Reason number one why you and any money smart person should choose to build a Money for Life economy that lets YouBeTheBank and that lasts in good times and bad:
You can get to the money in your “bank” whenever you want it or need it…no penalties, no waiting, no taxes.
Most financial products are designed by Behemoths that want to build their own portfolio of “money under management”. Their reasons are easy to understand. The Behemoth’s want to hoard as much money as possible in their coffers. That way they can earn commissions on transactions, charge fees and hang onto profits in excess of the expected returns. Because of this, the products they sell tend to place significant restraints on your ability to access your own money without incurring penalties or waiting for some arbitrary date to arrive.
In addition, some financial products either are or can be incorporated into “qualified” plans. That usually means you can take a tax deduction when you put money into the plan. It also means that you can’t get your money out of the plan without paying huge penalties and taxes.
Everyone experiences events in life that demand immediate access to money. For many, the money they have in qualified plans is the only money available when stuff happens. The result: penalties, taxes and starting all over again.
There is a better way. Money you hold in a participating cash value life insurance contract – your “bank” – is easily accessible. It usually takes only a phone call to the insurance company to get a check written and in the mail; no penalties, no waiting, no taxes. There are not normally any fees associated with the transaction. And, you can usually replace the money you take out without penalty.
Here’s an example that happened to me. My daughter turned 16 (guess where this is going) and got her driver’s license. A few months later she was allowed to drive my brand new Oldsmobile to school for the first time. A ditch, two fences and a concrete bird-bath later I was staring at over $7,000.00 damage, a $2,500.00 deductible and a $123.00 per month insurance premium increase. Thank goodness I had cash value life insurance where I could borrow the money quickly to solve that part of the problem. Thank goodness I had a good daughter who took responsibility for her part and worked hard to repay it.
Tags: bank on yourself, circle of wealth, debt, debt to others, financial, financial advice, financial planning, infinite banking, insurance dividends, investing, life insurance, Money, money for life, money under management, mutual insurance, mutual insurance company, passive income, saving, stock dividends, Taxes, term life insurance, universal life insurance, variable life insurance, Whole Life Insurance
