Whole life insurance serves two separate and distinct functions.
A. During our lifetimes, whole life insurance serves us as a depository and source of borrowed money…our “banks”.
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~ The money we accumulate in a whole life insurance policy is secured by policy guarantees.
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~ Our policy cash values are accessible if we need them because some life event surprised us with expenses we didn’t plan for.
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~ If we become disabled, and added a premium waiver benefit when we bought our policy, the policy will pay for itself. We will continue to have access to the cash values in the policy as if we paid the premiums out of our own pocket.
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~ Our policy cash values quietly and consistently accumulate over our lifetimes – guaranteed.
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~ We can use the cash values in our whole life insurance policies as the source of borrowed funds for purchases large and small.
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~ We can repay the loans we make to ourselves and recapture all of the principal and interest we would otherwise pay a third party lender – all of it.
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~ The money we save by borrowing from ourselves and repaying ourselves enhances the cash values we accumulate in our policies.
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~ The money we accumualte over our lifetimes in a whole life insurance policy becomes an inexhaustable income stream whenever we choose to make that happen…no goverment penalties or employer restrictions.
B. When we die – and, although that is a certain event, it is not a predictable one – those we care about (our named beneficiaries) receive a large sum of totally income tax free cash – money that they can use to help put life back together after our death.
There are many benefits that accrue to individuals and families that use whole life insurance as the foundation of their personal economies; so many that they cannot be summarized in a few hundred words in an article or a blog post. You can discover these benefits and find out how to apply them to your personal economy in Money for Life…in good times and bad – How to Thrive in the 21st Century. The complete e-book is available today at www.TheMoneyForLifeBook.com The paperback should be available sometime in March or early April 2008.
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