Pay Off Debt, Save Money & Build Your Financial Life In Canada

So it's not so much that he, the policy solved his problems. The policy is just a policy. It's what he did because he had the right foundation of knowledge which we've been building all day today so that he could implement this effectively and see the success he wants. All that financial energy that's owed to the insurance company is for the benefit of everyone who's an owner within that company. Dividends that are paid long term to us as policy owners because it's a free contract with other three people.

So here's our chiropractor and he had an objective. He wanted to eliminate $420,000 in debt in less than 21 years, which is what it would have taken him doing it his old path. He was 47 years old when he got started. When he found out about this process and wanted to look at doing it. $420,000 in total debt that included two mortgages in that one was a rental property. His banking system is going to start off with $20,000 a year and $20,000 in year one and he's going to keep that up. We're going to walk through that a little bit. Now here's the thing to get this going, he didn't have the $20,000 available, so he actually to initiate it, he actually borrowed in this case, which we don't necessarily recommend. But this is a unique circumstance to get the initial 20,000 to get things going. And that's actually included in the total number of the debt. So it's going to be recaptured as well as part of the process. Now he has patients that come in like any good chiropractor and he charges about 50 bucks a patient visit. So the thing is he has scheduled appointments and then he also has walk in traffic. And so roughly there's a patient or two a day that are no shows, but he has one or two patients that show up as walk ins. So in other words, a patient or two a day doesn't make or break his business. Okay, so that's a hundred bucks a day. He spends 200 days a year working actively in his practice. So 100 bucks a day times 200 days, very simple. That's $20,000. So people sometimes ask us, well, how do I know what I should be doing or funding my program? Well, you know, the reality is that's a good one on one discussion with your coach to really see what your resources are. But a good way of thinking about this, especially from a business owner standpoint is what are you charging a day for Your work, for your efforts, you want to at least be putting some of that away. So as an example, you know, our real estate agent or something, okay, put two deals of the year away at least to fund into your own program and commit that money to pay yourself first. So now, moving forward from starting this point, he's actually going to have one of his team members at his office is going to basically take the first two transactions a day, or at the end of the day, they're going to reconcile and it's actually going to get sent into a separate account. So the money is accumulating for year two. So it's there for paying his premium every future year moving forward. So again, so we didn't have the 20,000 on day one. So he's actually going to take a private loan to get this thing operational and that's going to get recaptured. We're going to show you that in a minute. Now, the actual amount he took was 30,000 because he built up this pretty big problem in his life. And would you believe it, his spouse.

Wasn'T happy with all the debt that they had and all the 15 debts.

That we're going to show you.

And so he actually took her on.

Vacation and they got a chance to talk about how this new strategy was going to work in their life and how it was all going to work out in the end and they were able to actually, you know, keep the peace in the house, you could say. So here we go. His objectives, let's just recap. He wanted to be able to get this done without working any harder, without taking on too much risk. He didn't want to change his cash flow because he was used to making a certain amount of money. He didn't want to have to be forced to work in his practice more days of the year. And he didn't want to lose control over his money. And more importantly, super, super critical, he didn't want to leave his family with all this debt if something were to happen to him as the primary breadwinner for the house. So here's the solution. He's going to recapture that debt using the process, I repeat, the process of becoming your own banker. Now, let's jump into some numbers here. Again, it's okay to have an idea what you want to do, but you also have to initiate the plan and actually take action. Nothing happens without implementation. So here we go. This is a look at his debts. I'm going to zoom in on some of this. So if you're on a little mobile device, it might Be a little difficult, but I'm going to do some drawings here and I'm just going to highlight on a couple of them first. And then we'll be zooming in to take a look at these things a little bit differently. So over here you see his deposit of $20,000. We're going to see a policy loan column. There's a separate checking account. We're going to talk about that in a moment. And then over here you'll see each of the debts. So you go across the top, there's nine of the debts. And then because it was so many of them, there's 15 in total. We have a second page. So I'm going to focus on the first nine debts and then we're going to zip into the next page as.

We go through time and we're going.

To look at all the months over the period of this recapturing process. As he starts to chip these away. Now, I just want to highlight. So what we have here, Home Depot 2647. Well, that's the balance that remains on it and the payment that he was making. So you see the balance that he owes and then the payment that he was giving the third party creditor. Okay, so each one of these has a payment, an interest rate, how many months it was going to take to complete, paying it off, going that rate with the payment he was already giving the third party.

All right, now over here again, I want to talk a little bit about.

This separate checking account and some of these other line items.

So here he's funding the policy of $20,000. He's immediately going to initiate a policy loan of $11,200. Within a few days of that policy, you know, going active with the life company, he's going to move that money over here into his checking account. And now he's going to pay off Home Depot, he's going to pay off the debt with Target, he's going to pay off the BMO, MasterCard, and he's going to put a little bit of money down on this Visa. So you see the payment, the minimum required payment he was giving, that Visa drops down a little bit. Well, if we take all of these payments and we add them together, it's about $665. He rounded it up just to keep it an even number. So he was already sending $665 to all of these creditors. Now he's obliterated a few of them, put a little bit down on another, and he's taking the financial energy that used to walk out the door. And he's bringing it back into his household. So it's now stocking up and refilling his separate checking account. So he's filling the account, filling the account. Now he has a debt right here. It's called Wallace practice. This was one of his. He had two chiropractic offices, and this was a debt that he had for one of his offices. Now that debt naturally pays off. He was making a large payment of 1,054amonth. It was only seven months on that debt. So that debt paid off right here. Now, when that happened, we said, look, what do you want to do with this? You know, you've been making this payment for about 10 years on your practice. You're pretty accustomed to having in your budget. Now, do you want to take that money and, you know, use it for something else? Do you want to go and, I don't know, put it back in your budget some other way, or do you want to put it into your program and put steam on this thing? Do you want to really amplify what we can do by recapturing these other debts? He said, I want to put it back into the program because I need to get this taken care of. It's been weighing on my shoulders for far too long. I just want to get this done. Let's keep the money going in the program. So he takes that financial energy, and it comes over here, and it adds to this checking account that he's building up, building up, building up, building up. Now we get out to the end of the year, he's accumulated a balance in that account of $13,255. So $13,255. We're now in month 13. Guess what? It's time to pay premium for the second year of his policy. Now, he didn't have the money before the first time, and so he changed his behavior. And he said, look, a patient or two a day doesn't make or break my business. Moving forward, I'm going to commit two patient visits a day for every day that I work in my practice, and I'm going to have that set aside so the money is there for the next year to fund my premium going forward. And I'm changing my habits, and I'm doing it immediately, and I'm going to automate it so I'm not even involved. I'm going to have my staff members just take care of it for me. So he set that up so it was on autopilot. So that's how he's funding his premium. Now we're over here to bring my pen back up. So he funds his premium again. And by doing that, he immediately creates access to new policy loan value. So he's taking a brand new policy loan at the beginning of month 13 for 17,540 bucks. Well, if you add that number to this number here of the 13,000, that gives us almost 31 grand that he has access to. Now, couple key things I want to highlight here. He took a policy loan in the very first year. Now he's taken a second policy loan. @ this point in time, he has sent zero money back to the life insurance company. He has not put anything back on policy loans. Now he will do that at the end. I'm going to show you how he's going to pay those loans back. But for this purposes, because the loan with the life insurance company is unstructured, he doesn't technically have to make a payment back to them. His focus is on getting rid of his other, you know, the snakes and dragons, wants to get rid of these other third party debts so he can control that cash flow back into his life. So here he takes his $30,000, he goes over here and he knocks off the rest of CIBC Visa. He comes over here and he knocks off the rest of this TD bank debt. He clears off his debt to the, to the government, he clears off this Royal bank debt. And if you take a look, he didn't get all of the Sears card done, but he got most of it done. He's knocked it down from almost 12 grand all the way down to $2,000. And the payment he used to send Sears was 300 bucks. Now Sears only needs $55 because the balance is much lower. So you take these items, there's 300 bucks, there's $725, there's $425, there's $250. We add all that financial energy together and we look at every payment that was happening on this whole stretch here. So we've got all of these debts, each payment, except for $55 is now coming back over here into a separate account and he's committing those payments that he used to give everyone else over to an account that he controls with his family. And he's accumulating those balances and he's being an honest banker. Whatever he was willing to give someone else, he's going to continue giving that to himself so that he can put speed on this process. Speed. Okay, when we get to the end of the year, you'll see at the end of month 24, he's accumulated a nice healthy balance of $43,500. I'm going to flip over now to month 25. So we're going to go to the next page. Here was month 24 right up here. So now we're seeing, we're at the beginning of the starting the third year, month 25, you can see we have the separate checking account. And now we're looking at debts 9, 10, 11, 12, 13, 14 and 15. The last two on the list here are actually two mortgages. And now I want to highlight for everybody. Let's get my pen back up and running. I want to highlight debt number 13. If you guys look at debt 13, this is the private loan that he took out. So remember, he didn't have the capital to get started in this right away. Debt 13 was actually the private loan that he started so he could get 20,000 to begin year one's funding and he still had 10,000 left over. And that's how he took his wife on a vacation, et cetera. So this debt is also going to get eliminated right away and we're going to show you exactly how that takes place. So now he pays premium.

In the beginning of the third year, he was putting away two patient visits a day that happened the entire year. He funds premium. He accesses a new policy loan. No policy loans have been repaid at this point. So he's taken three loans. He's got an accumulated balance with the insurance company and there's interest that we got to pay those guys. We're going to get to that in a moment. He takes all of that capital and he tax it together with his checking account balance that he saved. He has 61,735, almost $62,000. Boom. Let's get rid of Sears, let's get rid of the Scotiabank loan. Let's get rid of his second practice that he had for that. He, you know, the debt on his other business. We're going to get rid of this one. I'm pretty sure this one was a car loan. And we're also going to get rid of the third party loan that we use to get this thing operational. Big, big, huge difference. And then a whopping like $200 goes onto the mortgage. The payment on this mortgage doesn't change at all. That's still the same. But he just recovered all of these payments and that's getting added together with all the other payments he was doing from the first page. So just month after month, after month payments were going out the door. Now they're being redirected into a separate checking account. So it's the same thing he was doing to everyone else. He didn't change his cash flow. He's not working any harder. He's simply changing the process. He's changing the process by which he was getting this done. At the end of the year, he's got $69,000 accumulated inside of that account. So now he's got $19,000. He takes $20,000, puts it into the policy again. He sent no new money back to the policy yet, and he's borrowing out $19,000. So almost. Almost what he put into the policy, you tax that together with the $69,000, he has $88,000 here that he can go to work with. Well, he comes over to his rental property that he's got, and he knocks that balance down pretty substantially. He has about 60, whatever $7,000 left on that debt. Well, the very next month, he's got capital basically coming in from his redirected payments. And he just says, you know what? I've got enough in the account after the first month that I can basically take care of the remaining balance. And boom, that debt's gone. I just recovered $751, and I'm going to bring that financial energy back over here where I can control it. Because he had been making that payment on that house for a long time that was in his budget, very accustomed to it. In fact, in that situation, it's a rental property. The tenant was paying the payment anyway. So he was able to just reapply that energy back into his account, his accounts building up, building up, building up, building up. And then, bam, at the end of the year, $71,000 is available. And let's flip over to page two or page three, I should say. So this is a continuation. Now, here we are. Here was month 37. Here's now month 49. So here's that $72,000 that he had available. And now we get to do something fun. The minimum premium on his first policy was $8,000. He decided, because now he's been doing this for a while, he's actively. You know, I don't know about you guys, but I would imagine if you were rapidly repaying debt like this, what would happen to your shoulders? Would you be able to put them back a little bit more? Would you be able to stand tall? Would you feel good about the situation? Would it take some of the pressure that was on your financial.

Life?

Off. Well, it's exactly what happened for him. Turns out it ended up being happier in his life. He was making more money in his business. He found some new capital. He said, look, I'm going to pay the minimum on this policy and I'm actually going to start a brand new one. So he was able to find an extra $8,000 in his budget. Now, because we've been able to recover capital pretty well, he uses that to pay the original policy, and he's still able to put $9,300 out. So he put 8,000 in and he can borrow 93 out. He's at a point in that first policy where he's got Live Steam. Now he starts the next policy, because if he can get Live Steam once, let's go get a new one started so we can create Live Steam again. He starts a new one, borrows from that policy. So we add these two numbers together, we tack that on with the 71,000, and he has almost $92,000 to work with. Well, let's bring it over here. Let's plonk that down. On the primary house mortgage now, that brings the balance down pretty substantially. And here's something really cool. Turns out he was pretty close to renewal on that debt anyway. He just decided, well, now that I've reduced this balance so much, why don't I recast the loan, re extend the amortization out to like 30 years. That'll take my payment and drop it down substantially. Now, that is counterintuitive to what we've been taught mostly in Canada. We always thought, okay, well, you want to pay the mortgage off faster. Well, he's going to pay it off faster, but he wants to do it under his terms. So he reduces the payment by stretching the amortization out. He goes from paying $1,111 and he drops that payment all the way down to. To 410. That differential in money is now being applied, guess what? Over here, into his separate checking account, accumulating up. So he's making the same payment. He didn't change the payment. He simply changed who was getting most of it. Now, by the time he gets out to month 57, he has accumulated enough money in that account that he can blitz out the remaining balance of that mortgage. In other words, he didn't have to wait 30 years. He only had to wait about seven months, and then he was able to take care of business. How cool is that? And more importantly, how empowering is that? Very, very powerful. Now, he drained that account balance down, but he's still sending his payments at the end of the year. He now has a balance of $35,000 set aside in the account and he doesn't owe any third parties anymore. But we're not quite done yet. What are we missing? What haven't we tackled so far? What do you guys think? I want to hear from you in the comments. What do we still have left to accomplish doing? So let's take a look at that, summarize what has actually happened. Okay, so well, all the debt is gone in 57 months versus the 21 years it was going to take him going the way that he was working because he got some good coaching and he learned a new process of how he could change his existing situation by changing his behavior. So it's not so much that he, the policy solved his problems. The policy is just a policy. It's what he did because he had the right foundation of knowledge which we've been building all day today so that he could implement this effectively and see the success he wanted. Total dollars he put into the policy in premium was 108,000. He took out policy loans, money that he actually took out and used and paid to his debts of 86,000. But he recaptured $420,000 of debt. Well, most of the other recapturing came through the natural payment process and the redirected cash flow that he recovered. So let's summarize what this actually looks like. Alright. There was interest that he owed the Life Company. Got to remember that we didn't send any payments, zero payments went back to Life Company for that whole 57 months period of time. Well, that's going to accumulate some interest. Now at the time that this was going on, the interest rate on that policy was 7.5%. He accumulated $17,000 of interest to the money pool of the insurance company. Now who owns the insurance.

Company? Policy.

Owners. Policy owners. That's right. Boom. High five. Which means all that financial energy that's owed to the insurance company is for the benefit of everyone who's an owner within that company. Very, very important. That goes to support dividends that are paid long term to us as policy owners because it's a free contract with other free people. Now today, if he was doing this, the interest rate on that particular company would be about 6.2%. So here is what he borrowed. 86 grand, he had some interest, which means the total loan balance now on the two policies was 104,000 bucks. He's got $7,640 of financial energy that used to go out the door every single month that now can go directed towards the insurance company's money pool to pay down the loan. When it's all said and done, he's got it all paid off in 13.5 months. So it took him 57 months to get rid of the third party banks, the snakes and dragons. And it took him 13 months to replenish his savings, replenish his savings at the insurance company. So he can repurpose that money now in that 13 months, let's call it 14 months. What happened to the cash value inside of his insurance contracts? All the loans are repaid less, Basically less than a little under six years. He has access to all of the equity now. He can reuse all this $86,000 plus any new accumulated growth. And most Importantly, he has $7,600 of monthly cash flow back. Well, I don't know about you guys, but if you had all that back now and you didn't have the third party debts, if he was being an honest banker, where should he now think about applying a large portion of that cash flow? What should he consider doing now for his.

Family? Another policy Seems like a pretty good idea to.

Me. Another.

Policy. So let's do a quick recap. Did he accomplish his objective? You betcha. He got rid of all the debt. Did he have to work any harder? No, he still did 200 days in his practice. He just got to take the pressure off his shoulders. I bet his wife was a lot happier. Did he lose control over his money? Most definitely not. Did he take on any extra risk? Actually, not only did he not take on extra risk, he actually reduced his risk because now he's got proper insurance. So if something happens, the family's.

Taken care of, whereas beforehand that was not the.

Case. Did he change his cash flow? No, he didn't change his cash.

Flow. He simply recovered the cash flow.

That was walking out the door. What did he change? You got it. It's all about the process. That's what this is about.