right. So he's just setting that money aside because when he first started the process, he actually didn't have the $20,000 to capitalize the policy. So he actually capitalized the policy using a private or funded by a private loan, which is also included in the $420,000 that we're going to recapture using the system. And I'm going to walk you through that entire example as we go here. So again, we want to be clear, we want to review the objectives. So the objective was to get debt free, but not just become debt free, but, but without working any harder, without taking any additional risk, without changing his current cash flow, without losing control over his money, and without ever leaving his family in a pile of debt if the unthinkable were to happen. So let's go ahead and take a look at the solution that we're going to present. The debt recapture solution, using the process of becoming your own banker, the infinite banking concept. So anytime you get inspired to make a difference, you have an idea. We're going to go and create a plan around it, and then we're going to put that plan into action. Let's remember that, you know, there is 15 different debts here. There's a lot of moving parts. So it's just such a large spreadsheet that I gotta, I gotta move around like this. So we'll make sure that you're really clear as we follow the flow. Okay, so let's take a look and summarize what's happening first. So you can see in this line here, this represents the months that are going by as we're implementing the system. This amount here, $20,000 per year, that represents the amount of premium that the client decided to put into the policy. And then this you can see here, it says policy loan number one. You can see that as soon as he deposited the $20,000 into the policy, what he was able to access as a policy loan without interrupting, the daily cash accumulation in the policy was $11,200 right away. So now you can see that we've also got a separate checking account set up, which I'm going to review. Why we had that account set up in a moment, but I just wanted to draw your attention to that. And then what we have here is you can see all of the different debts. Debt number one, the company that he owns, the debt to the current payment, and then, oh, no, sorry, that's the current balance. And then this is the payment that he's making. There's the interest rate, and then the amount of time that it's going to take to pay that specific debt off as we go. So you can see each of the debts have their own layout. And I'm going to walk you through exactly what we were able to achieve here. So first things first, as I said before, we were able to access 11,200 from the policy loan immediately. And he was able to use that money to eliminate the smaller balance here, the smaller balance from the Target, and then also the BMO MasterCard. And then we also made a little bit of a dent in the CIBC Visa. So you can see that here is the balance after applying the rest of the funds to the cibc. Now you see that he's making these payments here. It shows the payment that's actually being made to each card or each debt and what the original payment was for the MasterCard. And you can see that the payment come down a little bit here. So we want to practice the concept and be responsible bankers. So remember, we're not changing his cash flow. So what he's doing is after he makes these payments or after he pays off those debts, he's not just taking that money and oh, great, let's go and spend that money. Don't steal the piece. He's going to take that capital, he's going to redirect it. But in this case, we're not actually paying back the policy loans yet. He's not paying back the policy loan. What he's doing is he's taking these payments and he's redirecting it. Because his main objective, his main priority was to eliminate this debt as absolutely quickly as possible. So we're using the system to enhance what he's able to do. But what he's doing is taking those payments and he's putting them in this separate checking account here, setting the money aside so that we don't want to commingle this money with his other cash that he's using for life or policy loan funds or anything like that. We want to keep it separate so that he can track it. Of course, he could be using this money and piling it on other debts, but just practicing the concept what he wants to do, instead of sending all that money right away, away from him, he's collecting and accumulating it into a separate checking account so that he actually still has of that money. So imagine he takes this capital, he eliminates all those payments, and then he continues to make the payments that he normally was. And then he's putting this money aside into this separate checking account. And then you'll see during the first year at about month eight, the payment that he's putting back in that separate checking account is does a. Has a large jump. Well, why did that happen? That's because if we go over to his policy or his debt, excuse me, debt five, you can see that the balance here from his chiropractic practice, he had about a 7,000, $7,400 loan outstanding. And just by virtue of continuing to make the payments that he was already scheduled to make on that loan by about the month eight, in the middle of the first Year of the process, he was able to eliminate that payment. And again, rather than going out and getting himself into more trouble or financing something new or just spending the money, he added it directly to his separate checking account because he's already used to making that payment. So now if we fast forward.
Along in the example we're going to look at year, you'll see month 13 or year 2. Remember, we're going to not be afraid to capitalize. So he was setting that money aside, $100 per day for those patient visits. And then that was where he got the second year capital to be able to capitalize the policy even further. And you can see in year one, he was able to access that 11,200 dol 200 right away. But the daily cash value is increasing every single day. And then when you deposit the policy value or policy premium in year two, that's going to enhance everything. The policy is going to become more efficient. So he deposits his $20,000 and he's able to access another 17,500 in year two. Plus he's accessing the 13,255 that is accumulated in a separate checking account. So that gives him access to just shy of 31,000 total. And what is he going to do with that 31,000? He's now going to go and he's going to eliminate the rest of debt number four, the Visa. So we have a balance of zero. So he's freeing up the cash flow. Here he goes and eliminates debt number six, the TD bank.
And then that is this balance here. And then we wiped out debt number.
Seven as well right here. So we're again with these payments, we're freeing up the payments on each of these debts. And then we were also able to get debt number eight. And then we're obviously doing damage on, on this debt as well because keep in mind he's continuing to make his loan repayments. And what I failed to do earlier gang, is let me just scroll down here and you can see all of the rest of the debts on page two. So you can see right here is the private loan that he used to capitalize his policy. And you can see he actually borrowed $30,000, not $20,000. He just borrowed a little bit extra to eliminate some additional debts that he had right away. So that's how he capitalized the policy. So let me scroll back up here now again, going along with what we've said earlier, he's going to be responsible about the process. Very disciplined, but also very committed to what it was that he wanted to achieve. So you can see that those payments that he was making to his separate checking account is now gone up to $33,625 per month. And so at the end of the year, he actually accumulated and piled up $43,500. So this is where I'm going to slide to page two.
I believe this is just showing the balance of this debt here.
So we're going to slide down.
Okay, so now you can see we're at the beginning of year three. So he capitalized the policy again. Again, remember, always setting aside that additional capital from those patient visits, not changing his cash flow. And then he was able to pile up 43,500 from the separate side checking account. And then Here we have 61,735 that he has available so that he is going to go and eliminate a bunch more of these debts. So you can see that the additional cash that he's putting in that checking account is rising. Putting it aside. And we eliminated 11, 12, 13. And we're able to do a little bit of damage on house number two. Remember, he has two mortgages. Here's house number one. Look at all this capital that was flowing away from his family. And just keep in mind, we know that we're practicing the debt recapture example here, and he's really committed to it. He's putting this money aside. But part of the reason why he's putting this money aside in a separate checking account, because again, at any point, let's, imagine, you know, life were to occur, he's actually got access to this capital in a checking account. And all it would do if he accessed that money, it would just delay the process that he's implementing right now. And he could get right back on the wagon whenever he was back on track if something did occur in life. And so now you can see that the momentum in the policy, Keep in mind, he's not repaying any of the policy loans at this point. Now in year four, he deposits his $20,000 and he's immediately able to access another $19,000 out of the policy via policy loan, plus the $69,310 that he's setting aside. So he has access to 88,310. And what is he going to do with that? Well, he's going to take that 88,310 and he's going to apply it to house number two. And so that's where we get this balance right here of the $6,980. And did that affect the payment? No, it didn't affect the payment. So now a short while thereafter because he's still continuing to make that payment and he's piling money up in the side account, he's going to be able to eliminate that next debt quite quickly.
In fact, if we scroll down here, we'll just see at the end of year four, beginning of year five, here we are again. You'll notice something interesting here. This is completely up to the client. It's their choice what they choose to do. But now that his system is become very efficient and it's what we, I like to refer to it as live steam. This has got this pot of water that's just boiling and it's got a lot of power now. It's got a lot of energy. Every policy that we design is going to have a base or a minimum required premium and it's going to have a maximum premium. So in this example, the maximum premium for this policy can't put a single penny more in than $20,000 per year. But he's not required to put the full 20. It's completely up to him. He's only required to put in $8,000 base premium. So he could put in 10,000 if he wanted. 15. But in this case, what he chose to do, because this policy is now efficient, he deposits 8,000 the base premium, but he's immediately able to access $9,300 more than what he had originally set aside. So what he decided to do because we want to become more profitable over time, and as we said, money grows on branches, we want to grow and expand the policy system. As we're able to sustain the policy system, we want to make sure that we don't bite off more than we can chew. So what he decided to do at this point is he decided to start.
Policy number two. So he decided to start policy number two at $20,000. And so he's able to access $9,300, $9,315. He deposits policy premium for policy number two. And just similar to when he originally started, he was immediately able to access 11,000, almost 200 plus the 71,305 that he had already set aside. So now he's going to take 91,000, 8, 10 and he's going to completely wipe out oops, he's going to completely wipe out a debt number 14 and he's going to do some serious damage on debt number 15. And you'll see, here's the balance and then the payment was dramatically reduced, because what he did is a refinance at that time to free up even more cash flow to put back into his own policy system. And so now you can see here.
At month 57, because again, being very diligent, very disciplined, he was able to access enough capital from his separate checking account to be able to eliminate altogether the personal mortgage and free up even more cash. So he got rid of debt, excuse me, debt number 15, house number one. And now again.
What'S the responsible thing to do? Well, keep the money flowing back in the system. Keep following what you're doing. And what he's been doing now is he's still accumulating that cash. At the end of the year, he piled up another $35,200. And now he can start redirecting that money to pay off the policy loans. And you can see he continues to capitalize. And because he put that money aside, he has access to another $62,000. And that is the debt recapture spreadsheet. This is the plan. Now, keep in mind, there is a huge amount of planning that goes into this process. It takes time to find out exactly how the client is structured. It takes time to look at what their objectives are and then actually put this together in a way that it can actually be implemented in a simple systematic way. There's a lot of moving parts. That's the result that we're able to create. Okay, so a debt recapture recap. All debts were gone in 57 months versus 252 months, 21 years. So all those payments are freed up and relieving a lot of stress. And coming back to the house now, the total premium dollars put into the policy or policies, because we did start policy number two was 108,000. That's what he deposited. And the total policy loans was $86,480. That's what he borrowed from the policies via policy loan. And the total debt that was recaptured was $420,000. And now continue to summarize now, the interest capitalized by the life company, because, remember, at no point was he repaying policy loans during the debt recapture process. That's what he chose to do. So the interest would accumulate on the policy loans of a total of $17,141. And at the time, it was 7.5% interest. And now, as we mentioned earlier, 6.2% is the interest rate, simple interest rate at the life insurance company. Now, the key thing I want to point out with the 17,141 is it's all about who is getting the money and who's that money being put to work for when he pays back, as he pays back the 17,141 of interest, he is the one who actually gets to go and access that money again and use it again. And he's storing it in a company that he co owns so they can put that money to work and create more profit. We're actually contributing to the profitability of the insurance company by flowing our capital into the policy system, into the company. So the chiropractor is now pumping the money into the system in the right direction. The total loan outstanding, the policy loans outstanding, 86,480 plus the 17 $1,141 that accumulated in interest, $103,621 of policy loan balance. And now what is he doing? He's going to be a responsible banker. Don't steal the P's, don't change your cash flow. He is now redirecting the $7,640 per month.
Beginning in month 57. Right. Because that's the plan that he put in place to use as policy loan repayment. So now he's redirecting that money right back to his system. And at any time, if an opportunity tracked him down or a problem show, he could go back and re access whatever he's paid back plus that daily growth. So giving him access to an ever increasing pool of financial value so that he can achieve more objectives for his family. And so at the amount of loan outstanding, policy loan and the payment that he was sending back, he's able to crush that policy loan balance as well in another 13 and a half months. So the entire process, not only did he crush the 57, excuse me, the $420,000 of third party debt in 57 months, he was able to actually complete the entire process and replenish his pool in his policy system again without interrupting that growth. More and more momentum being created over that next 13 and a half months, not to mention the capitalization that he would have done at that time. He was able to complete the whole process and replenish the policy loan and recapture all that debt within 70 months. Policy Loan fully repaid access to all the family equity. Imagine that. So he has those properties that he still had. He probably, you know, he has those other cards and those lines of credit and whatnot. We don't want to use that. He has the equity now. He has that capital built up in his policy system so that if opportunities show up or God forbid, a problem or he needs to finance a vehicle or what have you. He has access to all that equity in his policy system, not to mention he actually has two mortgage free homes that he could, if he chose to register a line of credit against those properties to potentially access even more assets to create more cash flow for his family, create more freedom and expand his banking system even further. Let's go ahead and recap. Did the chiropractor accomplish his objective of paying off the family, the paying off the family debt? Yes. Did the chiropractor work any harder? No, he just kept doing what he was already doing. All he did was change how he was doing things. Did the chiropractor ever lose control over his money? Absolutely not. Especially because he put that side account together and yes, we were storing that in someone else's bank, but it was at least being stored there rather than being trapped inside those debt instruments. And then did the chiropractor take any additional risk? No, he did not. Did the chiropractor ever change his cash flow? He didn't. What did the chiropractor change? All he changed was the process. See, we're not changing anything dramatically in our lives. We're already doing most of what we need to do to be our own banker. We just need to change the process.
