Why You Want to Be Your Own Bank?

I always want to be the “bank”…not in Monopoly… in real life.

Why?

You know how everyone thinks banks are safe places to park their savings?

That’s exactly what the banks want you to think. So you’ll put your life savings with them.

What’s your interest rate in your bank savings account?

Inflation is 3.3% each year…are you making or losing money in savings account?

 

 

The bank borrow money for almost free and lend YOUR MONEY out at 5%, 7%, 10% interest.

Related article: Is Your Money in Your Savings Account Working Hard for You? Or for the Bank?

 

How Be Your Own Bank Works

The cash value life insurance is a little known secret tool for wealth building and investing.

If is actually 2 products in one vehicle – life insurance and a savings account.

The difference between this “savings account” and your bank’s savings account is that the “cash value” savings account grows tax-free and is distributed to your beneficiary as tax-free death benefit.

Let me clarify this a little. Every cash value life insurance policy is different. Most charge interest rate for borrowing…some charge more and some charges less.

The Transamerica Financial Freedom Indexed Universal Life Insurance that I own and represent, charges a net interest rate of 0.75% for first 1-9 years, then 0% after 10 years.

Also a very important point to remember is when you borrow money from your cash value, you are not taking money out from your cash savings account, you’re borrowing money against your cash savings account, which is being used as a collateral for your loan. This is an added bonus, because your cash savings account continues to grow money tax-free while you’re enjoying your extra cash interest-free.

Another bonus with borrowing from a cash value life insurance is that you don’t have to repay your loan it you don’t want to.

How? Good questions!

Remember it is a life insurance policy. So it also has a face value. When you die, the insurance company will pay off your loan from the proceed of the death benefit.

If this is the first time you’ve heard of this life insurance feature, don’t be alarmed. Life insurance has come a long way just like mobile phone has evolved into smart phones.

Related article: Do You Have the Best Life Insurance?

Consolidate high interest debts

Long term care

Critical or terminal illnesses

Invest in real estate

Pay for college tuition

Pay for private school tuition

Start a business (like Walt Disney)

Supplement retirement income

S.M.A.R.T. Retirement Planning

You CANNOT get a loan for retirement…

You CAN get a loan to pay for a vacation, a new car, a new home, college tuition, private school tuition, plastic surgery…but you CANNOT borrow for retirement. So don’t delay!!!

The 3-Legged Stool of Retirement

Pension

Fewer companies are offering retirement benefits these days – and for those that do, many are scaling back their plans. Will your pension be enough?

Social Security

It started out with 40 workers contributing for one retiree in 1940’s, now it’s 3 for one. Do you think there’s still Social Security when you retire?

Personal Savings

38 millions Americans live paycheck to paycheck. And only 59% of adults says they have savings. Do you have enough savings?

<center>maximize retirement savings and tax benefits, and create an endless stream of retirement income. </center>

VIP Insider Guest List

Be the first to be notified of events, workshops and promotions directly to your email.

Tax now

TAX NOW

Brokerage account

Certificate of deposit

Checking account

Savings Account

 

Tax later

TAX LATER

401k/403(b)

Annuity

SEP IRA

Thrift Savings Plan (TSP)

Traditional IRA

Tax never

TAX NEVER

Life Insurance

Health Savings Account

ROTH IRA

ROTH TSP

Related article: Tax-free Retirement

<center>The rule of thumb is you’ll need twenty (20) times of your current annual income for a comfortable retirement.</center>

Long Term Care Insurance

Estate Planning

Final Expenses

Are you also saving for college?

Can You Afford Long Term Care?

Will you need long term care?

Most of you would answer “I don’t know”.

I don’t know either.

If I have a crystal ball that can tell the future, I would give you my honest answer.

Unfortunately, I don’t.

But my best advice for you is “be prepared when the need for long term care does arise in your future”.

And here’s the statistics...

Long Term Care Need

Let’s see what options are available.

Medicare covers only a portion of long-term care costs up to 100 days; 20 days are provided at no cost and the remaining 80 are at a significant co-pay for the insured.

Long-term disability covers your lost income only, but doesn't pay for any LTC needs. Oftentimes, when your job ends, so does your coverage.

Health insurance does not cover long-term care expenses. Medigap policies are health insurance and also do not cover LTC expenses.

Medicaid covers long-term care expenses for individuals with countable assets of $2,000 or less and care could be limited to a nursing home. You can no longer just transfer all your properties to your children to be qualified for Medicaid. They look at your assets in the past 5 years. If you sold a house in the last 5 years, they want you to spend down all that proceed until you’re poor enough to qualify.

If you don’t want to spend down all your asset to qualify for long term care…can you afford to pay out of pocket?

Is this a good option for you?

You can always pay for long term care out of pocket. But how deep is your pocket? Do you have the assets to pay for long-term care, and how long can that asset support your long-term care?

Rising Long Term Care Cost

Can your family members take care of you when you can’t take care of yourself?

Even the most responsible family may not be prepared physically, emotionally or financially to care for their loved one. 53% of Americans caring for a loved one lost income due to the demands of providing that care.

Hidden Cost of Long-Term Care

Long-term care insurance provides funding to cover home healthcare, assisted living, nursing home and even family member who takes care of you.

Long term care insurance premium are a lot more affordable than long term care. Besides, stand-alone long term care insurance policy, many life insurance policies offer long-term care insurance as a rider at very affordable rate.

So, can you afford NOT to have long term care insurance?