Live IBC Discussion with Richard and Vern

Right now or are we late? We're late, aren't we?

Well, but it doesn't matter because if we hopped on in 30 seconds, we're going live. Let's go. So it's always fun when we do lives because for people that maybe don't know, one of the things I like to chat about every once in a while is the Colby Index. K O L B E, Colby. If you're not familiar, you can go to K O L B Colby. I believe it's Colby.com and you're looking for something called the Colby A Index. And I don't know, there's like 36 questions or something you answer. And people like to refer to as like a, like a personality assessment. Man, I gotta really work on. I'm using a lot of air quotes lately. I can't help myself. Something about like the camera and I'm like, what does it look like when I frame my head like this? Is this a bunny? But the. Do you remember on snl, the. I think it was Chris Farley? He was the guy, his name was Bennett Brower. He would do on the weekend updates, and he'd be like, so what if I don't use deodorant and brush my teeth regularly? Anyway, Sometimes I do that in client meetings. But talking about the Colby Index, just really quick, and then we'll, we'll talk about IBC stuff. But I, you know, both Vernon and I are high Quick Start. So there's kind of four measurements of, you know, how you do things. And Colby isn't really personality related. It's more about instinct. It's your instinctual, natural way of doing things, of attacking a project or, you know, completing a task, et cetera. And so Vern and I are very high on the Quick Start index. So whenever we hop onto a call, a lot of times, well, what are we gonna talk about? I don't know. Hit go button. Let's go. Let's get started. And then it just kind of develops from there. So it ends up being fun and engaging, and it's a varied amount of activity and discussions that can happen, which usually there's some ideas that get generated in a conversation like that, would you say?

Yeah, I wish I, I wish I could say, Rich, that I don't occasionally over leverage my Quick start, but I certainly, certainly do. But I'll tell you, thanks for sharing that with me back in the day when I first discovered it, because, I mean, procrastinators are killer for everybody, but particularly for you and I. These, these Quick starts out there. If I don't have a plan in place to take the action, or if I don't take the action immediately, consider it's not going to get done. Procrastination is a killer for me, which.

Which is funny because we, we just finished an amazing podcast recording with one of our teammates, Niffer, which was a ton of fun, so can't wait for that episode. But one of the things you mentioned before, we kind of started the call, we were doing a bit of a positive power up, which is something that we, we do frequently at the Ascendant organization. And you were indicating that, you know, hey, you kind of burned in the midnight oil last night and you, you basically smashed out a whole bunch of, you know, a backlog of work, right? Because we have meetings. A lot of times we're doing meetings. It's back to back to back to back to back meetings. And you do that for like two, three days straight. It's, it can be a little taxing. You're, you're on zoom, you're sitting in your chair, you're at a standup desk, and it's just non stop meeting to meeting to meeting meeting. And then there's a lot of tasks that get created as we're helping people implement this process in their life. And, you know, but you need to have time carved in your calendar to start really working on that stuff. You got to do a needs analysis, you got to prepare, you know, some illustrations. You got to, you know, you got to think on what you learned in that client meeting. And, okay, how can we structure and plan? Like, there's some really, really intense, focused effort that has to go in and it's, that's a lot of thinking work. Right? But it takes time, and we got to put that time in because how we're helping people is what matters. And, and you, you, you using reminders with that thing. What are you doing with that?

No, what I do is I. What I do is I. When I finished my last client meeting last night, I had dinner with my family and I said, hey, what do you guys want to do? Dad's going to put in some midnight oil tonight or I'm working late Friday or possibly Saturday morning. What do you think's best? They're like, dad, go crush it. I'm like, cool. So I put on like shorts and a T shirt, got comfortable, grabbed my, what do you call it? Spotify playlist. I turned on my Bluetooth and I just like, blasted the music and I just, it's like, I'M in my zone getting everything taken care of. Right? So that's why I showed my, my speaker that that helps, you know, pump the energy up.

Yeah, I love it. I love it. And you know what? And that's the thing. You. So you've got, like, a little mental trick to help you get through that. But, I mean, it's enjoyable, but it becomes more enjoyable to do it that way. And you don't have to kind of be, you know, front stage necessarily. You're not, not on with people at that moment, but you're working on really critically important things. And, and, you know, even I find, you know, yesterday I had a pretty, pretty busy meeting and, you know, because of my quick start and other Colby related activity, you know, people who have meetings with Richard, they, they start to learn real fast. Richard's not so good at watching the clock. It's, it's a, it's a real downfall of mine. So I, I'll even begin a lot of my means, like, just so, you know, heads up. I tend to not pay attention to the clock at all. And, and some of my meetings tend to go long because I just get so ingrained and engrossed over doing our conversation and, like, the thinking and the planning and the discovery and the questions that get asked, and I just kind of lose myself in that activity because it's not only it highly enjoyable, you know, but we're accomplishing something. We're working on something really important, and then all of a sudden, like, I get a reminder pop up and they're like, your next meeting starts in five minutes. Like, oh, right, I gotta go wrap this up very quickly. And so, you know, that's, that's part of my, my nature, my. And, and it's, and it's, it has been beneficial for me, but it also has counterbalance of where it's. It's not as well. So, you know, I recognize that it's something, you know, we're, we're all a work in progress, right? We're all trying to get better in our, in areas of our life, you know, and that we want to improve. And that's an area that I'm always seeking improvement. Sometimes I find, like, little Jedi mind tricks that work for a little period of time. Like, you know, these are not the droids you're looking for, but they don't. Oh, they don't always work or they work for a limited amount of time. And then I have to, like, you know, I have, I need some other Jedi to come and, like, you know, Get. Get me back on track. So. But interestingly enough, on that very same topic, I was talking with a good colleague of mine the other day, Jimmy, and he's, you know, really good guys, amazing coach, and he's talking about, you know, the power of Habits and a book, a couple of books that he's reading, one of them, Atomic Habits, and it's been on my list for a long time. I haven't got to it, but actually smashed through most of it on audiobook over the last three days. So back. Back on Audible, it's been. Been a hiatus since I've been doing that, but I'm back on it, and it's good to hear, you know, like, these little, small, intricate things that we do that create habits that have a really powerful effect in my life. And it's. It's the small thing that leads to the next thing and the next thing and the next thing. And I was thinking as I'm listening to the book and I'm trying to implement some new, you know, routine, morning routine. Habits. Routines are very difficult for me and that I. Let me rephrase that. I'm going to change my language. I have not prioritized routines in my life because they're kind of the antithesis of what my Colby says I should do. It says I should not be routine oriented in any way. And that usually works out all right for me, but there's certain areas where I really want to have a little bit more routine. So I'm focusing on some morning, new morning habits for myself, and I'm really happy about how it's going. But as I'm doing that work and I'm thinking about this book, I'm thinking about the habits that are important for ibc, the habits that we're teaching and helping our clients learn and understand and having, you know, discussions with them on a regular basis or having them embrace the content that we're producing so they can really embrace those habits. They. They're. They're going to watch a video from, you know, Sarblo or Roman or yourself or Jinjin or some, you know, Jason or some other member of the team, and there's like, some comment that just sparks them, like, oh, that's like the little. That's the little nudge that I needed to improve that one thing a little bit more efficiently.

It happens. Rich, I'm so pumped. I'm so grateful for the team. I'm so grateful that I'm not the one who has to do all that on my own, because just yesterday I met with my client and they were referring to maybe a couple videos that I was a part of or that I recorded. But just like what you said, they're dropping. They actually know our teammates. They're dropping other people's names and say, oh yeah, Roman did this video and he said this. And man, that really got me thinking. That's why I booked this meeting today. Like, how good is that? Right? Like that. That is so good. And, and you're right about, about the, the habits. I'm with you with that. I, I struggle. Maybe you can coach me on the language here. I, I find it sometimes challenging to really create those routines and habits. I've often said this to you where I'm really good at following a process. I'm not really great at creating the process. So I think. Is that the, is that the follow through? Is that on the Kobe Report? Is that the follow through? I'm not sure. But, but I'm, I'm good at following the process. But if you ask me to create the spreadsheet or do the this or do that, that's another reason why I'm grateful for the team. In fact, I, I showed on a video today I, I just recorded with Roman earlier. So make sure you go to Bankers Vault. Eventually this won't be getting processed and posted. I can't remember. I don't know when it's going to get posted. Post posted. But we recorded the top five money leaks for Canadian families. And so we talked about the things that can have you leak money and that you don't even maybe notice it. But more importantly, what are some systems and processes that you can put in? Of course, tied in with the process of becoming your own banker, but how can you actually tighten up those money leaks and make sure that that money is being accounted for and flown back to your family system? But it's. It's one of those things where I have my own policy loan tracker. I updated on a monthly basis. And I'm so committed to it. It matters to me. And when things matter, you prioritize the time. Just like what you're doing with the atomic habits. And you recognize that, hey, there's probably some benefit for me to create some kind of a morning routine. Right. So same with, you know, managing your system or whatever.

Right. Well, and it's funny that you mentioned that because in our client portal, for anyone that's a client financial, we have a client membership portal. Many people will be familiar with it and there's a ton of. Not only is there a Boatload of content in there. There's also a ton of, like, kind of templates and resources. And so there's. There's links to access a loan amortization that we recommend you use to build an amortization or take a policy loan. How do you want to set the repayment terms? You control all these things, but the act of. Of opening it, of printing it, of making that happen, totally doing that step is telling your brain this is important. And here's what. Here's a commitment that I'm making. We have a loan commitment template that we've built with where you can write down, hey, I, you know, Richard took a policy loan from this policy, and this policy, and this one was three grand, this one was ten grand. And so it's $13,000. I'm applying this too. And there's like, checkboxes. So what are you putting it towards? It's like repayment of debt. I'm recapturing this. I'm buying a car. I'm making an investment. I'm buying Bitcoin, like, whatever it is that you're doing. And then there's a big other box, and you just fill in whatever it is, you know, so get specific with that. And then how I intend to repay this back is by doing blank. And there's a couple checkboxes. And so then there's like a page two, which is just like. It's like bullet points of things to remind yourself and be aware of. Don't steal it. There's a. Literally, there's a picture of a can of peace right on it, and you can sign and date it. And so we've been trained over our life that when you sign your name to something that is usually important, you're making a commitment. You're signing a contract, usually, you know, mortgage contract, real estate purchase contract. Like, these are things that are really important decisions where you sign your name, and so they're. The act of doing that is just one little kind of habit. And when you're talking about being your own banker, those little things matter, and they compound and they build up. And then you start to see, okay, maybe you have kids and they're seeing you to take a policy loan. You want to start talking about the family bank. Well, now you go, go to the file folder and you pull it out and like, boom, here's all these loan requests stapled together with a loan commitment and an amortization. These are all policy loans for the family bank. Here's, you know, we. We bought the hot tub. With this, we bought the RV with this, we went on our family vacation with this. And now you have like all this data that you can use to have really cool and powerful conversations that support the financial growth of your whole family.

Yeah. And. And you can actually, to that point, I'm actually using. I don't want to name drop here, but a client of ours, I think it's specifically Sarvalo's client, but you know what I'm referring to. So from that last. Sean. Yeah, that last client coaching session on May 15, you know, we're building a community here. People sometimes they start implementing this process or they hear about it and they go, hey, Richard, how come I've never heard of this before? And they assume that no one's doing this and this is like out of nowhere. They're the first person who's going to get a policy and start accessing loans and banking this way. But we have literally thousands of clients across the country amongst our team who are practicing and implementing the process. Not just the guys over here that tell you that, the guys and gals that tell you that it's a good idea. And this is what I've been able to do. My clients are achieving objectives every day. And so we get together on these client coaching sessions and the team is there to coach and share advanced case studies or different ideas and different ways that you can implement the process and expand your system and so on. But now we're starting to get clients who are totally embracing the concept. And if they weren't already successful in the lane that they are in right now in life, they'd probably be here coaching people to implement it. And we've had clients, come on. Sean did a great job. Like a 25 minute video where he showed how his own policy loan tracker that he created and there was a couple hundred people or 100 people on the call and everybody was like blown away by the way that he manages the system and, and it makes his loan repayments and does it on a very, you know, scheduled, diligent way, including me. So again, being good at following a system, not so great at necessarily creating them. Guess who downloaded that spreadsheet and is now using that policy loan tracker as a, as an excellent tool to make sure that I'm accountable to those money leaks, those expenses that can come up. You know, the AC unit, the Calgary Stampede, the Blake Shelton concert, those are all paid for by policy loans. And it's really easy to trick yourself to think just because I put lump sums of cash in my policies, Here and there. That's really me being. It's kind of like escapism. It's like me, you know, using my Quick start, whatever. It's easy to slam cash into a policy, but am I actually being diligent as a banker? I issued my family a loan to go do that thing. So did I create a loan repayment schedule to be accountable, to make sure that I'm not stealing the P's? I'm putting back more than what I use. So I'm using a specific policy that I, I pulled the maximum loan out to recapture some debt. And now I've got my policy loan tracker and I'm taking those specific payments. I put other cash in other places in my system, but that specific payment, right now it's up to about 4,000 bucks a month. For my loan repayment schedule that I have. I'm putting it specifically in a segmented policy that had $0 to borrow out of it. But now I can actually a. I get to, I like watching it, but now I get to walk my clients through my own tracker and I can show them, hey, I took the policy loan on this date. Can you see that? There was nothing there to borrow? And as of that day, and then now I've put back, you know, $4,200. Well, how much can I borrow? They're like, oh, you can borrow like five grand. Do you see why you want to become your own banker? It's because I'm putting it back into a system I own and I control. And that cash is growing every single day. So I've been pretty excited about that process that I just started to implement here the last couple of months.

Oh, that's fantastic. And that was an amazing presentation. Again, it's, it's available in our client portal for clients of the firm, which is fantastic. And there's many other ones. And there's great, great conversations about family banking. Lots of, We've had certain videos that we've been able to play and then talk through and discuss. And I think a lot of the real value comes from those open discussions that we have. And we also, we try, I mean, it's all technology. I mean, we're not like technology wizards or whatever. So you try to do a breakout room in Zoom. Sometimes it works, sometimes it doesn't. But we try to, we try to get some engagement and community building opportunities in those sessions as well. And I'm excited because I think our next one scheduled around the end is September. September, if I remember correctly. And you know, and then and then we're also planning a big event sometime in October in Edmonton. I don't remember the date offhand, but I believe we got. We're going to be doing a good event for both, for our clients and I think also for the general public, which will be a lot of fun. It'll be good to be together with our team because we all work remotely and virtually and we're scattered, you know, across a lot of the country. And it's nice. We, you know, a lot of us haven't been together in the same room in quite a long time. Part of that's because of geographic distance and then also just because of, you know, the, the whole Covid business. But it's gonna be a lot of fun to be together as a family and as a, as a family, the team oriented aspect, but also as, you know, as the greater IBC kind of family comes together in, in an all in one building, it's just kind of nice to see. So I always love that. That's an area where I get really inspired and enjoy and, you know, hearing your story, how you're implementing Sean's, Sean's tool that he shared with everybody. And my perspective, again, this kind of goes back to the Colby we're talking about earlier is I'm a simplifier, and that's probably too much energy and effort that you're putting in that I would want to do. So I try to keep it even simpler than that. I don't track anywhere near that well. And because of it, I'm not tracking as well. I may not be seeing the same level of gratification or success to the point that you are. But I'm also like, you know what, how much energy do I got to put in to do that tracking? I want to, I want to control my energy inputs a little bit. And so I, I. A lot less tracking in relation to how, how you're doing it. But I think what you're doing is fantastic. And one day maybe I'll get there or maybe I'll just like convince someone else in my family to do it so that I don't have to.

That's another who, not how.

Right? Who, not how.

Yeah, but I, I'll add to that though, Rich, because like I said, you know, you and I are very similar in those, in that way. All I'm really doing, all I did was originally I just said, okay, I'm just gonna start. I'm not gonna, I'm just going to start with one loan. I know that I bought this microphone, that camera, and my tripod when I downloaded the spreadsheet. So thank you, Sean. He did make it available again to our teammates, but also it's available to our clients. They can go on there and they can download the spreadsheet. Super robust and very intuitive. But I downloaded it and I started playing around with it and I just put in one loan. I just said, I'm just going to put in this one loan, and then I put it in there. And then I was like, oh, that was pretty easy. And then I just kind of. Now I have probably 20 loans in there. They're all just there. So now I just got to spend a couple of minutes each month when I go to make the payment to look at what I have to send in, and then I just have to update. Okay, made a payment, made a payment, made a payment type of thing. I say payment number two. My tracker will go from. Let's say it's 12 payments. It'll go from 11 payments down to 10. It'll tell me exactly the balance of the loan that's left there. And I'm totally with you. But yeah, it is, it is. It's just something that I'm slowly kind of integrating. We were talking about atomic habits earlier and. And yeah, it is so far. Like, it actually, it's one of those things. You're probably like this with me too. Like, I might take me a little while to get started sometimes, but when I start seeing or doing something and then I can start seeing the benefit, I kind of get like, kind of hooked. I kind of get it. You know, you kind of get a little addicted to it.

Right.

So now I'm kind of like, you know, I like kind of popping open my policy on tracker and adding things to it and making sure that I'm, well, fulfilling on my commitment that I make. Because now that I'm doing the tracker, my brain won't let me not do it now.

Right. Yeah, that's right. It's. Yeah. Atomic habits that it's all about. And then like, that's one of the things that the book talks about is, you know, the, the thing that it's easier. Something that you really don't like that makes a habit make. Makes you form a habit because you don't want to have this. This bad result continue to happen or it's something that you really like. And so what makes it easier to enforce and do those habits is that there's a reward on the other side. And this, this reward is a very powerful reward because you Log in and you take a look at your, your, your policy portfolio and your loan portfolio. Like, oh, look, look how much loan loans went down and access went up and you know, and then you're looking at, okay, upcoming in the next 90 days, what are some of the, you know, big picture target items I have where I'm going to need access to capital for? So part of that, diligent items, like at the end of the day, we all want to have more success in our financial life. We are all different people. So one of the things that we do teach people is that, look, here's our method, here's our way of doing it. But because your natural way of doing things might be different than somebody else's, you know, some people are more inclined to be a little bit more detailed. They're going to be, you know, excited about messing around with a spreadsheet. Whereas other people, if they're not doing it, you know, in physical paper or whatever, then they can't, and they can't see it. Then they're not going to see the same success. So we try to help coach to what works for you. We're going to give you some, some tools and some ideas and then implementing and recognizing what Nelson taught us. If you get and focus on the primary conceptual level of what's happening. Don't take a policy loan unless you have a, a purpose for the loan and a intention on how you're going to pay it back. You know, when Nelson says don't steal the P's, what he, what he means is you, if you take a loan, put the money back in, put back more than you took up. Okay? And if you put back more than you took out, you're paying yourself, quote unquote, a spread of interest. Great. That fundamentally means there will be more money available for you to work with in your overall financial resources. Because the money that you intentionally paid yourself didn't disappear to some other frivolous crap running through your life. It didn't go to, you know, 45 double doubles last month at Tim Hortons and 14 donuts or whatever that you went and got it. It went to some strategic area of your life. Well, I mean, it's Friday. I mean, it's gonna be a good day for a donut. But you know, that, that little premise is, is a very simple. Like the, the concept of paying yourself first has been around for a very long time. A lot of people talk about you got to pay yourself first, pay yourself first, but people don't really know how to do that it seems so simple, but yet it's so. It's so ambiguous that they're like, they get stuck on what the how is. Well, the how is really simple. You go get a well designed, high cash value, participating insurance policy that builds like a cash machine over your entire lifespan. I don't care who the body is. That's an amazing way to pay yourself because you have a forced payment in your life. There's a premium that must be paid, and then there's a big flexible portion which is optional but highly important. It's is a turbo booster for the insurance, and you get to build and design that with your coach. Then as you get that machine working, now you have capitalization taking place. Now there's things you need to do in life.

Boom.

You have access to a resource of capital that you own and control and can use. And you have habits and skills, coaching, mentorship tools and resources to begin implementing that so that you're improving little bits and pieces along the way. You know, there's a saying about the, the death of a thousand paper cuts. Well, those money leaks that you and Roman talked about, those, those are, that's, that's how we have money disappear out of life. And it has a compound effect over a lifespan. So if we can close those leaks and we can, and we can harness the potential of that money by being focused with our energy and focused with our habits, more financial prosperity comes to you. And that's why we teach people, this isn't about an insurance contract. This is about how you think. Now, someone say, it's all about how you think. It's all about how you think. It's all about how you think. And that's how he would say it. He would begin every presentation, he would do every seminar with that statement.

Yeah, that's so good, Rich. You nailed it. A couple things. The reason why I was pointing to those specific words on there, your own, you know, the key words are your own. So just because maybe Vern or whoever uses this tracker and Richard does it his way. Well, that's because that's Richard bank and that's his family, and that's how he runs his bank. And that's what works with, with him. Right? So every client's banking system and how they operated is going to look as different as their, as their thumbprint. That's the first point that I wanted to make. And the other point was when you were talking about paying yourself first. You know, some people say that, am I really paying myself first if I put my, my Payment quote into some savings account at someone else's bank, really kind of paying them first. So what I want to do is I want to build a system with a contract that has guarantees at a company that I co own where I get to participate in the profit. And every time I drop that premium in there or a loan repayment, I'm truly paying myself first because I'm the one who gets use and control over that money. And it's actually being put to work for me and my family rather than somebody else's. So yeah, it's, you hit some good points there.

There's a, a spot in the book and I'm, I'm just trying to remember where it is. I, I believe it was somewhere near like page 37 or 36 or something. And it, and it talks about, you know, Nelson talks about the, the First national bank of Midland, Texas. I can't remember the exact page right now. It's escaping me. But the whole concept that he walks through is basically the, you know, the whole purpose of putting in the book is to help people understand how do you kill the best business in the world? A bank. The First national bank in Midlands Midland, Texas was the most like profitable bank per capita population base in the United States. You know, for, for quite a while, a long period of time. You know, a lot of oil money and stuff like that. And then the shareholders of the bank, they all got onto the, the, you know, the greed money cycle of everyone's making you know, hundreds of millions of dollars or whatever in the oil business. And there's all these oil projects where they're trying to find oil and discover oil. And so they're, they're now getting involved. Well what they're taking loans out of the bank that they own, the main like shareholders, but they weren't paying the loans back. They were non performing loans, right? And because they weren't paying the loan back, there was no capitalization left in the bank. They had stripped all the money out and they weren't making repayments. And then, and then oil went down and everything kind of, you know, went bad. And so the actions and the habits of the shareholders running that bank caused a major problem that caused that bank to fail. And that you know, thousands of people were out a lot of money, the depositors, everybody had a problem because of the poor habits and poor decision making and the lack of knowledge and understanding of banking in general for the people that own that bank. And so that, that whole story is there to teach us an important lesson. Again we, we Sound like we're kind of, you know, on a wheel here of just a repeat. But it's all about how you think you, the policy owner. The policy owner's behavior is far more important than the behavior of the insurance company in this process.

Yeah, and I know we're running out of time here, Rich, but you're exactly right. Just. Just one quick point about the unseen. You know, about those money leaks. If I spend the money. And, you know, you. You talked about the compounding factor of that, basically working against it because, you know, you spent the money, it's gone. It's no longer working for you. You can't really see that. But to contrast it, what's really cool is going back to my loan tracker. Even if you make lump sums or do whatever it is that you're doing, the cool thing is you actually kind of can see the benefit of when you're paying it back to your system, you're putting back more than what you use. Plus, your cash flow is rising every day. You can actually see. I equate that as, oh, that's me actually recapturing that lost opportunity cost on those dollars when I put 4200 bucks in and there's 4500 there for me to borrow. Where'd that 300 bucks come from? That's just from the way that I think, the way that I structured myself, the way that the policy, the tool that I choose to warehouse my capital in, the way that it works, and it allows me to recapture that. That interest and have more capital available to do more things with for my family. So I just wanted to kind of share that because I just. I'm just super now. You got me all jacked up, man. I can't. I'm going to go do some jumping jacks or something before my next meeting. Otherwise, I'll be talking a thousand miles a minute.

Well, I mean, maybe for me, I probably should be talking a thousand miles a minute. It would get me through my meetings a lot faster, you know, because my meetings always. We were talking earlier how my meetings always go over time, but, you know, we actually have a great question that's come in from Farida, and this is about stock versus mutual company. So I'm just going to tie on that really good, because, you know, she's posted about this question, and so, you know, in Canada, so in Nelson's book, he's talking about working with a mutual insurance company. That is always our goal and our focus and. And the difference between the US And Canada. There are some Differences between our countries, they're not dramatic. On the big scheme of things, they're really minor. But from a, from how the stock companies versus mutual companies work is a bit one of those areas in Canada. We're very well regulated here. And so because of that, stock companies, meaning an insurance company that is stock owned, means you can go and purchase them on a stock exchange. So most of the major large insurance companies in Canada are like that. In fact, during the late 90s and the early 2000s, roughly between like 1999 and 2004, most of the big companies demutualized, meaning they, they had a vote with the participating owners. They, I believe they needed to have a 75% approval vote. 70 or 75% approval. And you know, if you were an owner, you had a participating policy at that time as an owner, you had to sign off basically and agree to vote to demutualize the company. When that happened, it was kind of like the equivalent of the insurance company doing an ipo. All right? They're going public and so they're going to issue stock. And because you were an owner in the company, the only way they could, you could be an owner prior to that was to have participating whole life. So if you already had it, you were, you still had the policy, you still had all your benefits, but now you were issued stock in the new company relevant to the size of your, of, of your, your policy. How, how big of an owner were you? Did you have a million dollar a year premium or did you have a hundred dollar a month premium? Okay. And, and for many people during that period, that was like the closest to like a lottery ticket win. Basically. It was a hugely financial beneficial for a lot of people. Now those companies have done all that. That was, you know, 20, 30 years ago or whatever when that happened. And now, you know, in Canada there's, there's a very few amount of mutual companies that are left. And so we do a lot of our business with one of the largest remaining companies that does that. They're fantastic. I personally own a lot of policies with them. My family. Vern, you do. Most of my policies are with that company. Most of my clients have policies with that company. However, we also do business with other companies and there's many reasons for that. So the stock companies in Canada, I mean, we only have so many choices available. There's only so many companies that have a good quality product that allows for efficient deposits and cash accumulation as well as a reasonably efficient loans process. So there's, there's a, there's checkboxes that we're trying to hit so that we can get the right tool in the hands of the client so they can practice the concept. All right. And so we often have to do business with some of those stock companies. They have great PAR products and their pool is separated. So just like imagine, imagine you have like this giant circle, and this is the company. And then inside of that giant circle is another giant circle, and that's the par count. It's managed and separated, and it's managed in a very specific way. And it's governed on how it's managed. And that PAR account is. It's kind of almost like a business within a business. And so it manages and operates the same way. It pays dividends. When it's profitable. It does all the same things that the contract does now. A small, tiny little sliver of that. When they pay a dividend every year, a tiny sliver can be issued out to the stockholders. It's a pretty small amount. And as that pool grows, the amount of the sliver actually goes down. It's kind of interesting. So it's, it's very well regulated in Canada, whereas in a mutual company, you. It's all one big pool and everything that the company does is kind of in that pool. So all of their, they sell other products. They might, they'll sell term insurance, group benefits, segregated funds, and, you know, a variety, you know, critical illness. All these other types of products, all those products are all kind of mashed together in the, in the financials. At the end of the year, how did we do as a business? We took money in, we paid money out, we had expenses, we had some claims, and, and then we took more money in. So at the end of the year, how did we do as a business? And then this determines what amount can now be issued out for dividends. So you participate what we would refer to on all lines of business when you're in a mutual company, which is, which is really good. And then additionally with the stock company, you only participate now on the par pool. You don't participate on the other products and services anymore. And the other thing. And, and so not to call it problematic, but there's a, some problematic aspect is in a stock situation, stock company, you know, they have stockholders and they have power holders. So they kind of have two masters, right? They gotta appease both of these people. And for, you know, I'm not a stock ninja or whatever, but I understand that every quarter when you are listed on a stock exchange, you have to Report some numbers to those people. And you know, the shareholders, they're hoping for some decent numbers every quarter and they don't. They get really upset when they're not. So there's a lot of activity on the stock company side to try to make sure that they're pumping out good numbers when they get their quarterly report. Right. And so where their focus is versus in the mutual company, a hundred percent of all their focus is on their par owners because they have no other masters. So there's a mindset differential that's there that I think is really important. And ideally we want to abide by what Nelson has indicated is the best process, which is stick with the mutual company. There are many times where that's not the case. In fact, recently I have a lady right now who's doing a, a conversion of existing term insurance and she's doing it with a different company because she was actually not denied but postponed due to some recent medical testing on an application with the mutual company. And because that could take 18 months and the time is going to go by anyway, we can get a really similar, similar features, very similar structure of a policy for her by converting existing term insurance with another company. I have another gentleman I met with two days ago, similar process. He got a policy, he was in better health condition. Now not in as good of health condition. He's added a little bit of extra, you know, extra size since the last time he did it, did an application. And so he would be certainly experiencing a rating on a policy. And so we're actually better off right now. Especially because he's also a smoker in, in converting the other policy with the other company even though it's a company I, I would prefer maybe not to do business with. I. Because let's just. Vern, can I just be honest with you? It's a company that pisses me off.

Okay, I think I know, I think I know which company you might be talking about.

I have a, I have a policy with them and so do you and it's a good policy. I'm, I'm not upset with my policy. I'm upset with the administration of how they administer the policy because they're morons and they don't know what they're doing over there and it causes no end of frustration for a client and for an advisor helping a client. And it's irritating and frustrating and that makes you not want to do business with a company. They're also a stock company. But the policy itself, I'm okay with it. It's it's working well for me.

Yeah. Well, here's the deal, Rich, that I'll say about that. First things first. At the end of the day, the total cash value has to rise to match the total death benefit. Stock mutual, I don't care. The cash value rises every single day. And it can't go backwards. Number two, I have access to, let's just say a general rule. 90% of the total cash value, anytime I ask for it, they're contractually bound to loan it to me. So. So all of those factors still exist. Nelson taught us to do the business with using the best tool that was available to you. So just like Richard's point, hey, I couldn't get the policy at the mutual company. Is that a reason not to get started? I'm super pleased with the seven policies that I own at mutual insurance or at stock companies. I use them all the time. They grow every day and life is good. So that's totally fine. But you did an excellent job of describing that. I love that circle within the circle. I'm going to use that when I draw that for people because I, you know, sometimes help people understand how that works. But you did a great job of explaining all of that. And again, at the end of the day, it just comes down to the process and using whatever tool is available to you as long as it's designed correctly. That's why you got to work with a good coach. But a quick note about term insurance. I drew a line in the sand. I made a decision. I'm never going to cancel term insurance. Well, particularly if it's with a company, whether it's stock or mutual, that offers participating whole life, ideally correctly structured for banking. But I kind of pulled a little fast one. I'm gonna. It's totally on side. It's all good. So, Rich, there is some obviously medical underwriting to get one of these policies, but there can be some financial underwriting, especially if you're applying for kind of a larger. A premium policy or a larger death benefit. The insurance company wants to know that you have a need for the insurance and ability to pay the premium. So that's part of our job as the coach, as the advisor, is to really sell the case to the insurance company and convince them that it's a good idea and a good fit for the client. Right. And so we have to, you know, gather data and have a plan in place and all that. So I did all those same things for myself. So I was able to. And I had to go on a big health Journey and all that. You know, a lot of people know that, you know, 24 months ago or so I was not insurable. So I had to go on my own health journey and get that cleaned up. So I was able to get the mutual insurance company to approve a pretty sizable policy for me in November of 2021. So, pretty new policy. And I disclosed to them that I had a term life insurance policy that I had for many years, about 500,000 at another company, at a stock company. And so as soon as I got the policy approved at the mutual company, I immediately converted my term policy with the other company. So I added another policy to our system. And so it's a contractually guarantee that they have to give me that whole life insurance with no medical or financial underwriting. So I was immediately able to get that policy approved as well. So that was really good. And again, that I'm quite pleased with.

With both so, and I think with that stock company, they made some recent adjustments where the, there was less, even less medical type questions. Because you have the ability to convert into a, into a standard based policy at any time, they can't restrict that. Even if, even if, let's say you've got terminal cancer, you, you can do it. However, there's the, the flexible paid up addition, top up portion that we're trying to do where you want to, you know, maybe get that extra turbo boost into the policy because that purchases extra death benefit. It adds to the risk profile on the insurance pool, so they reserve the right to underwrite for that excess. And, and, but there is, you know, there's certain carriers have a little bit of wiggle room depending on what you're doing. And so I believe in that conversion you had, Vern, there was a recent change where you were able to implement a pretty decent chunk of that in there without really, without any questions at all. Is that right?

Absolutely. So to your point, yeah. And I know this might get a little confusing for people because we're talking a little bit about insurance, but basically, you know, you have a base or a required premium in the policy. It all generates death benefit and it all generates cash value and it's all eligible to receive dividends just in different ways. So I have this base premium that kind of drives the long term and the efficiency, the daily cash growth in the policy that's 100% guaranteed. When you have a term policy, you can convert some or all of that term and that base is guaranteed. With most companies, that's what they guarantee. This particular company that we're referring to, to Richard's point, there's that additional premium that we want to be able to put in because it buys big paid up chunks of death benefit and creates a lot of immediate accessible cash and it helps increase the daily growth and all that stuff. So we want to have that additional option to put that premium in. Most companies won't just give you that additional premium. You have to be underwritten sometimes financially and medically for it. But this particular company recently made a change where they actually will allow you to convert up to, I believe it's about $2 million of term insurance to whole life where they'll actually grant you all of that additional deposit room non medical, non financial. So I was super thrilled about that. So my bas lease premium on that policy, rich, is about $9,000 a year. And now I have the ability to deposit nearly $26,000 per year in the policy. So there's quite a lot of flexibility. So I was pretty, I was pleased as punch as they say. But now that same company, I have to mention this, I love this company actually, so I'm very disappointed about this. For a stock company, they're pretty great. But they made a recent change as well. That doesn't make them very ideal though for most people for banking. Because I have intimate knowledge, I understand the process, I understand the tools, I understand how it works. I'm fine with having the policy. But the problem with this company, Rich, and you know what I'm about to say when I access a policy loan from this company and deploy it and use it somewhere, they've now made it mandatory that you must pay that entire policy loan back before your next policy premium date or at least before you're able to put that additional premium in. So I have to borrow 5,000 bucks, 10,000 bucks, 20,000 bucks. I have to pay that all back and have a zero loan balance on my own policy. Otherwise they'll only let me put the 9,000 in, which really doesn't work very well for most people, especially starting the banking process because you're probably going to have loans paid off, loans paid off, loans paid off, or loan pay a little bit, take another loan, loan pay a little bit, take another loan, Right. So you're kind of always going to have a loan in your banking system because loans are good for banks because it attracts streams of payments. So if you have a loan balance outstanding, you must get it paid back before you can put an additional premium in. And that can pose a lot of challenges for people who are, who are new and don't really understand the whole process. You see what I'm saying, right?

Yeah. And just to quantify that. So thank you for sharing that because this is a new thing and it's for, it's only, I mean, I think we're, I don't even know for a full year around the clock for when this change happened. So for anyone that has an existing policy with that, that company that's, you know, prior to this adjustment, they don't have that issue. And many of my clients have that as well. No issues there, but it's for new ones going forward. So it's kind of like with the insurance realm. One of our colleagues says that there's no, there's no deals in the insurance industry. Everything comes at a cost. And a cost exchange, there's a benefit exchange, cost benefit exchange. And so you're paying a premium to get a death benefit. It's an actuarial premium. It's mathematically calculated. And then the advantage that they said is, okay, hey Vern, you can put a little bit more into this contract than you could a year ago. The same contract. You can put more into it. But because we're allowing you to do that and we're not going to underwrite all that stuff anymore, we have to slowly we have to manage the risk on the pool. There's something that's referred to as anti selection risk. And so if they don't underwrite people for that extra top up that burns talking about, there could be people who are completely medically uninsurable and they're just willy nilly throwing money in and buy a new death benefit. And so if they're also taking policy loans like there, they have to strike a balance so that they can put a, an adjustment in place to manage the overall risk for the pool. So that's how they decided to manage that risk. And it doesn't make it ideal for ibc, however, it also doesn't make it impossible. It simply means the thinking that you have to do must get changed. And there's, there's many ways of still accomplishing the same objective. It's just a matter of having a good conversation with your coach about how to do that. And again, something that's worth doing is worth doing well and worth doing it right. And that company might be the right thing for an individual because perhaps they weren't able to get insured at the other company if they willing to go do a policy with company A, but they weren't able to do that for whatever reason and they already have existing insurance that we can convert at Company B. Company B has some kind of silly knickknack rules that we have to bounce around in and play in their. We got to play in their sandbox.

Yeah.

We just figure out how do we play in that sandbox effectively so you can still accomplish the things you want to do.

Yeah. Really good. Really well said, Rich.

Well, we covered a lot of ground here today, dude.

It was great.

It was not bad. Not bad for going live in, like, in like five seconds from. But, you know, for everyone that's tuned in and for the folks who are watching on YouTube, make sure you continue your journey learning. There should be another set of videos that's going to pop up here shortly, and I bet you one of those is going to be pretty fantastic. It might have my face. It might have burns face or somebody else. Go ahead and click it and watch that next video because you're going to learn a ton of thanks for being with us today and make your day amazing and make your financial life fantastic.

That was awesome.