Jayson Lowe recommends comparing four financing options before taking a policy loan: paying cash, using a credit card, taking a traditional loan, and using the policy loan itself. This "contrast filter" shows you which choice has the best net financial effect.
What are the first things to consider to take out a policy loan for? Well, I would say that if you contrast it, so one of the considerations that I always go through even to this day is I contrast it. If I know that I'm planning to purchase something, I'm running it through the contrast filter. Okay, what would the net effect be if I just paid cash? What would the net effect be if I just used my credit card? What would the net effect be if I just took out a loan or leased? And what would the net effect be if I utilized the policy loan to control how I financed this specific thing? Whatever it is. And so consider the alternative. That's what I would consider before accessing a policy loan.
