Buy, Borrow & Die

Hear the strategy anyone can use to begin successfully investing while paying less taxes. Ed McCaffery, a tax law professor at USC, joins Tom and together they discuss the strategy of “Buy, Borrow & Die.” Find out how you can apply this basic formula to build wealth and eliminate taxes.
03:36 - How Do Taxes Differ For Wage Earners Versus Asset Owners?
05:17 - What Is “Buy, Borrow & Die?”
16:11 - How Does The New Tax Code Affect Estate Taxes?
25:18 - Why Does Real Estate Investing Work So Well In “Buy, Borrow & Die”?
EPISODE BONUS: For the transcript, show notes and more visit: wealthability....
Learn more about Ed McCaffery and The Peoples Tax Page by visiting peoplestaxpage....
Tom Wheelwright, CPA is a Best Selling Author, Entrepreneur & Worldwide Authority on Tax.
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DISCLAIMER: WealthAbility® does not provide tax, legal or accounting advice. The materials provided have been prepared for informational purposes only, and are not intended to provide tax, legal or accounting advice. The materials may or may not reflect the most current legislative or regulatory requirements or the requirements of specific industries or of states. These materials are not tax advice and are not intended or written to be used, and cannot be used, for purposes of avoiding tax penalties that may be imposed on any taxpayer. Readers should consult their own tax, legal and accounting advisors before applying the laws to their particular situations or engaging in any transaction.

[@izakmizrahi8569]

This professor really doesn't want to be interrupted ahahah

[@marilynd677]

Great video but let him finish his thought.

[@rodricutz737]

Foreals the interruption made me cringe so much🤦🏻‍♂️

[@zackcash4941]

Hey hey ed hey hey

[@speeddoctor]

He is so long winded, I have a feeling he is trying to show Tom that he knows more LOL.

[@christopheranastasio6569]

Tom - great episode! I'm obsessed with this BBD concept. Some questions I was hoping you could address at some point: how does the borrow part actually work in practice? How long does the person borrow for? What length or terms do they seek for the loan? Interest-only or some other type of loan? Why do the banks feel comfortable loaning out so much money, knowing that the asset's appreciation isn't necessarily guaranteed?

[@CallGojo]

My guess is that after you take out the original loan, you can take another loan out that pays off that loan and covers your living expenses. You do this till you die. I’m assuming you can keep doing this as long as your LTV ratio is low enough. Should be fine if you have a ton of money already and/or your returns are greater than the interest rate. When you die, your family doesn’t have to pay taxes on the current price of the assets. So they can sell some of it to pay off the loans and then use the rest. This is what I’m guessing and makes sense to me.

[@Chris-ln3xe]

They mainly buy Real estate assets which historically always go up so banks are comfortable with loaning with these as collateral

[@nathanmutchler2490]

Is it me or is this more relevant now than it was a year ago? Lol. Thanks Elon

[@oceanwonders]

The call quality made it difficult for this guest to hear Tom trying to jump in... I will give him the benefit of the doubt.

[@QB5022]

When do you pay back the money you borrow?

[@nellythompson]

When you die. Tax free from your assets

[@paulcervenka]

I was confused by this as well, I always thought of borrowing money as being a loan with monthly payments. I still have to get a grasp on it but ya it basically seems like its that simple. Borrow the money and then die lol

[@Crisis-xw3wg]

@@paulcervenka 😂😂😂

[@jameskim4185]

Can you use this method in South Korea?

[@naanncurrysunset7364]

How you get loan on income property?

[@austinstambene3087]

You can borrow against your assets

[@benji_bugatti8731]

I haven't watched the video yet but believe it's the "refi till you die" method. Cant get taxed on a loan. Or it's a 1031.

[@nathanmutchler2490]

@@benji_bugatti8731 its the former

[@naanncurrysunset7364]

You do t show income ... you do t get loan ....

[@paulcervenka]

When you borrow against an asset you don't really have to show proof of income or a credit score because the loan is secured by your asset as collateral. That's how I understand it. And everyone, especially loan institutions are very happy to lend money in return for an asset. If I say that I have a brand new Xbox and I want to borrow $200 dollars from you and if I don't pay back the $200 then you can keep my Xbox, you're probably more comfortable doing that. Anyone, correct me if I'm wrong but does that make sense?

[@claybob]

Very patriotic to extract wealth from the American economy without contributing.

[@claybob]

@@stlstrkaudio5764 you mentioned a bunch of things you think they are contributing to but didn’t say how they are contributing. The buy borrow die crowd is not contributing any income tax to the system because they aren’t paying any income tax.

[@nobodymister5435]

They create housing, housing gives people a roof over their heads and most certainly it contributes to creating jobs- because those properties need to be managed.

[@Crisis-xw3wg]

@@claybob you are a just jelly Wage slave stuck in the matrix 😂😂😂

[@freedomseeker1966]

Patriotism has nothing to do w it. They contribute by taking investment risk and providing housing.

[@robertg1556]

Wheelwright needs to let his guest finish his sentences. Jeez.

[@screenwatcher6224]

This guy was AWFUL. He just kept talking and talking. Great content though.

[@YentaY0]

If you can watch this - and listen to it --- and if the utter selfishness doesn't strike you as 'immoral'... then there is something wrong with you. These people -- one teaches at USC??? They are saying it's ok to stick the wage earner and the small business owner - with all the tax burden... they are saying it's ok to do that --- Not only that -- they are encouraging it. No morals. No ethics. Just unadulterated greed.

[@zackcash4941]

Bruh the worker is gonna be stuck with the tax burden whether you do this or not. Taking advantage of the broken system isn't a political statement.

[@Michaeldpress14]

All taxes are greedy , fuck you and fuck the government

[@paulcervenka]

The whole point of this isn't to say yay us we don't pay taxes and workers can suck it. This is teaching people how to play the game. Everyone should do this if they can. Taxes are dumb, the government is marvelously bad with our money so I think ANYONE who pays taxes is paying more than their fair share. This isn't illegal or immoral its just information that does nothing but benefit those who use it which can be you and me.

[@stlstrkaudio5764]

Is utilizing deductions that the government is offering you immoral? Wouldn't the government that created the tax breaks be the evil one, not the people taking advantage of them..?

[@Putseller100]

The wage earner can do this as easily as the elite. Buy stocks in an M1 finance account and use their borrow feature at 2% interest, it is a portfolio line of credit. You can begin with as little as 10,000 dollars