Life Altering Benefits of Paid Up Additions in Your Insurance

Paid up addition is essentially more death benefit that is built on top of your starting debt benefit. So as the book says when it talks about paid up addition is an add on to your base policy. Your base policy is your starting death benefit that you get. And on what the paid up addition does, it adds on to that death benefit. So again, going back to that analogy, so your foundation, the base policy with the starting death benefit and then the floors become the paid up addition that adds on a floor of death benefit on top of each other over time. Are you tired of life insurance policies that offer limited benefits and rigid structures? Well, wouldn't we told you that there's a better way to secure a financial future and grow your wealth at the same time? Paid up additions for whole life insurance policies are the secret weapon that many financial experts swear by. And in this video we're going to dive deeper into why. Get ready to find out how paid up additions can transform your life insurance policy into a super powerful tool that will help build your nest egg for years to come. So buckle up, let's dive in.

All right, thanks, Trent. So first off, what I wanted to encourage everybody is get a copy of this book if you haven't got it. We're going to be talking a lot today about how cash follows the leader. That's right, Cash follows the leader. And it's a great book. You can get it on Amazon, you can get it through our ascended financial website. It's just a great book to have. It's one hour ready and yeah, just a great tool for you. So we're going to talk about paid up additions. And to start with, I'm going to read a section out of this book and it's page 32 and it's called adding floors to your financial house with paid up additions. Start off with they say just as the foundation supports your home and bears the weight, the same applies to your base policy rent. If you don't have a good foundation on your house, what's going to happen to your house over time?

Oh, it's going to collapse. Especially if it's built on sand, which is horrible foundation.

Yeah. So exactly. You want to have a good foundation on whatever you're using in life, whether it be your home or whether it be your financial instrument that you're using to build wealth. So that's foundation and life insurance is the base policy. Now in this segment we're going to talk about adding floors to your financial house that will stack up on top of the foundation. So think about that. We're going to stack these floors on top of the foundation. And as you build a higher and higher house, well, you want a good foundation, but we're going to talk about what are those additional floors. That's where we come up with the term that referred to as paid up additions. And quite often you'll hear people refer to that as PUAs. So what are they and how do they work? Paid up additions is an add to your base policy stacked up on one another just like the floors in your home. And there's two ways to buy them. So let's just go back to what are paid up additions. Trent, in a simple language, explain to everybody what does a paid up addition actually look like.

Yeah, so a paid up addition is essentially.

Death benefit that is built on top of your starting that benefit. So as the book says, when it talks about paid up addition is an add on to your base policy. Your base policy is your starting death benefit that you get. And then what the paid up addition does, it adds on to that death benefit. So again, going back to that analogy, so your foundation, the base policy with the selling death benefit, and then the floors become the paid up addition that adds on a floor of death benefit on top of each other over time.

Excellent. Yeah, I always like to refer to it just to help people understand it. It's a paid up additional death benefit. So it's like you, it's all paid for, it's paid up, and it's a block of additional death benefit. So we start stacking those year after year. We start stacking more death benefit on top of more death benefit on top of more death benefit. And why does that matter? Well, that just takes us right back to the title of this book. And Trent, why does it matter that the death benefit. What's the advantage of this death benefit going up?

Yeah, so the advantage is, first off, you got to understand.

The contractual guarantee in play. The insurance company has a contractual guarantee in whole life insurance contracts, and that is by age 100, the death benefit and the cash value has to be the same. Okay? So every single day that you age, your cash value is always growing to catch up to the death benefit. It's catching up, trying to catch up to the leader. Okay? And so now by adding a paid up addition, what we're doing is we're adding to the leader, we're getting the leader grow even further, and we're adding floors to that. And so now the cash value, because of the contractual guarantee, has no choice but to follow the leader.

And if the death benefit the leader is increasing over time. What do you think the cash value has got to do?

Yeah, it's definitely, it's got to catch up. And it's going to every illustration that I've ever ran here in Canada when you get to age 100, because that's the age that those contracts are fulfilled, that cash value and the death benefit are going to equal each other. Happens every time. And life companies know that they design for that and that's exactly what will happen. Great. I got explanation, Trent. Now let's go and talk about well, how do you add these paid up additions? Now we're going back to the book again. The book is Cash Flows of Leaders. I'm going Back to page 32 and he says there's two ways to buy paid up additions and the first one is premium payments. So what do they mean by that and how would you do that? So here's what I'm going to explain to you. When you have a properly designed dividend paying whole life insurance policy, one of the things that's going to be available to you in your premiums is the option to buy paid up additional death benefit. So part of your premium can go to buy paid up additional death benefit. So the first part of your premium is always going to serve as the base, the base death benefit for that particular contract. And another portion of the premium you that you get the option to pay can buy paid up additional death benefit. So one of the things that we always say, because it's true, it's the behavior of the policy owner that's more important than the behavior of the life company. Because you as the policy owner, you get to decide am I going to pay that optional amount, am I going to buy those more, more paid up additions. Well, I'm here to tell you your focus should be on getting as many paid up additions as you can and stacking that death benefit on top of the death benefit you already got. Because cash value follows the leader and the leader is the death benefit. So Tran, talk about the other way that people can buy paid up additions.

Absolutely, Dan. So as the book suggests, the other way you could purchase paid up additions is by using your annual dividends. So with these whole life policies, every single year you would you receive dividends. Okay. And these dividends can be received in one of two ways. You could withdraw it in the form of cash, right? You totally could do that. Or you could roll it back into the policy.

Guess what?

Purchase data positions. Okay. And I think you can match which option you want to go with, because if you go with option two, what is it going to do? The dividend is going to buy more pay a petition which is going to add more floors to your death benefit. It's going to add to the death benefit amount and it's going to grow your debt benefit even further. And what do we want to do? We want to make sure the leader is growing so that the cash can follow it, the cash value can follow it. That's what dividends. That's the second way you could purchase beta petitions.

Exactly. Well said, Trent. Now the other thing we want to say to you, if you don't know what, you know, what we talk about when we talk about, you know, using dividend paying whole life and why do we use that product? Well, we use it as the platform for a very specific process called becoming your own banker, the infinite banking concept. Now I'm here to say to you, if you don't know about, well, what is that? Well, you should go watch this 90 minute video. It's called watchibc.com it's 90 minutes long you can take and you know, watch it when you have that amount of time available, help you understand the process that we use this platform being dividend paying whole life to help us do, which is become our own banker. And it's just a way of building capital that you can access capital. But go watch that video, just a great use of your time to help educate you on the whole process. Now the other thing I always think about is, well, you know, as I thought back to the book that we all associate and use as our foundation or this whole process called becoming your own banker, it's this one. And if you don't have it called Becoming youg Own Banker by R. Nelson Ash again, you can go to our website and get it. Now, one of the things that Nelson explains in there is that the importance of uninterrupted compounding. And as you put that dividend like Tran was speaking about back into your policy, you're going to build that next floor. Help build that next floor. And what that does over time is it creates an ever expanding uninterrupted growth, you know, growth of the death benefit. And again, why does the death benefit matter? It's because cash falls a leader. Now what we're always going to encourage you to do is think like a banker. Why would we want people to think like a banker?

The reason why we want people to think like a banker is because in the banking equation there are four players. There is the depositor, the Borrower, the bank and the bank owner. Right now most people probably you that's watching this video, you are simply the depositor and the borrower. But what we want to be is you want to be all for all four players. You want to be the depositor, borrower, bank and the bank owner. And so in order to be all four players, we have to think like a banker first. And to get you to think like a banker, you need to learn more about the process of becoming your own banker. Infinite banking concept.

Exactly. Now that's a good, a good explanation. The other thing I always think of when I, when I'm thinking of, you know, think like a banker, it's like, and until you can control, you know, your need for finance, you know, once you get that place and you can control that, everything that you do financially will be enhanced. It's kind of key to get that control. So there's lots of good information. And the two books that we talked about today, this one again I would like to take you back to and just in wrap up today, what we're also going to ask you to do is Click on the 7 minute video below and it's called Making Sense of Paid Up Editions. That's a great little video. It's got some great example of how paid up additions just help build the death benefit and then the cash value will follow. So with that, just going to encourage you to go watch that video.