Valuable Finance Insights from Tier 1 Capital

According to Intuit, 61% of business owners around the world experience either cyclical or chronic cash flow issues. What we’re going to talk about today is how to use the infinite banking concept to put you back in control of your finance payments, even when you have these cyclical or chronic cash flow issues.

When it comes to owning a business, a lot of times people go into building a small business because they want to be in control of their destiny. They don’t necessarily want to answer to anyone, right? And they think that they could profit more on their own than working under someone else.

And everything goes smoothly until they have to get a loan for their business. And then the bank comes in and makes them sign two times once for the business and once personally that personal guarantee. And it’s at that point, at that exact point, that they realize, oh, I’m not in control.

Because the bank is now controlling the finance function in your life. And here’s the deal. They’re not just controlling the finance function; they’re controlling the cash flow. And that’s why Intuit, when they did their study, realized that 61% of business owners around the world are literally suffering from chronic and cyclical cash flow issues. Why? Because the business owner is not in control of the financing function. I bet that closely correlates to the other study that said 68% of business owners either sleep less or lose sleep over cash flow because of that cash flow issue and the stress that’s caused by it.

Because now they owe the bank. When you get a loan, you get a coupon booklet. Or if you get a credit line, you’ve got to pay the interest every month. And so you’re obligated to make those payments. That brings us to the subject of our blogpost today, which is unstructured loan payments.

When it comes to the infinite banking concept, one of the best features I feel there is, is number one: guaranteed access to the cash value. As long as there’s cash value built up in your policy, you have access to it. And number two: when you take a policy loan, it’s an unstructured loan. Right? So you tell the insurance company, “Okay, insurance company, send me X amount of money.” And they say, “Okay, where do you want me to send it? I could send you a check to your house, or I could put it in your bank account. No big deal.” But the key here is there’s no coupon booklet. You get to pay that loan back as quickly or as slowly as you see fit. We do recommend you pay back at least the loan interest on an annual basis, but other than that, it could fit into your cash flow.

So it’s recommended that you treat your money just as you would treat the bank’s money and have those intentions. So maybe that looks like setting up a loan for 10 years and paying 10% interest back to the loan. Okay? But let’s say five years down the line, cash flow changes. Maybe you’re expanding your business, and so cash flow is tight for the time being. You’re able to cut back if you wanted to reduce those payments or stop the payments for a period of time with no penalty. Right? The only thing you have to consider is the loan interest being charged on that loan.

But the key is because the loan is unstructured, you have the option to fit the monthly payment if you choose to have a monthly payment into your cash flow, rather than the bank dictating what your monthly payment is going to be. That’s number one. But number two is you also have the option of not paying, of paying interest only, of paying it back in a short window let’s say a two- or three-year period or a longer window at, let’s say, a seven- or ten-year period. The key is that it’s your choice, and that’s the value of an unstructured payment fitting those payments into your cash flow rather than making your cash flow fit into the payment.

This is a huge deal, right? Because think about it: if you own a business and you have cyclical cash flow issues let’s say you are a shed business owner, and people buy sheds in the summer mostly, right? That means all of your cash flow is coming in those summer months. But during the winter months, it’s not so cash-flush. So maybe you make higher payments during the summer months when you have that cash flow and then you cut back during the winter months. But the key here really is once you make those payments back to the policy, you have access to that money again, right? So it’s not like you’re making these payments and they’re going to the bank and then you’re never going to see them again unless you qualify for that money. Again, with the life insurance policy loan, you’re rebuilding your pool of cash that you have full liquidity, use, and control over, that you’re able to access again if and when you want to.

And again, that’s not a small distinction. You get to access the money that you’ve already used to pay down the loan, and you get to use it again no questions asked. You know, when you go to a bank, you’re asking permission and seeking approval. When you get a loan with an insurance company, you are giving an order. That’s not a small distinction.

Another thing to consider is that all along the way, you are paying your premiums, right? Whether it’s on an annual, monthly, quarterly, or semi-annual basis. So when you pay back your policy loan, plus you’re paying the interest, again, you’re building that pool of cash. So you’re able to finance larger and larger purchases as time goes on, and that policy becomes more efficient.

And not only does it become more efficient, but now your cash flow becomes more effective. And that’s the key. You’re now in greater control. And the control issue we’ve talked about it a lot in this blogpost but the control issue is paramount. That’s why business owners went into business: to be in control. But now, when you control the financing function in your business life, now you’re in complete control.

Well, I think another factor that needs to be placed in this and emphasized is the death benefit, right? Because now, in either situation whether you have a policy or not you’re making that purchase. There is the debt, right? Whether we’re financing from a bank or we’re financing from the policy. But when you have that policy, now you have a death benefit associated with that. So whether that’s your family or your business owner who’s going to come into the business after, they don’t necessarily have to worry about coming up with the money to pay off that loan. They don’t have to worry about liquidating assets or selling the business. They have a death benefit that’s going to be reduced dollar for dollar for any outstanding loan. Plus there’s going to be death benefit associated with it. So exactly when they need money, they’re going to have it. So they’re not forced into those hard decisions of selling off assets and selling the business.

And that’s a great point because literally built into their financing mechanism is a mechanism to extinguish the debt at their death. That’s an awesome feature. Would you rather a death benefit or a personal guarantee, right? Because if you have a personal guarantee—Well, now you put it that way, I guess I’ll take the death benefit. If you have a personal guarantee, doesn’t that mean your estate’s responsible for paying back that loan? And that’s a lot of pressure for the executor of the estate, right?As if there wasn’t enough pressure.

If you’d like to learn more about how to implement the infinite banking concept and these policy loans into your plan, visit our website www.tier1capital.com and click the “Schedule Your Free Strategy Session” today. We’d be happy to chat with you about your specific situation and how we could put this to work for you to make your cash and your cash flow as efficient as possible.

Remember: It’s not how much money you make, it’s how much money you keep that really matters.

When it comes to thinking about investing, people not only have to consider the risk of their money but also the risk of time. How much time do you need to be invested in order to earn a reasonable rate of return? And is that time commitment worth the risk associated with the investment? That’s what we’re going to talk about today, the importance of thinking long term when it comes to your finances.

When it comes to thinking about money, saving, investing, it’s important to think about timeframes, right? And think about what to expect over a certain amount of time. There’s an old Chinese proverb: “The best time to plant a tree was 20 years ago. The second-best time is today.” That really outlines that you can’t go backwards, but you can make decisions today that will set you up for success going forward.

And you know, when Nelson Nash wrote his bestselling book Becoming Your Own Banker, he had the human factor. And one of them was thinking long term. I’ve got to tell you, Nelson Nash was trained as a forester, and they think 70 years in advance. Like Nelson would say, “I’m probably not going to be here, but somebody is going to benefit from my long-term thinking.” That gets me thinking about infinite banking because it is definitely the long game, right? You’re going to finance things over the entirety of your life. And just think about the amount of interest you’re going to pay if you’re borrowing, or the interest you’re giving up if you’re paying cash. That’s going to be a huge pile of money, and somebody could recapture that interest. You’re either going to pay up or give up through the death benefit of the policy you set up to finance all of those things that you’re buying over your lifetime. That got me thinking that we live in a society where we want instant gratification. And infinite banking is the long game. You have to think long term.

Exactly. And I think a key component of that is starting now and starting where you’re comfortable, right? Whatever your cash flow will allow you to save comfortably on a monthly or annual basis, start with that, and you can always build from there. As circumstances change, as your job changes, as you earn more money, maybe you start a business, maybe as we clean up your debt, your cash flow becomes more efficient. And especially as you see how this process works and how it could impact your life going forward, you’re going to want to put in as much money as possible into this extremely efficient way of saving for the future, saving for every single purchase that you make in your life. You could purchase through the life insurance policy loans with no questions asked. And that’s freedom. And not only those purchases, but also take advantage of opportunities, especially as that cash value grows and your banking system grows.

But these are just ancillary benefits of thinking long term. Right? You have access to money, you have tax benefits, you have the ability to recall the flow that was previously going away from you. Now that flow of cash is coming back to you. All of this emanates from the initial decision to think long term. And thinking long term is never a bad thing.

Your future self is going to thank you for the decisions that you’re making today, right? You want to put yourself in a position in the future where you have this pool of money. And with that pool of money, it’s not just any pool of money it’s sheltered from taxes, it’s sheltered from creditors, and it’s accessible all along the way. Because you know, you need to be saving. Ideally, the magic number is 20%, but maybe you start at 5% or 10% and you build from there. And as you do that on a consistent basis and build up that compound interest curve, money and time, you’re going to have access to more and more money and have access to more and more opportunities as time goes on. And that’s really the key of thinking long term starting now and setting yourself up for the most options in the future.

That’s a good point, right? Your future self will be thanking you for the decisions you made today. Now, there are a lot of things my future self needs to talk to like the guy who was a teenager and a lot of those stupid decisions that we made. But I’ve got to tell you, there are certain decisions that I did make thinking long term that have actually paid off. Those instant gratification decisions I’d like a couple do-overs on those.

We don’t necessarily know the outcome when we’re making those decisions, but I can tell you with the life insurance policy, we have little to no risk, right? We have guarantees by the insurance company with this life insurance contract associated with it. We have guaranteed access. We have tax benefits. Like I said, we have the creditor protection not to mention the death benefit that’s going to go on to our family, named beneficiary, or business at the time of our death to recapture the finance costs for our entire life, right? So think about that pool of money that we talked about earlier of all the interest paid and all the interest you didn’t earn. Think about getting that huge pile of money back and passing it on and leaving that legacy behind. That’s really the key, right? The family banking system. How do we set this up for generational success, right? And it comes down to having multiple generations involved in the banking system. And as you build up those pools of money, actually using it, right? Putting it to work. You have access to that money. Yeah. Why not use it so that everyone can finance their purchases through this banking system? And then as windfalls come in, i.e., death benefit, we’re able to roll it into more policies because the family knows how to put this process to work for them.

Here’s the thing this is the key, right? Thinking long term. You can’t think intergenerationally without thinking long term. So it goes hand in hand. And this concept has generational wealth built into it. Exactly that. I mean, it is such a tight system. It’s amazing.

And then some of the most valuable dollars that your family will be able to put their hands on, right? Think about it. If you’re passing on an IRA or qualified plan, the family has rules on how quickly or how slowly they are going to access that money. They have to pay taxes at their tax rate when they access that money. So it looks like you have, let’s say, $100,000, but you really only have $60,000. And it’s increasing the taxes, right? Yeah. So it doesn’t feel good to pull money from those qualified plans when people have to or want to do that. But when it comes to life insurance, that money automatically gets passed on tax-free to the named beneficiary. And they have options, right? They don’t have to take into consideration income tax or state tax or going through probate.

Again, these are all the ancillary benefits of thinking long term.

If you’d like to start thinking long term and put this process to work for you, your family, and your business. Visit our website www.tier1capital.com and click the “Schedule Your Free Strategy Session” button to get started your no-obligation strategy session today. We’d be happy to chat about your specific situation, how we can make it as efficient as possible, and how to put you in the most control possible.

Remember: It’s not how much money you make, it’s how much money you keep that really matters.

When it comes to the Infinite Banking Concept, you may be wondering, did you miss the boat? Are you officially too old to get started with this concept? That’s exactly what we’re going to talk about today.

When you think about life insurance especially whole life insurance you may be considering the cost of insurance. Quite frankly, as the insured gets older, so does the cost of insurance. So, you may be wondering: is it too late to take advantage of this opportunity?

And the reality is yes the older you get, the cost per thousand dollars of life insurance death benefit definitely goes up. For example, I’m 62. Olivia is 33. So the cost for, let’s say, $25,000 of death benefit is going to be much more for me than it is for her. And there’s a reason why.

Let’s say we’re looking at a life insurance policy that is paid up at age 100. That means the insurance company has a 38-year window to put money away for me so that the policy is fully funded by my age 100. But for Olivia, they have 67 years a much longer window. So the annual premium will be lower and the amount they reserve each year will be lower as well.

With a whole life insurance policy, any off-the-shelf policy, the insurance company is making two guarantees. First, they promise to pay the death benefit if and when the insured dies so long as the policy is in force. Second, they promise that the cash value will equal the death benefit at the age of maturity. That means by age 121, the death benefit and cash value are the same.

There’s a trade-off between cost and risk. I may die sooner than Olivia simply because I’m older, so the insurance company is taking on more risk and that’s reflected in the cost. But the trade-off is that they’re also putting more money away each year for me to meet that guaranteed cash value at maturity. For Olivia, with a longer time frame, they can rely more on compounding interest and require less annual contribution.

It’s like a compound interest curve. To get the most out of compound growth, you need two things: time and money. The less time you have, the more money you need to contribute to get the same result.

Now, let’s shift to Infinite Banking. You finance everything you buy. So the question becomes: am I too old for Infinite Banking? That depends. We always ask people: are you done buying things?

You’re either going to borrow money and pay interest, or you’re going to pay cash and give up the opportunity to earn interest. You’re either paying interest or giving it up. There’s no way around it except through the Infinite Banking Concept.

The key to Infinite Banking isn’t just recovering interest although you might recapture it through the death benefit. The real key is being in control of the financing function in your life. Once you reach that point, it truly is a different lifestyle. It’s a life with less stress, more access, and more flexibility.

Most of life’s frustrations come from not having access to money when you need it whether that’s in an emergency or an opportunity. That lack of access can be paralyzing. I once had a friend whose grandfather had the chance to buy an entire city block in upper Manhattan for $45,000, decades ago. But he didn’t have the money and was afraid to borrow. Every time my friend passes that street today, he thinks about what could have been.

That’s the power of Infinite Banking having access to capital when you need it most, through a structure that you own and control: your whole life insurance policy.

When we talk to people about setting up policies, we don’t always start with the death benefit. That part becomes a bonus. We focus on premium dollars—how much can you contribute without negatively impacting your lifestyle? The death benefit is then calculated based on what that premium can buy for your age.

The death benefit guarantees that your family or business recaptures the value of all the interest you’ve paid—or given up—over your lifetime. And it’s paid out tax-free. That’s what makes Infinite Banking such a strong strategy. And that’s why you’re never too old.

We have a client who started Infinite Banking at 83. He’s now 91 and recently built a new home using policy loans. He’s thrilled because he got the home he wanted—and his family will still receive the death benefit down the road. Plus, they’ll get the house too. It’s a win-win.

Now, age is only one factor. Insurability is another. As we age, health issues can arise. That doesn’t mean you’re uninsurable, but some conditions—like recent cancer or heart procedures—can affect whether you qualify and at what rate. In some cases, we may be able to offer a rated policy, which means the premium is slightly higher. In others, we may suggest using a spouse or child if they’re insurable and you have an insurable interest in them.

There are options. The key is starting the conversation early enough to explore them.

If you’d like to learn more about how to put Infinite Banking strategies to work—no matter your age—hop on our calendar. Visit www.tier1capital.com and click the “Schedule Your Free Strategy Session” button to get started today. We’ll help you explore your options, assess your insurability, and build a plan that puts you back in control of your money.

Remember: It’s not how much money you make, it’s how much money you keep that really matters.

When it comes to building a legacy, there are a few ways you could go about it. And quite frankly, there’s actually one way where you could guarantee a legacy being passed on to your family members or charity of choice. And that is with whole life insurance.

Many people want to pass on a legacy but may be wondering how. When it comes to building enough wealth to actually pass on a legacy, you come into some risks. You have investment risk, you have longevity risk—the risk of outliving that money—and taxation risk. So the question becomes, how do we guarantee this legacy that we want to be passed on to the people we care about instead of the government, the markets, or a nursing home?

The point is, when planning for a legacy, you need to plan. And that doesn’t mean you all of a sudden wake up at age 75 and say, “Okay, let’s start planning.” It’s really something that has to be done throughout your life in preparation for the day when you pass on your legacy to the next generation or to the charity of your choice.

Now, I guess if you are age 75, you would be able to pass on a legacy—assuming you’re still insurable. But usually by the time people start thinking about legacy, it’s after their health has diminished and they’re no longer able to qualify for whole life insurance. So what happens is it ends up costing more to give the same amount of money to your family or your charity of choice. That’s why planning in advance—even just enough in advance—can make a big difference. And of course, the sooner, the better.

With life insurance, you’re purchasing dollars for the future with discounted dollars today in the form of premiums. It’s literally paying pennies for dollars of future delivery. And that’s a key point, because life insurance puts you in a position where you can leverage your assets.

For example, if you have $500,000 in investable assets and you plan to leave that to your children or grandchildren, that’s $500,000 of legacy. But technically, it’s less—due to taxation and the cost of transferring that money through traditional means, especially if your state has an inheritance tax.

With whole life insurance, you can use the interest from those investable assets to potentially pass on an even greater amount—say $1 million—by pairing the $500,000 in investments with an additional $500,000 of life insurance coverage purchased using that investment income.

It all comes down to making your money as efficient as possible. By combining whole life insurance with smart legacy planning—whether that includes naming a beneficiary, designating a charity, or setting up an irrevocable life insurance trust—you create the structure that ensures your intentions are carried out.

And that’s the real power here. If you leave your wealth to the uncertainties of the market or a potential long-term care event, you can’t be sure that what you want to happen will actually happen. But with whole life insurance, you’re working with one of the only financial tools that guarantees that your legacy will be fulfilled—even if you’re not here to see it.

If you’d like to learn more about how to put these strategies to work for your specific situation and guarantee your legacy, hop on our calendar. Visit www.tier1capital.com and click the “Schedule Your Free Strategy Session” button to get started today. Remember: It’s not how much money you make, it’s how much money you keep that really matters.

As a business owner, so much focus is put on building your business. How could you get that business up and running, generating profits for you and your family? Well, because of that, 90% of a business owner’s wealth is actually tied up within their business. But you can’t necessarily spend that money. It’s tied up in inventory and equipment and paying expenses. Today we’re going to talk about the importance of building wealth outside of the business so that you could both benefit your family and your business to experience the financial freedom that comes with actually being a business owner.

So much advice that’s given to business owners is actually putting them out of control of their cash flow. When it comes to cash flow, it’s important to make sure you’re in control of it because that’s how you’re able to build a pool of cash that you’re able to access because with access to cash flow comes the feeling of financial freedom which so many business owners are after.

You know, and 83% of business owners basically feel the stress from running the business is more than the freedom that they wanted when they went into business. Well, money problems are a big issue, especially when it comes to sleep at night, right? If you’re not able to pay your bills, you’re not sleeping. You’re trying to come up with a solution as to how you could get by and how you could continue to move forward with this huge burden on your shoulders.

So imagine having a business that’s worth a million dollars and further imagine having a million dollars of capital outside the business. That gives you so many advantages going forward. And they’re two separate things. It’s the same value, but having the million dollars value on your business, it’s being rich on paper. It’s being able to say, “Okay, I’m a millionaire. My business is worth this amount.” But it doesn’t feel like it, right? Because you can’t put your hands on any of it because it’s tied up in so many things. Whether it’s inventory, whether it’s expenses, whether it’s equipment, all of those things, they’re valuable, but only if you liquidate. And the problem is if you liquidate, you don’t have the business.

Well, kind of. Yeah. So now if you don’t have the business, you don’t have the income or the revenue that’s generated from the business. And that creates a big problem. But again, putting yourself in a position where you have access to capital outside the business that’s equal or greater than the value of the business. Now, that’s where the rubber meets the road.

But here’s the problem. Everybody says, “Well, I don’t have enough money to do that.” Right? The cash flow that you’re earning within the business is enough to keep the business going. Not much more. Right? Otherwise, you wouldn’t be in this position. But the reality is you do have the wherewithal to be able to create that second pile of money.

So, we said this in a blogpost. You want to view your business as a firecracker hut. Everything in that business you want protected so that it doesn’t explode. But you also want to create a second firecracker hut that’s completely liquid. So that if the business does explode, your retirement, your standard of living, your ability to get to retirement is not predicated on selling that firecracker hut that just exploded.

Exactly. So when it comes to positioning yourself, it’s real simple. The first step is to change your mindset. Change your mindset from getting out of debt as soon as possible or investing all of your profits back into the business or doing other things that really aren’t putting you in control of that money and instead redirecting that money to an area where you own and control. You still have the same net worth, right? You still have the same assets. You still have the same cash flow, but the difference is you now have access to a pool of cash. And that’s where that financial security and freedom comes from.

And we put this in practice and we’ve been putting this in practice for years for our clients. Recently, we had one of our clients who had been with us for about 30 years. He decided to retire. And it was probably a little premature, but what gave him the ability to pull the trigger and decide to retire was the fact that he was sitting on several million dollars of liquid capital that he had built up over the years with our advice. And because of that, he didn’t have to get the best offer on his business.

Now, here’s the irony. Because he had that money, he always turned away people who were trying to buy his business at a huge discount because they felt and thought he might want to get out of business. The reality was he wasn’t under any duress to sell the business. But all of a sudden, one day, somebody gave him an offer literally that he couldn’t refuse. And because he was in such a great financial position outside of the business, he was able to wait around to get the absolute best offer. Now, it doesn’t always happen that way, but it does happen when you have access to capital.

And this is what we talk about all the time. People who have access to money have access to opportunities. If you don’t have access to cash, the opportunities may pass you by. Or in this case, he would have taken a lesser opportunity because he would have been desperate for cash because the only money that he had or the only wealth that he had would have been tied up within the business.

Exactly. So now because he had that second firecracker hut, all of a sudden he didn’t have to take those lowball offers. And lo and behold, somebody came by with again an offer that knocked his socks off. And they pulled the trigger and the next thing you know, he’s living in retirement.

So, when it comes to building that wealth outside of your business while still running your business, it can feel challenging, especially when 61% of business owners are feeling chronic or cyclical cash flow issues. But what it comes down to is changing those daily disciplines of how you are using your money to get that money back inside of your control. You’re able to regain control of that finance function. You’re able to regain control of that cash flow and make better decisions for yourself and your business so that you’re able to build that pool of money on the outside while still having the value of your business on the inside.

And that’s a great point because you may be sitting there saying, “Well, geez, Tim or Olivia, we would love to be able to build that second pile of money, but we’re having cash flow problems ourselves. How do we do this? We can’t bring in more money.” Well, you don’t need to. The point is, the money is there. It’s just hidden in plain sight. And our process shows you how to uncover that cash flow that’s being used inefficiently. You think it’s moving you forward. It’s actually holding you back from having that second pile of money, that second firecracker hut, if you will, that is outside the value of your business.

If you’d like to learn more about how to build this wealth outside your business, hop on our calendar. Visit www.tier1capital.com and click the “Schedule Your Free Strategy Session” button to get started today. We’d be happy to chat with you about your specific situation, your specific cash flow, and how we could help you move forward to put yourself, your business, and your family in a more secure financial position. Remember: It’s not how much money you make, it’s how much money you keep that really matters.

Are you thinking about implementing the Infinite Banking Concept and deciding how exactly to go about it? You may be wondering, do I really need a life insurance policy in order to achieve this? That’s exactly what we’re going to talk about today.

So let’s jump right into it. Do we actually need life insurance policies to accomplish the Infinite Banking Concept? And I think another question we could address is, what happens if I can’t get a policy? What if I’m uninsurable? How do I go about implementing?

That’s a great question. And really, let’s look at it. Basically, the answer is no, you do not need a life insurance policy to be in control of the financing function in your life. You could control the financing function through a home equity line of credit, or a business credit line, or a margin account, or your 401(k), certainly a life insurance policy, a savings account, a CD—whatever you use as the depository becomes your source of capital.

Now, to truly be in control, you’ve got to make sure you’re controlling all the pieces. And here’s what I would say: a credit line or a home equity line of credit, you’re not in control, because you’ve got to go to the bank and get approval to be able to tap into the equity, right? So some people will be knocked out there as well. If you’re disabled, if you don’t have a steady job, if you don’t make enough income, if you don’t have enough equity, then you can’t be in control of that function, right? Knockouts—because the bank is not going to approve you. So that’s one thing.

But here’s the other piece, the other side of that coin, which is really what happens: a credit line or home equity line of credit—the bank has the ability to call those loans in whenever. And people say, “Oh, well, that’s not going to happen.” Well, it did. It happened in 2008. If you had a credit line with certain banks and they didn’t like what was going on in the economy, you got a letter. And the letter said, “Hey, you’ve got 60 days to seek a new banking relationship.”

Basically, think about it. If you had a $50,000 credit line and you had $45,000 out on that line, you had to come up with $45,000 during the financial crisis. So again, that’s where they always say there’s an old saying, “A banker is somebody who will sell you an umbrella when it’s sunny and take it back when it starts to rain.” And that’s really where the genesis of that statement came from.

You could also use a margin account—a stock portfolio, right? But then we have the risk associated with the underlying investments. And if the underlying investment goes down for whatever reason, then you can get what’s known as a margin call, where you have to pay back principal and interest. So that makes that a little bit more risky.

401(k)? You’re limited. You can only take 50% of the value as a loan of your 401(k), up to $50,000. And the loan has to be paid back in a stipulated period. Again, you’re not in control. You’re not in control of the terms. You’re not in control of the interest rates. You’re not in control of anything. You’re not in control of the conditions of paying back that loan. Less than ideal, but doable if necessary.

And then the savings account—you can go to a savings account. It’s interesting. Nelson Nash clearly showed this in his book Becoming Your Own Banker. He had a comparison between using Infinite Banking in a policy and using Infinite Banking with a savings account. And he showed a 4.5% savings account versus a policy.

Now, here’s the key. For the first 13 years, the savings account was a better place to do this. Because you were in control of the function, you were earning interest—all of those things. But Nelson was trained as a forester, and so he thought long term. By the time he finished his analysis, the life insurance ended up with over $700,000 more in value—not death benefit, value—versus the CD or the savings account. Then on top of that, you get the death benefit.

So Nelson clearly showed, number one: you don’t need life insurance to become your own banker, to use Infinite Banking. But number two: he showed why life insurance is the best place or the best depository for the implementation of Infinite Banking.

Now, with the savings account though, when you take money, they don’t have a loan feature with savings accounts. So if you access the money, does that interrupt the compounding in his example?

No, but what you have to do is go to the bank each time you want a loan and get approval to collateralize your savings account. So again, you’re not in control of that process, because the bank could come back and say, “Well, you know, the economic conditions in the country were different when you started this process. Now it’s not as favorable. So we’re not…”—they don’t have to approve you.

But again, here’s why Nelson liked life insurance—because the loan provision was a contractual guarantee. It was in the policy that the company has to loan money to you. Well, gee, that puts you in control of the function. And that’s what it was all about. It wasn’t about interest rates. It wasn’t about “I have more money for 13 years.” It was “I want to be in control.”

Because not being in control—he found out what it’s like to not be in control of the financing function. That’s where he was up at 2 and 3:00 in the morning, on his knees praying, “Lord, help me find a way out of this financial prison I made for myself.” And boom, the answer was life insurance.

So Nelson vetted all of those other depositories, those other sources of capital, and he came to the conclusion that life insurance was the best place. And in his terminology, “What better place than free people coming to an agreement under their own free will?” And that’s between the life insurance company and the owner. Exactly.

So the long and the short of it is, there are options if you don’t want to use a life insurance policy to implement this concept. This concept is about being in control of your money, making your money as efficient as possible.

We just did a video recently on what is the Infinite Banking Concept. Go ahead and check that out if you’re interested in learning more there. But yeah, we’re able to help with life insurance. And I do believe that life insurance is one of the most efficient ways to implement this concept, because it’s a closed system that you have full liquidity, use, and control over. And that’s what this concept really is all about—control and freedom.

And there’s one other piece to this—it’s the death benefit. The legacy. You can make all these purchases over your lifetime—and we all will, right? You’re not going to stop spending money. And then when you die, somebody’s going to benefit from your foresight. What better way? What better system?

Well, there’s no better system, especially from a legacy and death benefit perspective. So thanks for bringing that up.

If you’d like to learn more about how to implement Infinite Banking and take control of your financial future, we invite you to schedule a free strategy session with our team. We’ll take a look at your unique situation and help you explore whether life insurance or another option makes the most sense for your goals. Visit www.tier1capital.com and click the “Schedule Your Free Strategy Session” button to get started today and remember: It’s not how much money you make, it’s how much money you keep that really matters.

When it comes to financial freedom, most people find themselves starting from one place: debt. Whether it’s credit cards, auto loans, student loans, or just the cost of living, debt can feel like a never-ending cycle. So how do you manage debt while building wealth? That’s exactly what we’re diving into today.

Americans are carrying more debt than ever before. Credit card balances alone have surpassed $1.16 trillion for the first time in history. With our modern “subscription lifestyle,” where small recurring payments add up quickly, it’s easy to lose control of your cash flow. Most people are told to pay off debt first and then start saving. But that strategy can keep you stuck in the same cycle. We believe in something different start saving while paying down debt. Even small contributions to your savings now can be the difference between breaking the cycle or staying trapped in it. The truth is, without savings, you’ll always rely on more debt when unexpected expenses come up. And life always happens. Having a pool of money you control helps prevent future debt and gives you financial breathing room.

One major reason people stay stuck in debt is because they don’t have access to their own money. If every dollar you make is going toward paying off credit cards, you’re not building any safety net. When an emergency hits, the only option is to go back into debt.

It becomes a cycle: get out of debt, fall back in, and repeat. You’re never really getting ahead.

After COVID, we saw massive lifestyle inflation. Many people started spending more due to the influx of government money and now find it hard to adjust to rising prices. Doing a simple audit of your monthly expenses especially recurring ones like subscriptions can uncover hidden cash you can redirect toward savings or debt reduction.

Here’s a staggering statistic: over 80% of the U.S. dollars in circulation today were printed in just the last four years. That means the value of each dollar has decreased dramatically. It’s harder than ever to get ahead using outdated financial strategies. If all your income is going toward debt payments, you’re not saving. If all your income is going toward saving, your debt continues to grow because of interest. So what’s the solution? You need a hybrid approach pay down your debt while building savings. This combination gives you the flexibility and control to stop relying on credit and start financing your life on your terms between Good Debt and Bad Debt.

One of the first steps in taking control of your finances is analyzing the type of debt you carry.

Good debt typically helps you grow or build wealth, like a mortgage or business loan. Bad debt, like high-interest credit cards or consumer financing, generally adds no long-term value. The goal is to keep the good debt and eliminate the bad. Not all debt is bad, and not all debt is good. Being able to tell the difference is key. Every time you buy something, you’re financing it whether you realize it or not. You either borrow and pay interest, or you pay cash and give up the ability to earn interest. That’s called opportunity cost. So even when you pay in cash, there’s a hidden cost: you lose the potential growth of that money. Understanding opportunity cost can help you make smarter choices about how you finance your lifestyle and major purchases.

Ask yourself, “Does it feel more efficient to finance this and keep control of my cash, or should I give up that cash and reduce my liquidity?” More often than not, using someone else’s money (in a controlled, smart way) can be the better choice especially if you keep your own money working for you. Leverage is the concept of using the least amount of your money to control the greatest amount of assets. It’s how the wealthy grow their wealth faster and more efficiently. If you can maintain control of both the debt and the asset, you’re in a position to grow. That’s the power of smart leverage. You’re building an asset with one hand, paying down a liability with the other, but you never give up control of your money in the process.

This approach lets you save, borrow, and grow wealth at the same time. Your dollars become more efficient doing two or even three jobs at once. It may sound counterintuitive, but it’s how real wealth is built.

Traditional financial advisors often focus on assets under management meaning they want to help you grow your investments. But what if you don’t have savings yet? What if you’re still in debt? Most advisors will tell you to pay off debt first, then come back when you’re ready to invest. But that doesn’t help you now.

Our approach is different. We work with you from where you are. Whether you’re able to save 5%, 10%, or 20% of your income, we help you get started and adjust your plan as your situation improves. You can start building savings now, even while you’re still paying down debt. You don’t have to wait until your finances are perfect to start improving them. You just have to start.

If you want to learn how to apply these debt management and wealth-building strategies to your own situation, visit our website at tier1capital.com and schedule your free strategy session.

We’ll help you:

• Evaluate your current debt
• Find inefficiencies in your cash flow
• Create a plan to build savings and pay off debt—simultaneously

You don’t have to keep struggling with debt. There’s a better way, and it starts with making your money more efficient.

Thank you so much for reading, and remember:

It’s not how much money you make. It’s how much money you keep that really matters.

When it comes time to pass on your business interest, it’s critical to do it in a way that’s both cash flow-friendly and tax-efficient. In this post, we’re diving into a strategy most business owners overlook but one that can make all the difference when it’s time to exit or transition ownership.

For many business owners, talking about succession is uncomfortable it feels distant or even morbid. But the sooner you plan, the more effective and seamless your business transition will be.

According to the Exit Planning Institute:

• 74% of business owners want to pass on their business.
• But only 18% have a plan that’s been communicated to those involved.

That’s a huge disconnect.

To make matters more urgent, 80–90% of a business owner’s wealth is typically tied up in the business itself. Without a solid strategy, you risk getting only 24 cents on the dollar for every dollar of value you’ve built in your business. Life insurance is often misunderstood but in the context of business planning, it’s a powerful tool. Think of it as “dollars for future delivery.” Depending on the type of policy, you can build cash value while funding your plan. This means:

• You maintain liquidity, use, and control of your money.
• You’re not sacrificing your business’s growth in the process.
• You’re actually building a pool of cash you can access along the way.

And that pool can be used to grow or operate the business not just fund the future transition. Here’s the beautiful part: with life insurance, you’re essentially purchasing future liquidity at a discount paying pennies on the dollar each year in the form of premiums.

This means:

• You build access to capital.
• You create a funded succession plan.
• And you strengthen your business along the way.

It’s not just protection it’s a business growth strategy. The death benefit ensures that, when the business owner passes, there’s guaranteed cash available to buy out their equity and smoothly transfer ownership. In short, the event that causes the problem (death) is also the trigger that activates the solution (insurance payout).-Life Example: The Cost of Not Planning

Let’s look at a true story.

A third-generation local business failed due to poor succession planning. The founder left everything to his spouse, who had never worked in the company. His two sons ran the business, and his two daughters weren’t involved.

When the mother passed away, estate taxes kicked in, and the sons had to buy out their sisters. With no liquidity and no plan, they had to borrow from the bank. Everything went fine until the 2008 financial crisis. The bank called the loans. The business couldn’t pay. It went bankrupt.

As a result:

• The family lost the business.
• Their five sons lost their jobs and careers.
• 150+ employees lost their livelihoods.

All because there was no succession plan and no insurance to fund the transfer.Two-Part Succession Solution: Planning + Funding. Creating a plan is just the first step. Funding the plan is what brings it to life. And here’s the good news the funding doesn’t have to come from new obligations. We typically find the money for premiums within your existing cash flow by identifying inefficiencies and redirecting them.

In most cases, the money you think is moving your business forward is actually holding you back. We help you reallocate that money to fund your succession strategy without adding financial strain. So instead of ignoring a problem because it feels too expensive to fix, we help you fix it with the resources you already have. Unlike other insurance strategies that lock up your premiums, this approach allows you to retain control of your cash. As you build the policy:

• You’re creating a pool of capital you can leverage.
• You can use that cash to grow the business, cover cyclical cash flow issues, or seize opportunities.
• All while securing your eventual exit or transfer.

It’s a win-win strategy that improves your financial position now and in the future.

If you want to learn more about putting these strategies to work for your business and your family, visit tier1capital.com and schedule your free strategy session today. We’ll help you uncover inefficiencies, build your plan, and fund it all while improving your cash flow and peace of mind. And remember: It’s not how much money you make. It’s how much money you keep that really matters.

As a successful entrepreneur, it’s easy to feel like we have everything figured out. But the reality is we never truly do. There’s always someone out there who knows a little more or sometimes a lot more than we do in specific areas. Today, we’re talking about the value of financial mentorship for entrepreneurs.

No one person knows everything. That’s why it’s so important to have people around you who have more knowledge and experience in different areas. As an entrepreneur, you need a team around you. You’re great at what you do but how do you bring in others who are great at what they do, so everyone can help each other succeed? The bottom line is simple: better teamwork leads to better results.

No one has the market cornered on great ideas. Take taxes, for example. The U.S. tax code is over 14,000 pages long and no one person understands it all. But there are people who specialize in specific sections and know them better than most.

We see this all the time with business owners who rely heavily on just their CPA or attorney. Now, that’s not necessarily a bad thing but sometimes, those advisors don’t want to admit they don’t know something. This is especially true in the financial services industry. There are countless approaches to personal and business finance and just as many opinions on what works best.

Lawyers are excellent at law. CPAs are great with taxes specifically, the areas they focus on. But there are other CPAs who specialize in different parts of the tax code. So, how do you find the right people who align with your goals and bring them together to help you make the best financial decisions?

Here’s the challenge: You’ve got someone handling the legal side of your business. Someone else focused on taxes. And another advisor managing the finance side. But they’re all working in their own corners, disconnected from one another.

We call this the Three Blind Mice approach. The legal advisor doesn’t know what the tax or finance advisor is doing. The tax advisor doesn’t know what legal and finance are doing. And the finance advisor doesn’t know what tax and legal are doing. They’re all giving you advice maybe even accurate advice based on limited information. And here’s the curse of being an entrepreneur: We tend to put people in boxes, and mentally limit them to only one role. But that mindset can cause problems over time. So what’s the solution?

Bring your team together. Make sure everyone is aligned and communicating. That way, each advisor can give better, more tailored guidance based not just on their own knowledge, but also on what the rest of your team is doing.

Here’s how we look at it: You, the client, are the head coach. Your legal advisor might be the offensive line. Your finance expert is the running back. Your tax pro could be the quarterback. We’re applying for the role of offensive coordinator the one who pulls it all together and ensures everything runs smoothly. That approach is way more effective than keeping people stuck in silos. And the truth is, a lot of our specialties overlap. We know a bit about everything but we’re not the experts. Only the experts are the experts. So it’s essential to find the right ones and make sure they’re working together to move you forward.

Let me tell you a quick story. We met a business owner about 7 or 8 years ago. He said: “I’ve got two financial advisors and a CPA I meet with monthly. If there was anything important I needed to know, they would’ve told me.” We simply said: “Nobody has the market cornered on good ideas. Maybe we can offer a fresh perspective something that could benefit you and even help your existing advisors.” Sure enough, the strategy we recommended was completely different from what his other advisors were suggesting. In the end, he became a client. His CPA became a client and even his attorney became a client. Why? Because our approach is built specifically for entrepreneurs.

We look at everything through the lens of control. Will this financial decision give you more control or less control? And control means this: Liquidity. Use. Control of your money.
That way, you can build up a pool of cash and leverage it to pursue your goals without disrupting all the other pieces of your plan.

Now, here’s another common belief among entrepreneurs: “If I just land one big deal, it’ll solve all my problems.” And when that deal does come through, sure things may feel better, for a little while.
But if you don’t use that cash efficiently and strategically, you’ll find yourself right back where you started. You have to plug the holes in your leaky bucket and that’s exactly what our approach helps business owners do. Many people believe that earning more income will fix their finances. But if you have inefficiencies in your cash flow or leaks in your “circle of wealth” those problems won’t go away. In fact, they grow as your income grows. That’s why it’s so important to start now to fix the inefficiencies and start keeping more of your money. That way, you’ll build real financial security as your business grows.

If you’d like to learn more about how to put these strategies to work for your business and your family, visit us at tier1capital.com. We’d love you to schedule a free strategy session where we look at your specific situation and talk about how to help you regain control. And remember, It’s not how much money you make. It’s how much money you keep that really matters.

When it comes to growing and scaling your business, there’s a ton of information out there. Today, we’re going to talk about five definitive strategies to scale your business and to make it grow going forward.

When it comes to scaling your business, there’s a delicate balance between that growth and making sure you have enough cash flow to sustain the operations of the business along the way. There’s no guarantee your business is going to be around 5, 10, 15, 20 years from today, but if you have a long-term mindset, that puts you in a position to weather the storms, if you will, that are going to come your way as a business owner.

So a lot of times, business owners are thinking day to day, which they have to. They have to be quick on their feet, making sure they’re putting out all the fires so that their business can persevere through those storms. But it’s important to also step back and look at things on a larger scale. How could I move my business forward this year, in five years, in 10 years? What steps need to be taken, and what steps can I take today to make sure that’s going to happen?

We get sort of caught up in putting out the fires, and that becomes our job almost. But as a business owner, we also have to think when we’re putting out fires, we’re working in the business. But we also have to work on the business doing the long-range planning, making sure that our business is set up for the long term. Especially as a business owner, you need to think about how you’re going to monetize the business at the end of the road, right? What planning could be put in place today to put you in a position where you’re able to monetize this business to fund your retirement, for example?

So that you know, again, thinking long-term, you have to think of all the plans that need to be in place: your exit plan, your succession plan, maybe a key person retention plan. These are all the long-term things that need to occur to make sure that your business is going to be around for the long term. Because if we don’t have the key people in place, the business isn’t going to be worth as much. If we don’t have the exit or succession planning in place, we’re not going to be able to get as much out of the business as you put into it to sustain your lifestyle throughout your retirement.

How could we use other people’s money to help our business grow?

As a business owner, we don’t necessarily have piles of cash set aside to grow the business. And if we do, it may not make the most sense to invest that money back into the business immediately, because then you’re giving up access to that money immediately. Making sure that you have access to capital to run your business and grow your business is paramount. But then, how do we leverage other people’s money so that we don’t have all of our skin in the game? We need to have skin in the game, obviously. But the key is, how do we limit that so that we can leverage other people’s money?

There have been books and movies and videos done on leveraging other people’s money. But the key is doing it in a controlled fashion and this kind of ties in with our third point our third strategy of having that access to money. We need to leverage other people’s money, but we also need to have access to our own money, and they go really hand in hand, right? So the more access we have to our own money, the better terms we’re going to be able to get to leverage other people’s money. Because, at the end of the day, we’ll have the cash on the side to pay that back if necessary, at least from their perspective.

Access to capital is what is going to allow you to run your business. Access to capital is what is going to allow you to grow your business. Too often, we find businesses whose only access to capital is through banks or finance companies. And that may not necessarily be a bad thing, but sometimes it can get out of control because you’re not in control of the finance function. And we talk about it a lot on this blog, but when you’re in control of the finance function, it’s a better life. It’s a different life. And again, there’s no substitute for control.

By extending amortization schedules, that takes up less of our day-to-day or monthly cash flow, which allows us to have access to more of our own capital. And by doing it that way, we’re literally leveraging other people’s money in a way that’s positive for us because now we’re in control. We’re in control of more of our monthly cash flow. So you don’t just wake up one day and have a pile of cash sitting on the side saying, “Oh, now I have access to money.” It’s taking those small steps, maybe like extending your amortization schedule, so you’re able to build up that pool of cash quickly or slowly, depending on what your business cash flow looks like. And let’s take that to the next logical conclusion. So when you extend your amortization schedules, you free up more monthly cash flow that you could redirect to build your own pile of money.

Eventually, maybe your pile of money, as you’re paying down your bank loan, is growing. When you get to a point where you have a lot more money than you owe, now you can pay off the bank loan. And now you can determine what the cash flow is to pay off that loan. That’s where you could really get some significant results.

You know, all that energy is flowing back to you, and it just starts building upon itself. Everything begets more. And now, all of a sudden, you’re sitting on a pile of money. And, oh, by the way, that could be your long-term exit. So think about this as a business owner. Whether it’s a big business or a small business, how much of your money is going towards debt on a monthly basis? And what impact would that make to your financial position if all of that monthly cash flow was going to an entity where you had full liquidity, use, and control of that money, instead of all of that money going out the window?

That’d be huge. That’d be a huge pile of money.

So if I’m hearing you properly, what you’re saying is your amount of debt won’t change. But what will change is who that debt cash flow is being directed towards. It’s either going to be directed away from you or directed towards you.

If you’d like to learn more about how to put these strategies to work for your business and your family, be sure to visit our website at tier1capital.com to schedule your free strategy session today.

We’ll break down your specific finances, talk about how to put you back in control of that finance function so that you can sleep better at night knowing that you’re putting your business in the best possible position to succeed. And remember:It’s not how much money you make, it’s how much money you keep that really matters.