The Controlled Compounding Strategy (The And Asset For Canadians 3 of 3)

You just the value of you showing up more powerfully in your financial life, your personal life, how you think about money, think about opportunity costs should enhance like that alone. Just because you have an and acid in your life, you should think different, you should show up different, you should be a more powerful investor, more empathetic listener. And oh, by the way, like that alone is valuable.

Section three of the book titled the End Asset for Canadians. Section three, the Controlled Compounding Strategy. Now this is going to be amazing. And again if just joining us, if you've skipped over section one and section two, you're a really ambitious person and you just want to get to section three. Well, I am just privileged to be joined again by Caleb Williams, dear friend, colleague and brother in faith, an amazing guy. Caleb, welcome back. We're hopping into section three now, truth be told, we've recorded all three sections back to back. We're doing this for the purposes of editing and getting the content out there in a snackable format. And so this next snack that we're serving up is titled the Controlled Compounding Strategy. Now in the book, this is right after page 107. So if you're in the book, just flip through past page 107, you'll be at section three, the controlled compounding Strategy. Caleb, welcome back.

I appreciate it man. And what's fun is if people have actually watched the series or if they've read the book, they will appreciate the way that this was written because builds on each other. So we talked about the importance of your why knowing that you are your greatest asset. We've talked about the wealth equation which really elevates efficiency and saying efficiency eliminates anything that's in your way to get to where you want to go. It highlights that to be efficient we need to think about long term and short term. Our long term word is going to be compounding. Our short term word is going to be control. And if you can maximize both of them, you will be wealthy. And wealth is essentially living life intentionally and there's so many benefits. Then we talked about true compounding, true control. We talked about things like taxes. We talked about things like what are institutions that are doing this? Well, banks. Banks are over a long period of time controlling money, getting money to flow to them and they're doing that. Well now it's all leading up to how can I apply this to my own life? Because if we just stop there, then it's like, Caleb, thank you for cutting open my wound and not, you know, filling it with salt. I appreciate that, but I Want actual solution. And this section's all about the solution. And I just want to be very, very clear. It's like we, I feel like we've been clear from the standpoint of, like, there's no get rich quick scheme. And there's no, like, do these three steps and you'll become wealthy. But we're giving you the principles and the foundations to build wealth. And so that is like the disclaimer going into section three. When we talk about controlled compounding, it's as simple as this. I want to know about a strategy that I can control my money and have it compound. Because I read in chapter one that efficiency is when I can control and compound my money. The. The whole concept of this chapter is if you could put your money in a place, hypothetically, you could put it. You put it in this place, you could posit it, you save it, and it grew the rest of your life without any interruptions, without any taxes, without any losses, without any fees. It just grew the rest of your life. And you could leverage, like the banks leverage. If you could leverage your money, allowing your money to continue to grow, but you could leverage that to utilize that for control. You essentially get a dollar doing two jobs rather than just one.

And how much money would you not want residing there?

I don't know.

Pick a number. I don't know, like, pick a number. Pick a number.

Right. I mean, if that's true, again, this is just this hypothetical.

And it is.

That's the concept that was like, okay, I think I need to do something about this. Because I don't see everyone articulating this strategy. That is, people don't do this. Why not? Because the banks, wealthy people, and the people that I'm learning from are doing this. But then I look like a crazy person when I talk about this. So essentially, going back to if you could hypothetically put your money into a widget that's safe, all this stuff grew over time like a tortoise. Lifetime growth had a legacy value, and you didn't have to choose between that or controlling your money. Would that be a value? We were in Milwaukee at a speaking conference talking about messages, and one of the epiphanies that I had was everybody is telling you that you have to choose between one or the other. Wall street, the banks, everyone. Jason, you can compound your money for the long term or you can control your money, but the problem with that is you're not going to get really any growth on that. And the epiphany that I had, and again, I Can't take credit for this other than just kind of like explaining it this way is like, we don't have to choose anymore. And it's based on the foundation of the controlled compounding strategy of valuing both control and compounding. That is why Wall street doesn't really value control. They don't teach about it. In our school systems, we don't teach about it. So, number one, they're eliminating that because they know if people value control, there's going to be dilemmas on where their money's at. That's the dilemma that I had when I was working at the bank because I'm like, man, it didn't sit well. It's just like, man, I feel entrepreneurial. And I also know if I put my money in this Roth ira, it hypothetically will grow to be a big number in the future. But the problem with that is then I have to say no to that money. Well, if I control that money, it's in a savings account that's earning no interest over my lifetime. That's millions of dollars. And it's like a first world problem here. But it's like, which one do I choose? And then the epiphany is like, oh, maybe I don't have to choose anymore. So that's the concept of control compounding, if you want to expand on that or ask any questions. But that is the framework of controlled compounding. And now we're going to talk about how you can actually get control compounding in your life.

Yeah. What immediately comes to mind for me is recognizing a fundamental truth that your money must reside somewhere. If your money can reside inside of an entity with all the attributes that you just described, again, it begs the question, how much of your money do you not want residing there? Recognizing that you can't put all of your money there from inception, this is meant to be done incrementally and gradually over a period of time. You talked about. This is not a get rich quick anything. I don't want get rich quick anything. I want get rich for sure over time.

The real question is, how do we do this? And I just have a chapter on creating your master account. I share that because we're talking about life insurance. And when people hear life insurance, they just get an emotional response. When I wrote this, I was a lot more nervous of that. Now I just. If I don't want to talk to someone on an airplane, I'll just say, I sell life insurance and I have a whole ride quiet.

My identity is not built around that. When I First wrote this, Jason, I was like, so afraid of this because I cared a lot more about what people thought of me. And I didn't want people to think I was just the scam artist that was coming along that, like, I got you. And that's why I wrote the and asset, because I wanted people to understand that, like, there's a reason why I put over six figures of my money at the age of 22 into this. I'm not delusional. Like, I. There's a system and a strategy for this. And I could just say that and it might not hit well. But if people understand, like, the principles behind it, they're like, why so little kind of deal? And I don't say that to brag. I just say that, like, when you understand this, you can't unlearn this. When we talk about life insurance, it's a very emotional thing. And so I'm going to break it down into three concepts. You have a contract, you have the life insurance company, and then you have the idea of it being mutually owned. And there's some other things that we'll go into. So the first thing is we have to understand when you're dealing with life insurance, what life insurance is, is it's a contract between you and the insurance.

Company, and it's unilateral and it's binding, Right? It's a legally binding contract.

Yes. And that's exactly what I, you know, it's a unilateral contract, meaning if once you enter into it, if you keep up your end of the bargain, they're on the hook to keep their end of the bargain, and that's powerful. And there's tax benefits to that. There's value as it relates to regulations. It's really benefit to understand how contracts work. And that's what life insurance is. When you think about it, regardless of what kind of life insurance you're talking about, you. You're doing one thing. You're providing an input, they're providing an output. And so the first and foremost is we have to understand the power of the contract. And we also have to know that a contract is with another entity. And so not all contracts are created equal. Not all entities are created equal. And so let's talk about both of them. When we talk about the entity you and I do business with, Mutual companies.

That's correct.

Mutual versus stock companies, essentially saying, who does the. Who does the benefits? Who does the profits go to? Does it go to the shareholders? Does it go to the stockholders? You know, Warren Buffett loves to buy insurance companies because they're profitable. He gets the benefit of the profit. Whereas the shareholders, people that are a part of mutual companies. And the only way to do that is to have a contract with that mutual company, get to participate in the ownership of that. And so number one, if we're doing business with a mutual carrier or a stock carrier, a mutual puts the. It elevates the contract and it elevates you if you're part of that all day long.

And the mutual company can only be responsive to the participating policy owners.

That's right.

There's no one else to be responsive to.

And when you exercise your ability to leverage and to borrow against your value in that contract, you co own the lender.

Correct. And I'll use a very extreme example. There's mutual companies in both Canada and the United States. There's one mutual company in the United States that is going through a mutual to stock. And the reason I'm sharing this with you is while big picture, that's not a good thing. Every single person that's a part of that mutual carrier is literally going to get paid out like an owner of that company. I share that because if they weren't a mutual company, that wouldn't even be a consideration. Right. So regard and I'm using an extreme bad example like this stuff doesn't happen. This is a really crazy example. And even in the craziest examples, having a mutual carrier translates into way different than a stock carrier. Okay, agreed. So understanding the mutual ality of a company, understanding that long term matters, track record matters, and making sure that that company is transferring their profits not just to make them safer, but ultimately transferring those profits to you in form of dividends and payments. So it's important that the company that you're working with is solid because you can have an amazing contract, but it's only as good as with the company that it's with.

Okay, absolutely.

Yeah. The contract. Not all contracts are created equal. And I'll be careful with this and I know that every country is different, but there are ways to design contracts that enhance things that we care about. That is compounding and control. And so all I'll say with this is when we talk about overfunding, when we talk about max funding a contract, what we're essentially saying is we utilize life insurance contracts with mutual carriers. And what we do is we make sure that that contract is maximized for the cash benefits and long term benefits, that is compounded benefits, but also control benefits. And it goes back to the Controlled compounding strategy of if I could put my money in a place that long term it's going to be good. And someone's like, oh, that's what the book's all about. The and asset and have the ability to control and to utilize that capital. Super, super powerful. And I'm telling you it is possible in a contract that's well designed with a mutual carrier and it's called whole life insurance when set up and used properly. And the reason I say when set up and used properly is you and I both know a ton of examples of the right company, bad setup. The right setup, bad company. And I'm not saying this to scare anyone, I'm just saying make sure that you're working with someone that really understands this, because there are many people that don't. I'll just say that there's a lot of people that use this book that don't set this stuff up properly. And I hear about it and it doesn't make me happy. But all I'm saying is the epiphany that I had is life insurance, when set up and used properly, JLO is not an investment. It's not going to be the most sexy compounded vehicle. What it essentially relies is it's an asset that allows your money to be stored. Oh, by the way, there's so many benefits. It's protected, protects you. It protects your human life value. It allows your money to grow when set up and used properly with special tax advantages. That's what I'll say for this recording. It also allows you to utilize capital without hurting the lifetime value of your dollar. Amazing. And it protects your legacy from the moment you fund it.

Yeah.

And it guarantees that what you want to happen will happen regardless if you live to see it or not.

Absolutely. And it creates an ever increasing pool of money that empowers you to take advantage of opportunity on your terms. Everyone needs to be well capitalized. And when you're well capitalized, opportunity will track you down. And when opportunity tracks you down and you decide to pounce, you get to do that on your terms. Control, compounding, uninterrupted compounding. And again, respecting the fundamental truth that your money must reside somewhere. And we often say that the difference between you staying stressed or getting relaxed financially is who is controlling the banking function in your life as it relates to your needs. And we expand on this in the book. The end asset for Canadians, and one of the fundamental, to coin a phrase, the end asset is that this is not an either or. It's not hey, should I invest in Bitcoin or should I purchase a dividend paying, participating whole life insurance contract or a system of contracts so that I can implement a process of becoming your own banker. The infinite banking concept. It's not an either or, it's an as well. As if you aspire to invest in Bitcoin, to invest in real estate, to buy, acquire, expand, grow companies, whatever it is, there's going to be financing involved and financing is involved even when you pay cash. And so the question is, who is going to control that function as it relates to your needs? It can and it should be you. That's where it should be controlled at you and me, our level. And when it is, oh boy, the peaceful, stress free life that it can create for you is you cannot calculate return on peaceful and stress free. There's no concept or calculation that can be done.

And the ironic thing is, and you know this about me, Jason, and sometimes I feel like I give you sometimes heart attacks sometimes. But it's like we are trying to put a calculation on it. It's impossible by the way, but we're creating an and asset calculator which looks at the internal true rate of return, the external rate of return, the legacy rate of return, the options that translate the other protection items. And to give you an answer, it's impossible to actually put a calculation. But when you start looking at all the things that happen when you have your money residing in a place that you're maximizing, compounding control and really I will say being efficient because remember, efficiency is taking long term and short term. I am the crazy person that's like, hey, we should be able to put a value on this. It's hard because what is the value of safety? What is the value of having your family protected? What is the value of a long term care like benefit? What is the value of having your money grow in a tax advantaged way versus not. That's the point that I'm making. You might value it different than I do, but my point is when I grew up in this industry I was like, everyone's saying that life insurance is better than your investment. And that's how it was talked about. And I was just like, man, you gotta be miserable to build your empire on that message because I would disagree with them. But at the same time, when you understand what we know, there's no better place to store your money.

That's right.

And the sad reality is I agree with them. For the average American or the average Canadian, life insurance will outperform an investment. And that's not, that's, that's not the pitch because it's just, it's just the and component. And if you can earn a greater rate of return than life insurance, amazing. Utilize the and and get a dollar doing more than one job.

Yeah.

So I'll end with this. It's a drawing that I do all the time now and it's drawing a human being and then it's drawing that dollar. And that dollar represents you putting your money in an and asset. And I draw one line that goes lifetime compounding. That's cool, that's valuable. Then I draw another line that says control and use. And oh, by the way, it's an and you can do both. And then I draw another line that talks about future. The and asset enhances your future options. Depending on what your philosophy is, it enhances it. Then you draw another line and you draw a little protection around that person and your money. By the way, the moment you fund an and asset, it protects you and it protects your wealth. And then I draw another line at the bottom that represents save more. Because Nelson talks about volume, we need to be obsessed with the volume of savings rather than just the rate. I believe you can save a whole lot more money when you're talking about the and asset versus an investment because of control. When you increase control, you increase the ability to save. So what's the value of that? And then the most important thing is I draw a arrow from that person. Because if you cannot live better, if you can't live more intentionally with an and asset in your life, you're not being coached. Well, that is you just the value of you showing up more powerfully in your financial life, your personal life, how you think about money, think about opportunity costs should enhance like that alone. Just because you have an and asset in your life, you should think different. You should show up different. You should be a more powerful investor, more empathetic listener. And oh, by the way, that alone is valuable. So for me, you can't even compare this because there's no other asset that works like this. And that's when I realized that I'm going to be the uncool kid that writes a book on life insurance because I just can't unlearn this stuff. And I'm not here trying to badmouth any investment. I'm not here trying to sell you anything. I'm just here to tell you why I have a totally different philosophy as it relates to money. And at the end, it really is rooted on my why and living more intentionally. And by knowing this, if you're a client of mine, if you're a client of JLo's, you'll understand by knowing this, you should be a better client. Because there's people that fund these contracts and they don't get it. And so it's less valuable to them because they just see it as a widget. No, the widget should change your life. And I don't say that to just be over the top. It literally should change your thinking, which should change your life.

Well, there you have it. And if you found these videos helpful, your next step is to head over to AndAsset CA. Again, that's AndAsset CA. The link is right there above the fold. Just go ahead, click on it. That'll take you over to the webpage. When you get there, you can order a copy of the book, have it delivered electronically. You can purchase a copy, a hard copy, and have it sent to you anywhere in Canada. And you can also create time to meet with and be connected with the right person on my team. Caleb, this was an amazing video series. Thank you so much for committing your time and your expertise to helping to further educate Canadians on how to go about accelerating their financial independence and to be able to picture a day when financial control is back in their hands. Not the bank, not the government, not some temperamental stock market, but taking back control and placing it in their hands and really understanding the advantages that that represents not only while you're alive, but long after you're gone. And this was just, this was amazing. And so thank you. Thank you again so much.

I appreciate you, I appreciate your company, I appreciate our partnership. Excited to see what the future holds and excited to see what people do with this information. My hope that it is that it translates into some type of value and it affects the next generation. So, Jason, thank you. I know the best is yet to come and I appreciate doing content with you and I'm excited to see the ripple effect that you and I are going to have by sharing this message.