Time Stamps 00:00 Start 00:19 Goals for the Webinar 01:11 What are life insurance policy loans? 03:16 Barry's insights into policy loans 08:28 Cash value life insurance 09:31 Why we focus on whole life insurance for infinite banking 11:06 The Pros of life insurance loans 11:49 Visual illustration of a policy loan 14:25 Back to The Pros of life insurance loans 16:50 The Cons of life insurance loans 17:30 Be an "Honest Banker" 19:48 Ideas on what to use life insurance loans for 22:30 Life insurance loans tax advantages
What is advantage of increasing higher interest on the policy loan vs funding more cash with PUA to increase your cash value? Assuming both cases do not trigger a MEC.
Thanks for your question. If I understand you correctly, you’re asking if those are the same thing and that’s true in that in both cases you’re adding extra cash within MEC limits.
so what does cash value equate? For instance if I wanted to do a 2 million dollar life insurance, would there have to be 2m in there or?, how does that work? like for the loan/ how long would it have to be in there to be able to get a loan/ line of credit. hope this makes sense
You would need to see an illustration to see the guaranteed cash value. This would vary based upon your policy design, base premium target, term blend, and paid up additions. As a first step you can connect with our expert Barry Brooksby by emailing barry@insuranceandestates.com.
So are you only aloud to borrow whatever cash value you have accumulated? or are you able to borrow towards whatever the policy is worth? I have a policy for $100,000 but I only have accumulated 5thousand in cash value, could you help me to understand?
You have a traditional whole life policy and not a high cash value design according to those facts. So you likely can only borrow $5000. This is a different animal entirely from a policy designed to maximize cash value.
Where can I find the best company/product that has immediate cash value which can be taken out as a policy loan within the first year? Ive been doing a lot of research but usually they don't state much details.
Hello and thanks for checking in. I recommend that you connect with our IBC expert Barry Brooksby. We deal with many companies and he can recommend the best one to suit your goals. Just request a meeting with Barry by emailing him at barry@insuramceandestates.com. Best. Steve
@@Farmergallo Not on which company/product has that option but I've done more research and found that it can be setup as long as you have an agent who actually knows how and is willing to!
@@josecolon788 I did. he was able to break it down and help me understand more for what I'm trying to achieve. long story short, there aren't any policies one can get that can be used for any immediate investments unless you have $$$ upfront to fund the policy then borrow back. however it's great to have for use on future projects/imvestments
A withdrawal and a loan are two different ways to access your cash value. As long they take a loan and the policy is not a MEC and the client keeps the policy in force until passing, there will be no tax on policy loans.
I really need help with this.. I mean Life Insurance policy get a Loan on my own policy but don't want it to be taxed. Use my policy loan and pay back the interest?? There is a strategy here?
Hello, the strategy is this: whenever you use cash there is a cost of capital either due to interest or lost opportunity. When you use cash you take it out of circulation rendering it unproductive. Banks NEVER lend their own cash for this basic reason (at the risk of oversimplification). When you use a policy loan to do something productive (hopefully) you are acting like a bank because the cash in your policy keeps working. This is leveraging like a bank. This is counterintuitive vs the way that most people think about money. The banks know it well, paying interest and loaning out money many times over what is held in deposits. This is called the fractional reserve system. Think like a bank and stay the course.
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Time Stamps
00:00 Start
00:19 Goals for the Webinar
01:11 What are life insurance policy loans?
03:16 Barry's insights into policy loans
08:28 Cash value life insurance
09:31 Why we focus on whole life insurance for infinite banking
11:06 The Pros of life insurance loans
11:49 Visual illustration of a policy loan
14:25 Back to The Pros of life insurance loans
16:50 The Cons of life insurance loans
17:30 Be an "Honest Banker"
19:48 Ideas on what to use life insurance loans for
22:30 Life insurance loans tax advantages
What is advantage of increasing higher interest on the policy loan vs funding more cash with PUA to increase your cash value? Assuming both cases do not trigger a MEC.
Thanks for your question. If I understand you correctly, you’re asking if those are the same thing and that’s true in that in both cases you’re adding extra cash within MEC limits.
so what does cash value equate? For instance if I wanted to do a 2 million dollar life insurance, would there have to be 2m in there or?, how does that work? like for the loan/ how long would it have to be in there to be able to get a loan/ line of credit. hope this makes sense
You would need to see an illustration to see the guaranteed cash value. This would vary based upon your policy design, base premium target, term blend, and paid up additions. As a first step you can connect with our expert Barry Brooksby by emailing barry@insuranceandestates.com.
So are you only aloud to borrow whatever cash value you have accumulated? or are you able to borrow towards whatever the policy is worth? I have a policy for $100,000 but I only have accumulated 5thousand in cash value, could you help me to understand?
You have a traditional whole life policy and not a high cash value design according to those facts. So you likely can only borrow $5000. This is a different animal entirely from a policy designed to maximize cash value.
Where can I find the best company/product that has immediate cash value which can be taken out as a policy loan within the first year? Ive been doing a lot of research but usually they don't state much details.
Hello and thanks for checking in. I recommend that you connect with our IBC expert Barry Brooksby. We deal with many companies and he can recommend the best one to suit your goals. Just request a meeting with Barry by emailing him at barry@insuramceandestates.com. Best. Steve
Any luck finding out ?
@@Farmergallo Not on which company/product has that option but I've done more research and found that it can be setup as long as you have an agent who actually knows how and is willing to!
@@ciasiaj-m6774 how has it been going for you. did you connect with this videos expert barry
@@josecolon788 I did. he was able to break it down and help me understand more for what I'm trying to achieve. long story short, there aren't any policies one can get that can be used for any immediate investments unless you have $$$ upfront to fund the policy then borrow back. however it's great to have for use on future projects/imvestments
LIRP withdraws are loans and tax free up basis put in, after that taxed as ordinary income.
A withdrawal and a loan are two different ways to access your cash value. As long they take a loan and the policy is not a MEC and the client keeps the policy in force until passing, there will be no tax on policy loans.
I really need help with this.. I mean Life Insurance policy get a Loan on my own policy but don't want it to be taxed. Use my policy loan and pay back the interest?? There is a strategy here?
Hello, the strategy is this: whenever you use cash there is a cost of capital either due to interest or lost opportunity. When you use cash you take it out of circulation rendering it unproductive. Banks NEVER lend their own cash for this basic reason (at the risk of oversimplification). When you use a policy loan to do something productive (hopefully) you are acting like a bank because the cash in your policy keeps working. This is leveraging like a bank. This is counterintuitive vs the way that most people think about money. The banks know it well, paying interest and loaning out money many times over what is held in deposits. This is called the fractional reserve system. Think like a bank and stay the course.
@@InsuranceandEstates Good stuff.. Do you have a service or contact num# info