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How do Bank on Yourself® Type Whole Life Insurance LOANS work?
In this episode, we ask:
- What is a life insurance policy loan?
- If I’m trying to be debt free, why go back into debt with an insurance company?
- Are life insurance loans just like a credit card or a mortgage?
- Isn’t a life insurance loan just like a personal loan?
- How does your cash value collateral continuing growing, even when you have a policy loan outstanding?
- How is this different from a HELOC?
- Is your house guaranteed to go up in value?
- What about contractual guarantees with a life insurance policy loan?
- What are the limits with a life insurance policy loan?
- Could the loans lapse the policy?
- What is the best kind of investment to a life insurance company?
- Can you be “underwater” in your life insurance policy loan?
- What are the requirements for this type of life insurance policy to work in a Bank on Yourself design?
- Is it whole life insurance?
- Is it a non-direct recognition loan?
- Is it flexible, so you keep it for your entire life?
- Are you repaying your loans?
- Are you working with a knowledgeable, authorized advisor?
- Do you have trauma from a previous bad experience?
- Why do so many advisors not know how to design these properly?
- Does your existing whole life insurance policy penalize you when you take policy loans?
- Does your advisor know what they’re doing? Do they frantically google in front of you?
- Why did the Titanic sink?
- Do you know an advisor who has a skillful knowledge of Life Insurance contracts?
- Of what red flags should you be aware?
- With non-direct recognition policy loan, how is the dividend credited on a whole life policy?
- If you don’t have a non-direct recognition policy loan, what happens?
- When you take a policy loan, where does the money come from?
- See The Bank On Yourself Revolution by Pamela Yellen, page 256
- What is the collateral for that loan?
- When do life insurance companies get a profit?
- How do you benefit from the interest you paid on the loan?
- If the insurance company’s yield is better than their worst case scenario, what happens to your dividends?
- Who’s allergic to paying interest?
- What are some financing strategies when buying a car?
- What interest does an insurance company charge on the loan?
- Who are the owners of the insurance company?
- Do you love that you are charged loan interest?
- What is simple interest, compounded annually in arrears?
- When is 5% not always 5%?
- Why would you willingly pay extra for something?
- What type of interest would you like on a savings account? Simple? Compound?
- How can you calculate the growth you receive?
- Is the method of banking on yourself better or worse than paying cash for things?
- Don’t you wish more people knew about this?
- How can you make a profit on buying a car?
- How can you use a life insurance policy with non-direct recognition policy loans for income in retirement?
- What’s the problem with the direct recognition policy loan design for income in retirement?
- What design features have a tremendous amount of impact on how long money will last in retirement?
- How do banks use money in more ways than one (at the same time)?
- What does the fine print in your contract say?
- “Ignore what banks tell you to do with money, and instead, watch what they do with their own money.” – John McCarthy
- How much money do banks keep in life insurance contracts?
- What’s a tier 1 asset?
- How can you change your family tree?
