10 Mistakes When Buying Life Insurance: Infinite Banking

[@isajthereable]

Quite a few great points made in this! What do you think about about using a few different companies vs just one or two? Your content is very helpful and I sincerely appreciate your time and efforts.

[@TheMoneyAdvantage]

Aj, Help us understand why you are asking? What would you be trying to accomplish by using a few companies instead of one?

[@isajthereable]

@@TheMoneyAdvantage spread load any risk, and access to advantages or features that maybe unique to a company.

[@TheMoneyAdvantage]

Aj, Life insurance companies already do this by splitting/sharing the load with other companies. So you may have a policy with one company, but on the backend the risk is spread across several insurance companies. The main insurance carrier we work with does this more than most other insurance companies. Relatively few life insurance companies have failed over time. As data from the National Organization of Life and Health Insurance Guaranty Associations (NOLHGA) shows, in the 12 years from 2005 - 2017, only 19 life insurance companies have become insolvent. Contrast this with FDIC data demonstrating 523 bank failures over that same period. If a life insurance company were to go under, they are commonly taken over by another life insurance company. This fulfills commitments to policyholders and upholds the integrity of the industry. On top of that, there’s a state Guaranteed Insurance Fund (GIF) that insures the insurance company against insolvency. Its role is to protect policy owners against the worst-case scenario of default, similar to the FDIC insuring bank deposits. Another thing to remember is the insurance companies we work with have been around for over a hundred years, some over 170+ years. The 2 main rules to follow when buying life insurance: 1. Work with a insurance carrier that has strong financials as described here: themoneyadvantage.com/best-life-insurance-companies-privatized-banking/ 2. Find an team that truly understands Infinite Banking and will be there to help you utilize your policy after you buy it. We are unaware of any special features that would be better than what we outlined above. Let us know how we can help you further.

[@Pain-de-Vie-yd9]

Thank you for this

[@TheMoneyAdvantage]

My pleasure! Thank you for watching!

[@thebeezneez1000]

You are changing lives. I sincerely thank you for your time, efforts and knowledge!

[@TheMoneyAdvantage]

I appreciate that! Thank you for watching!

[@HGarach]

Great points!! Thank you!!

[@TheMoneyAdvantage]

Thanks for watching!

[@CG-mb2iu]

I love how you talk and explains so clear.

[@TheMoneyAdvantage]

Thank you for the kind words!

[@dakotadak100]

Fantastic video!

[@TheMoneyAdvantage]

Thank You! Glad you found it valuable!

[@dustinsouza1410]

Your video had so much great information. Thank you so much for sharing it with us! I feel so much better now, sitting down with someone, to go over the whole life with a better understanding of what questions to ask and what to look for. Thank you, Dustin

[@TheMoneyAdvantage]

You are so welcome! Thank you for watching! We also have a free guide here: privatizedbankingsecrets.com/freeguide

[@MartinDezion]

Can it be a mistake or an advantage to have our family LLC buy/own the Infinite WL policies for the key family business partners?

[@TheMoneyAdvantage]

Thank you for asking! This can be a great way to do it, but like everything, it depends on your unique situation and financial picture. For more information on Business Uses of Life insurance: themoneyadvantage.com/key-man-insurance-protecting-your-business-profits-and-livelihood/ themoneyadvantage.com/buy-sell-agreements-life-insurance-exit-strategy/ themoneyadvantage.com/executive-bonus-plan-the-ideal-golden-handcuffs/

[@insuranceknowledge-wj3jp]

Nice video. I am from Nepal

[@TheMoneyAdvantage]

Thanks for watching! It's great to hear from someone all the way in Nepal!

[@frankyavery]

Omg thanks for this video. I watched it like an hour ago. My job offers some life insurance to the PT peeps like myself. I looked at the Comdex and it didnt have a rating. The last day for enrollment was today so I thought I'd give them a call jic to see what's up. Turns out it was universal life insurance and I was like Hmmm that's a no but I asked about it anyway. So she was saying how the rates don't change unless it gets approved by the state, etc. and she said that has never happened. And so I asked how long has the company been around, she says the 1800s. So I repeated everything she said to make sure I got it right and I was like wait the rates HAD to have changed since the 1800s haha. Then she repeated what she said and I heard her inflection on the rates not going up with THIS product. I asked her how long have you had THIS product? She said 2016. I could hear her defeat haha. So yeah, your video was very helpful video thank you.

[@TheMoneyAdvantage]

Thank you for watching! So glad you found it valuable! Here is the blog article related to it: themoneyadvantage.com/10-mistakes-buying-life-insurance/

[@ashleyc7566]

Im 22, around what age should you buy life insurance? I was told I should by both term and whole and cash out whole so you recommended that?.

[@TheMoneyAdvantage]

Thank you for asking. There is no one size fits all answer to that question. We cannot give specific advice on KZbin. Having said, generally speaking, the best time to buy it was years ago.

[@DGarcia007]

What whole life insurance companies do you recommend?

[@TheMoneyAdvantage]

Thank you for watching! First, we have to understand the client's financial picture. Then we can determine what strategies work for someone's unique situation. Only after that can we determine companies and products. We cannot make a recommendation at the product level via a KZbin comment. If you would like to see how this can work for you specifically, you can book a conversation with our team here: themoneyadvantage.com/calendar

[@MartinDezion]

What is the disadvantage or mistake of putting the policy on one's child vs. higher premiums for self due to age 75?

[@TheMoneyAdvantage]

Thanks for watching! This depends on your personal family situation and dynamics. There is no one-size-fits-all approach. here is an episode we did on this topic: themoneyadvantage.com/life-insurance-for-children-or-grandchildren/

[@abdulsalambasit8146]

Can we use velocity banking to fund our private banking policy. Is it recommended

[@TheMoneyAdvantage]

Thank you for asking! The short answer is yes. However, generally speaking, we would not recommend that. Here are a couple of resources we have created on velocity banking: 1) themoneyadvantage.com/velocity-banking-vs-infinite-banking/ 2) themoneyadvantage.com/pay-off-your-house-is-velocity-banking-the-fastest-way/

[@loris.2481]

Very informative and helpful. I waited until my now, early 60s to buy a term life policy. I was approved for a Pacific Life 20 year /100k policy. The rate isn't the best but worth the investment, I think. I'm curious to know if you have recommendations for getting a lower rate, or for getting the premiums to work for me over the next 20 years, or something else.

[@TheMoneyAdvantage]

Thank you for watching! Lori, I cannot advise you without knowing your full financial picture and unique situation. If you would like to book a conversation with our team you can do so here: themoneyadvantage.com/calendar

[@OpinionsUnplug]

This is great information here. However, I disagree that universal life will cost too much to maintain. In particular a properly structured and properly funded IUL will cost less as the cash value increases, because the cash value counts as part of the death benefit. The insurance company will only be responsible for covering the cost of insurance for the difference between the death benefit and the cash value. I agree with everything else you said though…..great video!

[@TheMoneyAdvantage]

Thanks for watching! While we do not use IULs for Infinite Banking, we never said they could not work. However, it is crucial to understand all the risks. We generally prefer the safety and liquidity of our whole life and invest outside of our policies in things that cash flow and that we know and can control. The whole life policy is an emergency/opportunity fund, a place to store cash in between deals. This is a different philosophy than those focused on accumulation only and don't want to be in control. Neither way is wrong. Having said that, our team has and will sell IULs if it makes sense i.e., someone can demonstrate they can and will max fund, they understand the risk, and if the purpose is accumulation, not infinite banking. Here are a couple of resources that I would recommend to anyone considering purchasing an IUL: 1) kzbin.info/www/bejne/rZuWmWqoiNijmq8 2) kzbin.info/www/bejne/b6ucpqmiZ5iMfpY With an IUL, the insurance company only guarantees a gross earnings rate minimum and the death benefit for a period of time. With Whole Life, the cash value is guaranteed to increase every year by a minimum dollar amount, and the policy is guaranteed to endow. Even if you max fund an IUL, never miss a payment or pay late, and pay the extra fee to guarantee the death benefit to a specific age, you still don't have a guaranteed cash value dollar amount. Whether max funded or minimally funded, a whole life policy still has a guaranteed cash value dollar amount (guaranteed to increase by a minimum dollar amount annually) and a guaranteed death benefit to endowment (typically age 100 or 121). Because a UL does not endow, you can only reduce the death benefit to try to preserve the policy. Because Whole Life endows, you can reduce the death benefit amount, so it is GUARANTEED paid-up. Life insurance is not an investment. No matter how you design it, it is still life insurance. In any asset, you can only maximize 1-2 out of the following three things: Safety, Liquidity, and Growth. You have to sacrifice at least 1. IULs sacrifice Safety to get Growth by transferring risk (themoneyadvantage.com/why-you-want-insurance-part-1-transfer-risk/) to the policyholder. * IULs do not have guaranteed premium * IULs do not have guaranteed cash that increases every year all the way to endowment * IULs do not have guaranteed death benefit all the way to endowment * IULs do not endow. Endowment is when the cash value equals the death benefit, and the company pays out the death benefit to the insured Whole life has these guarantees, which is why we use them for Infinite Banking.

[@kmoydaye9866]

You are amazing.

[@TheMoneyAdvantage]

Thank you for the kind words!

[@mrsj5339]

Any companies recommended??

[@TheMoneyAdvantage]

Thank you for watching! First, we have to get clear on financial principles. Then we can determine what strategies work for someone's unique situation. Only after that can we determine companies and products. We cannot make a recommendation at the product level via a KZbin comment. If you would like to see how this can work for you specifically you can book a conversation with our team here: themoneyadvantage.com/calendar

[@mrsj5339]

Understandable

[@abdulsalambasit8146]

Can a family use a single policy to fund collectively in early years for their private banking need

[@TheMoneyAdvantage]

Thank you for watching! Yes you can use a single policy.

[@rw8990]

Whole Life policies get maybe 2-3% return and per thousand is typically the most expensive, the average rate of return of the S&P 500 is about 10%, buy a good 30-35 year term ( cheapest per thousands )when your In your 20s invest in a good mutual fund and and become self insured in twenty to 30 years, theory of decreasing responsibility, oh and there are a few companies that have 35 year terms.

[@TheMoneyAdvantage]

This is not true and we have addressed these topics in multiple episodes and articles. Here are a few that address your points: 1) themoneyadvantage.com/real-rate-of-return-average-is-not-real/ 2) themoneyadvantage.com/the-cost-of-whole-life-insurance/ 3) themoneyadvantage.com/is-infinite-banking-a-scam-dave-ramsey/ 4) themoneyadvantage.com/infinite-banking-objections-answered/

[@robv6794]

Doesn’t the cash value just go back to the insurance??

[@TheMoneyAdvantage]

Thank you for watching! There's a common misconception about whole life insurance that the cash value and death benefit are two separate buckets of money. With whole life insurance, the cash value is a portion of your death benefit. The longer you have the policy, the more of your death benefit is available to you in the form of cash value until all of it is available to you at the end of the policy (usually age 121). Let's say that you are 30 years into your policy and your death benefit is $1,000,000, and your cash value is $500,000. This means that of the total $1M death benefit, $500K is available to you to use. The total here is $1M, not $1.5M. In this case, you could use up to $500,000 while you are still living. Say you chose to do nothing with the cash value, and let it sit in the policy. If you died, your heirs would receive the full $1M death benefit. If you took a loan for $500,000 and died with an outstanding loan balance, the remaining death benefit of $500,000 would be distributed to your beneficiaries. Another way to think about this is that the cash value in whole life insurance is similar to the equity in a house. The cash value is a portion of the death benefit, the same way equity is a portion of the value of your house. Let's say after 30yrs you have paid your mortgage, your house is worth 300K and you decide to sell it. You would not expect to get the value (300K) of the house plus all your mortgage payments back. If the policy is structured properly, while you are living you will be able to access and utilize more cash value than you pay in premium. When you die your beneficiaries will also receive more than you pay in premium.

[@billhall8974]

you'll never satisfy your insurance needs with whole life ins, its simply too expensive. Concern yourself with today's protection needs first , not necessarily something that will occur 40 years down the road. If not cost effective, you will eventually cancel your whole life plan.

[@TheMoneyAdvantage]

Thank you for watching! I would agree that the average person will require some term insurance to get their full human life value. However, I would not say never as we have clients who can and do purchase their human life value with whole life insurance and would buy more if the underwriters would let them. If someone's whole life insurance policy is "not cost-effective" then it is either not designed properly or they were sold a policy that is not suitable for them.

[@jesseguymon2083]

She definitely sells insurance. Only salesmen will encourage whole life insurance. Better to invest your money in your 401k and get term life insurance. Way cheaper that way and way better returns with more control of YOUR money

[@TheMoneyAdvantage]

Thanks for watching! I definitely sell insurance. We sell traditional investments as well as alternative investments. We even help people with their 401k’s. Having said that a properly structured whole life insurance policy will provide more safety and control then a 401k. Additionally it will allow you to earn a return in two places at the same time!