Valuable Finance Insights from Tier 1 Capital

Learn about financial strategies to enhance business and personal cash flow. Get tips that will help counteract the effects of inflation. Discover unconventional wisdom related to life insurance, infinite banking, wealth building, and much more—here in the Tier 1 Capital blog.

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Infinite Banking 101: What Policy Should I Use?

Are you looking to get started with the infinite banking concept? But you’re wondering what the best type of policy is, whether it’s universal life, index universal life, variable universal life, or whole life insurance? Well, if that sounds like you, stick around to the end of this blog because today we’re going to do a deep dive on what the best type of policy is for you and your situation.

The infinite banking concept uses life insurance as a vehicle to implement the process. But let’s take a step back and think about what exactly is insurance fundamentally. 

Life insurance or any insurance, for that matter, is technically a transfer of risk from you to the insurance company. And the cost of doing that is a premium that the insurance company charges. 

 

Now, let’s take a look at the various types of cash value life insurance and the characteristics of each. 

Fundamentally, life insurance, or any insurance for that matter, whether it’s homeowners or car insurance, is a transfer of risk from you to the insurance company. Basically, you’re saying, “I have this risk. I don’t choose to accept it. I need to transfer it.” The insurance company raises its hand and says, “Hey, we’ll charge you a premium for that risk.” And they’re working with the law of large numbers. They’re working on thousands of people who are in the same situation that you’re in. 

But now let’s look specifically at life insurance. Let’s say you have a $100,000 risk that you don’t want to accept. You transfer it to the insurance company. With a whole life policy, it’s all bundled together. It’s a neat little package, and it’s guaranteed to have more cash value next year than it did this year. That’s because the insurance company is making two promises:

  1. They’ll pay the death claim whenever you die. 
  2. When you reach the age of maturity, let’s say age 121, they’ll have the face amount of the policy available for you in cash should you want it. 

Now, let’s take a look at some other types of policies. There’s universal life, there’s indexed universal life, and there’s variable universal life. 

But the chassis is universal life. And what that basically means is: the technical term for universal life is flexible premium adjustable life. If you want to have the flexibility of making various or not making payments, you can do that. Here’s the problem: that variability creates some additional unwanted risk that most insureds don’t understand. Quite frankly, most insurance agents don’t understand it. Now, there are three variables that the insurance company needs to consider as it relates to a life insurance policy. 

  1. Mortality. Are more people going to die than expected? 
  2. The cost of running the company. Is it going to cost more than we anticipated? 
  3. Investment returns. Are we going to earn enough like we anticipated as it relates to this policy?

Now, with a whole life insurance policy, the insurance company assumes all three of those risks. Basically, what they’re saying is: “If more people die sooner than later, we can’t change the deal. If it costs more to run the company due to things like cybersecurity, we can’t change the deal. And if we don’t earn enough interest on our reserves, we can’t change the deal. We own it. You’re off the hook.” 

Life insurance policy contracts are unilateral contracts, meaning that the owner of the policy has one responsibility, and that’s to pay the premiums and pay the premiums on time so the policy doesn’t lapse. All of the other risks are completely on the insurance company. They have to deliver on everything else that’s listed in that contract. 

Here’s the issue as it relates to universal life, variable universal life, or equity indexed universal life: the insurance company gave itself an escape clause. They allowed themselves to transfer the investment risk back to the insured. The insurer doesn’t know it or realize it, and I guarantee you the agent never explained it to the insured in that way. 

But, basically, what it says is: If mortality is greater than expected, if expenses are greater than expected, and if our investment return isn’t what we expected, we reserve the right to change the deal. 

 

How do they do that? How can they do that? Well, it’s real simple. Run an inforce illustration, run a sales projection, and you’ll see that some of these policies start to fall apart in your late sixties or in your seventies.  And what does that mean? Basically, it means that the policy expires before you do. 

Now, think about it. Life insurance is the fundamental vehicle for infinite banking. And yet some people are recommending a product that won’t be around as long as you may be around. In other words, you have to die to win. 

Another thing to consider is if you allow the policy to lapse and there’s a gain on that policy, meaning you don’t want to pay any more premiums because it’s cost prohibitive. What you could end up with is a huge tax bill because there’s so much gain within the policy and all of the gain is taxable as ordinary income. 

Here’s the thing with these universal life policies. In your later years, the cost of insurance could get very expensive. And it will. So you’re left with the choice of paying an astronomical amount of premium and then having to pay the premium again at a higher amount the following year, or just allowing the policy to lapse. Now, if you let the policy lapse and you’ve used it for infinite banking purposes, there’s a high probability that you’ll have a taxable gain, and that taxable gain is going to be fully taxable at ordinary income rates. 

In Nelson Nash’s bestselling book, Becoming Your Own Banker, on page 39, he clearly expresses his thoughts on universal life. Universal life came into play in the early 1980s. It was created by a company called E.F. Hutton, a stock brokerage firm. And in Nelson’s opinion, they knew nothing about life insurance. For those of you old enough to remember the commercial, you remember when E.F. Hutton spoke. Everybody listened. 

Have you heard ‘em lately? They don’t exist. 

Universal life is nothing more than one-year term insurance with a side fund. And if you remember, back in the early eighties, interest rates were 15-16%. And those policies didn’t work then. So could you imagine, under today’s interest rate environment, how faulty and how much risk you’re accepting as far as the interest rate is concerned? 

Universal life was an attempt to unbundle the savings and the insurance components of life insurance, which, if you understand whole life insurance, it can’t be done. You can’t unbundle the whole life contract. Here’s the thing with the universal life contract, the flexibility you’re getting cannot be duplicated with the whole life policy. However, it can come close and at the end of the day, the risk that the insurance company is pushing back to the owner of the contract is not worth the flexibility. 

This takes us to the policy illustration. When you’re choosing insurance companies or you’re choosing insurance policies, generally an agent will show you an illustration or a projection of how the policy might perform. And it is very tempting to look for the highest yielding illustration. But that is such a slippery slope. There are so many variables that the insurance company can manipulate to create that better-looking illustration, and it is not worth the time of day when you look at those illustrations. If you’re judging whether or not you should purchase a policy based on an illustration, stop the process – you’re off the rails.  

The issue is how are you going to use that policy? And what Nelson Nash proved to us in his bestselling book, Becoming Your Own Banker, you will have the greatest impact on the performance of that policy. You will have the greatest impact on how that policy serves you. 

Some of our clients use these policy loans to get out of debt faster, take advantage of investment opportunities, start their own business, or send their children to college.

The point is: how are you going to utilize this policy to move you toward your financial goals? And what is that worth? 

 

With these policies designed for cash accumulation, you have the opportunity to take advantage of the internal rate of return as well as an external rate of return. So it really comes down to how you are going to move forward using these policies and taking advantage of the continuously compounding interest that happens within your contract. And that’s the importance of the infinite banking concept when you’re trying to regain control of your money. 

The key with infinite banking is you are in control, and because you’re in control, you can’t change the deal. Or you can. It’s up to you. 

If you’d like to get started with a specially designed, whole life insurance policy designed for the infinite banking concept to help achieve your financial goals. Be sure to visit our website at tier1apital.com to schedule your free strategy session today. Or if you’d like to learn more about how our process works, take a look at our free web course listed right on our homepage. 

And remember, it’s not how much money you make, it’s how much money you keep that really matters.

Tips for Insuring Your Most Valuable Asset

Have you considered insuring your most valuable asset? And you may be wondering: what is your most valuable asset? It’s your ability to work and earn income! But, what would happen if you woke up tomorrow and were no longer able to work? What would happen to your family? What would happen to your lifestyle? If you haven’t considered this, stick around to the end of this blog because today we’re going to do a deep dive on how to insure your income. 

It’s often been said that insuring your greatest asset, your ability to earn income, is the equivalent of insuring the goose that lays the golden eggs. Many employers offer short-term disability insurance as part of their benefits package, but that could last anywhere from 90 days up to two years. So, what happens after that benefit period? If you’re still not able to work and earn income, then what? What happens to your lifestyle? What happens to your family? How do you support the things that you’ve become accustomed to when you’re not able to work any longer? 

There are other situations where your employer doesn’t offer those benefits or you’re self-employed and you don’t have that luxury. And those cases, it’s especially important to have set aside 3 to 6 months of income as a safety net or emergency fund in case you’re unable to work. 

Disability insurance is sort of like having a safety net as you’re ascending this ladder in life. The higher you climb up these stairs or this ladder, the higher you want that safety net. 

With a long-term disability policy, you’re transferring the risk of becoming unable to work to the insurance company. So, basically, you pay a premium every month, and if you become unable to work, the insurance company will continue your income. So, now, you have a steady stream all the way into retirement. 

Typically, an insurance company will insure 50 to 60% of your income, which is the equivalent of your net pay after taxes. Disability insurance is a cornerstone of any financial plan. Imagine what would happen if you were no longer able to work into retirement. How would that impact your retirement? How would that impact your family? How would that impact your ability to maintain your lifestyle? These are all questions that a properly designed disability insurance policy will answer for you. 

Here’s an example: 

A couple of days ago, we were working with a young attorney who makes about $150,000 per year. And he said, “Should I get disability insurance?” 

I said, “Well, it’s basically the choice of two jobs. Job A pays you $150,000. But if you get sick or injured and cannot work, you and your family get nothing coming in. Job B will pay you $147,000 per year. But if you get sick or injured and can no longer work, you’ll have $120,000 coming into your family tax-free. Which job would you choose?” 

He said, “Oh my God, that’s a no-brainer, Job B.”

If you’re looking to add a safety net to your financial plan by adding long-term disability insurance to your portfolio be sure to visit our website at tier1capital.com to get started today. We’d be happy to go over the specifics of your situation with you. 

And remember, it’s not how much money you make, it’s how much money you keep that really matters.

How to Use Whole Life Insurance to Achieve Financial Freedom

Are you rich on paper but feel financially stuck and frustrated? Take a look at your net worth statement. Identify which assets are stagnating assets, meaning that some other financial institution or some other entity is in control of that asset. 

It’s been said that money needs to flow. It’s a simple law of nature, just like water has to flow through us or we die. Blood has to flow through us, or we die. If we’re out in nature and we’re thirsty, we never drink stagnant water. We always drink running water. And it’s the same with our money. 

But what conventional wisdom teaches us to do with our money is to park it, leave it there as long as possible, and then get it back someday. We are trained to do things with our money that we would never do with the things that money buys. 

Here’s an example: 

  • You would never buy a loaf of bread, put it away, and say you’re going to eat it in 40 years. Yet we do that with our money. 
  • You would never buy a car and put it away and say, I’m going to drive it in 40 years. Yet we do that with our money.

And there are so many other decisions that we are trained to do with our money that we would never do with the things that money buys. 

So the question becomes: how do we achieve the returns we get by parking our money while still allowing our money to flow so that we could have complete liquidity use and control of that money to take advantage of opportunities or emergencies that come about? 

This is step three in our process. It’s a specially designed whole life insurance policy for cash accumulation that allows you complete liquidity use and control so you can take advantage of financial opportunities or business opportunities, or bail yourself out of a financial or medical emergency. This allows your money to flow and still receive or attain the returns that you would get by parking your money. You get the best of both worlds. You get a reasonable rate of return, plus you get liquidity use and control of your money so your money flows. 

If you’d like to get started with a specially designed whole life insurance policy for cash accumulation, so your money is no longer stagnant. Be sure to visit our website at tier1apital.com and feel free to schedule your free strategy session today. 

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

5 Ways You’re Unknowingly Giving Up Control Of Your Money

Do you make a good income but still find yourself living paycheck to paycheck? If that sounds like you, stick around to the end of this blog. Today we’re going to show you why it’s not how much money you make, it’s how much money you keep that really matters. 

Many people will come to us already earning a good income. In fact, they’re earning more income than they thought was ever possible. But they still have that feeling that they’re living paycheck to paycheck. And, clearly, that’s not an income problem. If it was, they wouldn’t have any problems. The issue is their money and their cash flow are not working efficiently. 

If you don’t correct how you’re using your money, the problems will continue to compound as your income grows.

We’ve found that there are five major areas where people are giving up control of their money unknowingly and unnecessarily. Unknowingly, meaning they don’t realize they’re doing it, and unnecessarily meaning they could stop whenever they want to. 

The five areas are:

The first step is to take a look at your finances and find out where you’re giving up control of your money. 

The second step is to “simply” stop doing those things that are taking control away from you. “Simply” is in quotations because these are things that you’ve been doing all your life; things that conventional wisdom, your family, or your mentors may have suggested you do to get ahead financially. But what’s happening is you’re giving up control of your monthly cash flow to other institutions. And when you’re doing that, it’s impossible for you to move ahead financially. 

Step three is to save your money in a place that you own and control so that only you, your family, or your business can access that money. 

And step four is where the magic happens. It’s where you borrow from yourself and pay interest back to yourself or that account that you own and control. And when you do that, you are now in control of the borrowing process. Money never leaves your control, and you are what we refer to as cash fluent. 

Think of the impact it would have if you had complete liquidity use and control of the financial function in your life where you’re building cash flow for yourself, using it to achieve your financial goals, and rebuilding it so you could repeat the process. And an added bonus not stated in there is the fact that now you’ve liberated yourself from the banks and finance companies. 

Clearly, it’s not your income that’s holding you back. If that were the case, all of your problems would have been solved three raises ago. It’s how you’re using your money. If you’re finally ready to regain control of your money and start saving for your financial goals, be sure to visit our website at tier1capital.com. 

We have a free web course where we do a deep dive into the four steps. Or, if you’re ready to get started and get on a call, feel free to schedule your free strategy session to get on our calendar today. Also, if you know someone who needs this information in their life, be sure to share this blog with them!

And remember, it’s not how much money you make, it’s how much money you keep that really matters.

Plan For Retirement Without Losing Control of Your Money

If you’ve been reading our blog for a while, you know that we’re constantly preaching about controlling your cash flow. And you may be wondering, why do I need to control my cash flow and why is that even important? Well, if that sounds like you stick around to the end of this blog because today we’re going to cover why controlling your cash flow is so important and how to regain control of your money.

So, you graduate from college, you get your first real job, and you start saving for retirement in the company 401k, 403b, or other company-type retirement plans. You’re moving yourself forward, or so you think, because you’re saving for retirement. It seems to be the responsible thing to do. Unfortunately, that literally separates us from our money when we need it most, obligates our cash flow towards that retirement, and holds us back. But how does it hold us back? 

Let’s say from the time you start working to the time you retire, you’ve accumulated over $1,000,000. Well, think about this. When you started saving in your twenties, a dollar bought you a dollar of goods and services. But when you retire, it’s not the same dollar. That dollar is worth much less, probably closer to $0.69. So now your million dollars doesn’t have $1,000,000 of buying power, it only has $690,000 of buying power. But it gets worse because now when you take money out of that account, you’re taking it out on the million and you’re taxed on the million. So let’s say you’re in a 25% tax bracket. Poof, there goes another $250,000 of the million dollars. Now you’re down to $440,000. And when you do the math, you might have a net rate of return, net of taxes, and purchasing power of about 1.5 to 2%. Now, what you don’t realize is that in order to get a 6 or 7% rate of return in your retirement account, you had to put your money at risk every single day for over 40 years. 

So let’s summarize or recap exactly what happened. You made the responsible decision to save for retirement in a government-qualified retirement plan. But what you didn’t realize is:

  1. Your money was exposed to the risk of Wall Street. 
  2. Inflation ate away at the buying power of your money.
  3. The government is going to take a big chunk of the money when you take it out in retirement. 

So you’ve separated yourself from your money, from your cash flow. And under the idea that you’re going to move yourself forward. But there are so many forces pulling you back that you don’t see that it’s almost impossible to get ahead financially.

Now, let’s just take a step back. We’re not saying you shouldn’t be saving for retirement. In fact, you should be saving for retirement. But what we’re suggesting is that you save in a place where you have complete liquidity use and control of that money everywhere along the way so that you could reach your financial goals, not just in retirement, but everywhere along the way, because we have to live along the way. And we want you to do that without being dependent on banks and credit cards for access to money or the government rules to access your money or Wall Street to grow your money efficiently. 

When it comes to your monthly cash flow, every decision you make has a ripple effect. So you chose to save for retirement in a qualified plan, but you don’t have access to that money. So what happens when you want to go on vacation, send your kids to private school, do a home improvement, or buy a new car? You’re forced once again to go borrow. And what does that do? It further pinches your cash flow. That’s the ripple effect. And with every ripple you make in your monthly cash flow, it gets harder and harder to save in a place where you have liquidity, use, and control of your money. 

So let’s start with answering the question: Why is controlling your cash flow so important? And to answer that, let’s take a look at all of the ways that the government, Wall Street, and banks systematically get their hands in our checkbook every single month. Oftentimes, they’re in there so much so that we’re not saving for ourselves, for our future, for our families. It’s really simple when you think about it. Financial institutions, large corporations, the government – they have rules. And those rules are really simple:

  1. They want to get our money. 
  2. They want to get our money on a systematic basis. Think about all the monthly subscriptions, the auto pays, etc. that you have where you freely let people in or institutions into your checking account.
  3. They want to keep our money as long as possible. 
  4. When it comes time to give us our money back, pay it back to us over as long a period as possible.

    Those four rules are cardinal to their financial success, and that’s what we say: If it’s important enough for them to implement those rules, then it should be that much more important     or us to follow those rules to benefit ourselves.

Think about the impact it would have on your life and your family if you were to implement those four rules for yourself instead of having them serve the government, banks, Wall Street, everyone else. They could be serving you and you could finally be in control of your cash flow. And that’s why it doesn’t matter how much money you make. It doesn’t matter if you make over $1,000,000 a year or if you make $50,000 a year. If you’re not in control of your cash flow, you’re not in control of your life. It’s really simple. 

The government, financial institutions, Wall Street, and banks, they want to, they need to, separate us from our money. And they do it by convincing us that it’s actually moving us forward. And in the process, they get to control our cash flow, they get to control our money, and ultimately they control our lives. Because one day you wake up and you’ve got retirement deposits, you’ve got car payments, credit card payments, mortgages, home equity loans, you name it. And the next thing you know, your cash flow is pinched and you feel out of control. A lot of times people come to us and they think, “If only I earned more money, I could finally reach all my financial goals. I could finally get some cash flow relief.” But that’s not true unless you start making your money and your cash flow more efficient. The problems are going to continue to compound as your income grows. It’s sort of like you have a bucket filled with holes and in order to fill that bucket with water, you have to first plug the holes. And that’s where we can help you regain control of your money. It’s money that’s literally hiding in plain sight. It’s in your cash flow. You think it’s moving you ahead, and it’s actually holding you back. 

If you’re finally ready to regain control of your cash flow and stop being at the mercy of government banks and Wall Street, be sure to visit our website at tier1capital.com. There’s a free web course that goes through our exact process, step by step. Or if you’re ready to get started, click the Schedule a free Strategy Session button to get on our calendar today. 

And remember, it’s not how much money you make, it’s how much money you keep that really matters.

How To Live Financially Free

Have you met with a financial adviser who turned you away because you didn’t meet their account minimum? Well, today’s your lucky day, because today we’re going to take you through exactly how to go from having nothing or not enough to being abundant and living financially free.

So the first question you should ask yourself is: why don’t you meet their account minimum?

And it’s probably because you’re following conventional wisdom, but that’s the good news – you probably also have money that’s hiding in plain sight. Our process seeks to put you back in control of your money. We do a deep dive into your finances and find money that you’re giving up control of unknowingly and unnecessarily. 

Unknowingly means that you don’t know you’re doing it. You don’t wake up and say, “Hey, I’m going to make a bad financial decision today.” No one does. 

Unnecessarily means that you don’t have to continue down that path. Making some simple shifts within your finances could put you back in control of your money and leave you in a better financial position going forward.

We have been trained to find, on average, $24,000 per year of money that’s hiding in plain sight. That’s money that you can use to move forward financially. Our process looks at five major areas of wealth transfer where money is leaving your control each and every single month. Those areas include:

By looking at these five areas, we’re able to identify money that’s leaving your control. Then we can redirect that money back into an account that you own and control and have full liquidity use of that money in order to achieve your financial goals.

And you see, we don’t have an account minimum. We would never insult somebody by telling them that they’re not good enough. Everyone thinks they’re doing the best that they can with what they have, but what if there was a way to make your money more efficient. What if instead of just paying down debt or paying cash for purchases, you were actually accumulating wealth for you and your family? Wouldn’t you want to know about that? This is where financial advisors get stigmatized as only being there for the wealthy.

But if you’re serious about moving yourself forward financially, we are here to help. If you’d like to get started with our process, visit our website at tier1capital.com to schedule your free strategy session today.

And remember, it’s not how much money you make, it’s how much money you keep that really matters.

Who’s in Control of Your Money?

Are you a millennial saving for retirement in your employer-sponsored retirement plan? Did you know that the average age millennials started saving for retirement was actually between ages 22 and 23? Why? Simple, automatic enrollment. 95% of those enrolled don’t opt out. If you’re wondering if there are better ways to save for your financial goals and retirement, stick around to the end of this blog. 

When it comes to saving for retirement, use your employer-sponsored plan to contribute up to the level that the employer matches. But over and above that, you may want to consider alternatives that put you in control of your money so that you could access that money somewhere along the line. In case there’s a financial emergency, a medical emergency, or an opportunity that you want to take advantage of. 

Now keep in mind that these strategies may be different from the ones that your parents, your grandparents, your mentors, or even your friends are using. 

But they seek to keep you in control of your money because whoever controls your cash flow controls your life. And we have seen too many times people trying to put as much money as possible into their government-sponsored or employer-sponsored retirement plan. And you see, it’s not about having the biggest statement or the largest value on your statement. It’s about being in control of your money. And yes, you might have a large statement or a large balance in your retirement account. But who really controls it? Is that all your money or is part of it controlled by the government? 

And you see, that’s the key. Putting you in control of your money. Have you considered what the taxes are going to be in the future when you go to access that money, or if you have to access it before the government says you’re allowed to? What the penalties are going to be on that money? And you see then this brings us back to the basic question: Do you think taxes are going up in the future? 

Do you think taxes have the potential to go up a lot in the future? Is it better to defer a small amount of tax into the future when it could potentially be a large tax? Or is it better to pay a small amount of tax on your income now and let it grow on a tax-deferred basis so you never have to pay taxes on it again?

So you’re going to always want to contribute up to that employer match. But anything over that, you have a choice. Where is the best place for you to save that money? And that’s where we can help you. We can help you assess where the best place to put the money would be to fit your circumstance. You’re going to want to keep full liquidity use and control of any excess money that you’re saving. You’re going to want to save it in the place that it’s allowed to grow on a tax-deferred basis, and that allows you access to anything you need, no questions asked. So you could use it to renovate your home, go on vacation, send your kids to college, take advantage of opportunities, or anything else you could think of. 

And here’s the point again. You have choices, and keeping those options open allows you to access that money prior to retirement so that now your money is working in two places at once. 

So if you’re enrolled in your employer-sponsored plan and contributing over the match and you’re looking for some alternatives of where you could save, that would leave you in control of your money so that you could access it when you need it for what you need. Be sure to visit our website and schedule your free strategy session today. And remember, it’s not how much money you make, it’s how much money you keep that really matters.

Whole Life Insurance Policy: Planning Your Cash Accumulation

So, you’re purchasing a whole life insurance policy specially designed for cash accumulation, and you’re wondering how much money exactly is going to be available within the policy during those first few years. If that sounds like you stick around to the end of this blog post because today we’re going to do a deep dive and you’ll know exactly what to expect going forward. The first step is understanding how the policy is designed and the three key components.

  • The first is the base policy. It’s the actual whole life insurance policy within your contract. And with that, during the first few years, there’s not going to be much cash accumulation. But that’s why we have the other two components.
  • The second component is the term rider. And with the term rider, we increase the death benefit, but it allows us to put extra cash within the policy.
  • And the third piece is a paid-up additions rider. And that’s where the actual cash value is growing, in that paid-up additions rider. 

So again, the three components are: the whole life policy, which allows us to do all of this magic, the term rider, which allows us to stuff more money into the policy, and then the paid-up additions, which are actually the equity that we get in the early years. 

And it could be thought of as a single premium whole life policy under the cover of a term policy within the whole life policy. So, as we mentioned earlier, the base policy and that term rider, they’re not going to have much cash availability within those first few policy years. But with the paid-up additions rider, the amount that you’re contributing to the rider on a monthly or annual basis, you can expect about 85 to 95% of that to be available immediately for access via policy loan. You see, that’s the money you could access to pay off debt, make a major capital purchase like a car, a wedding, a vacation, or use to take advantage of an opportunity that presents itself. 

So, here’s the key: With or without the riders, the paid-up additions, and the term rider, the whole life insurance policy would eventually become efficient. After the first few years, that base policy is going to become efficient and generate cash value within itself on a guaranteed basis. But, the paid-up additions rider allows us to supercharge the policy so you have immediate access to cash value. 

And keep in mind, when Nelson Nash discovered the infinite banking concept, there was no such thing as paid-up additions riders. So, he was looking at it purely from a perspective of a base policy, and he was starting policies out that had no cash for two or three years. And that’s the key. He was thinking long-term.

You see, this is a long-term concept that will put you in control of your money, your cash flow, and, ultimately, your life. So walk away from this blog knowing this, you’ll have access immediately to 85% to 95% of whatever you’re contributing to that paid-up additions rider, whether it’s on a monthly basis, an annual basis, or a one-time jump in. But also keep in mind that the longer you have the policy, the better it gets. And because of that, over time, you’ll have access to more and more of the money you put in, as well as the earnings on that money. 

Additionally, you have to keep in mind that as that base policy matures, the paid-up additions rider may not make sense anymore. So you’ll want to look at this in a few years. And then once we drop that paid-up additions rider, you may want to start a new policy and begin this process all over again. 

If you have a policy and you’re wondering how to access the cash or what the growth is like within it, be sure to visit our website at tier1capital.com. Also, if you don’t have the policy and you’re thinking about starting one, we’d be happy to help. You can schedule your free strategy session at tier1capital.com today.

And remember, it’s not how much money you make, it’s how much money you keep that really matters.

Do You Have Money Hiding In Plain Sight?

Today we’re going to share with you ideas and strategies that transcend finances. It will be information that can impact your life on a much bigger and deeper level than just financially. Implementing these strategies can give you back control of your money, your cash flow, and your life. No longer will you be dependent on and therefore obligated to the banks for credit and access to cash. No longer will your financial success be tied to the vagaries and whims of the Wall Street rollercoaster. So if you want to get back control over your life and experience the liberating feeling of independence and freedom that come with it, stick around to the end of this blog to find out.

Today we’re going to talk about the concept of money that is hiding in plain sight. And you may be wondering: “How could money be hiding in plain sight? Every day I wake up, I make the best financial decisions for myself. I pay off my debt as soon as possible. I have a 15-year mortgage and I’m paying extra on it. I’m paying off my credit cards as fast as I can. I’m maxing out my 401K’s. I’m paying cash for purchases when I can. I’m saving for my children’s college education.”

But what if we were to tell you that the things you’re doing could actually end up holding you back financially in the long run? When would you want to have that conversation? 

So, let’s start with a simple example of having $500 extra at the end of the month and making the decision to put $500 on your credit card. Why? Because debt is bad. And the first question you need to ask yourself is that by putting that extra $500 on the credit card, does that increase or decrease your net worth? The answer is neither. You see, before you put the money on the credit card, you owned and controlled $500 and you had the outstanding balance on the credit card. Now you have a lower outstanding balance by $500, but no cash. It hasn’t impacted your net worth by one penny. But the key is now who controls that $500? And the answer is, it’s not you. That’s just one example of where you could be giving up control of your money unknowingly and unnecessarily. 

We found that there are five major areas of wealth transfer: taxes, how you fund your retirement, your mortgage, how you’re saving for your children’s college education, and how you’re making major capital purchases like weddings, vacations, or buying a new car. And, you see, this money is actually hiding in plain sight. And what we have found is that the average family has about $24,000 year over year that is hiding in plain sight. Again, it’s money you think is moving you forward. It’s actually holding you back. And because of that, we’re able to identify that money and return it to you so that you can be in control of that money.

Let’s face it. No one wakes up in the morning and says, “Hey, how can I mess up my finances today?” We’re making decisions that we think are right for us because that’s what conventional wisdom told us, or that’s what our parents told us, or that’s what our grandparents told us. But we’re here to tell you that there may be a better way that leaves you with more control of your finances so that you’re less dependent on these institutions going forward. And you see, that’s the key to putting you back in control of your money. Once you start chasing returns or looking at interest rates, you’ve taken your eye off the ball. And that’s where we could find the money that’s hiding in plain sight.

Now, finding the money is only step one. And if you find the money and you just increase your lifestyle or you increase your spending, that’s not going to move you forward either. The second part of the equation is to start saving that money and to start saving it in a place where you own and control it so that you’re able to make better financial decisions going forward and be less dependent on these institutions in the long run.

And you see, we have found that a specially designed life insurance policy will give you access to your money when you need it, no questions asked. So that’s the first issue of control. The second issue is that by accessing that money and using the loan provision now, your money will continue to earn uninterrupted compounding interest. And now that’s the second level of control that returns back to you. And again, what could be more empowering or more liberating than setting up an account that only you could access and you can use for whatever you want, whenever you want. That, to us, is control.

You see, when you’re in control of your money, you’ll have less dependency on banks for access to credit, and you’ll have less exposure to the risks of the Wall Street rollercoaster. If you’d like to get started in finding the money, hiding in plain sight in your finances, be sure to visit our website at tier1capital.com to schedule your free strategy session today. And remember, it’s not how much money you make, it’s how much money you keep that really matters.

How To Get The Most Out Of Your Retirement Savings

Did you ever think about what would happen to your retirement nest egg if you happened to retire during a down market? Everyone knows the cardinal rule: never do a double negative. Never take money out of your investment account during a down year. But where does that money come from if it’s not coming from your investments? Stick around to the end of this blog to find out.

Will you be retiring in a down market? Keep this in mind. Since 2009, the market’s been only down once, and that was 2018 when the market was down about a little over 4%. Now, the average bull market lasts seven years. But here we are 13 years later and the market’s still chugging along. So the question again is, will you be retiring in a down market? Now, conventional wisdom tells you to either invest in safe assets if you’re concerned about a down market or to balance your portfolio. Maybe 40% bonds and 60% stocks or 60% bonds and 40% stocks. But they don’t tell you what happens if the bond market is down at the same time the stock market is down.

Here’s a question, where is it written that you have to lose 50, 60, 70% of your portfolio in order to earn money? Why not choose an asset that’s not correlated to the stock or bond market? So that you’ll get a reasonable rate of return and you’ll have liquidity, use, and control of that money so you could access the cash to supplement your retirement income when there’s a down market giving your portfolio a chance to regenerate or to regrow itself without having the double negative of a market loss and an annual withdrawal. 

The point is that conventional portfolio solutions have downsides, and those downsides can be detrimental to your nest egg. A better solution may be using a specially designed whole life insurance policy as a volatility buffer to protect your nest egg so you don’t have to make a withdrawal in a down year ever again. It allows your portfolio to regenerate itself, to grow back, and it still gives you the income you need in retirement.

We’re going to take a look at why you would want to utilize cash value life insurance as a volatility buffer to supplement your portfolio. Let’s say you have a hundred-dollar portfolio and your portfolio loses 20%. Well, now you’re down to $80. But did you ever think how hard you have to work on that $80 in order to get back to even? You lost 20%, but you got to earn 25% of the $80 in order to get back to $100.

Now, let’s throw in taking money out of the portfolio to supplement your retirement. You have the same hundred-dollar portfolio, the same 20% loss. Now you’re down to $80, but you take out $10 to supplement your retirement income. Now you’re down to $70. You have to earn 42% on the $70 just to get back to even. As you could see your money has to work that much harder just to get back to even or else you’re going to run out of money faster. Here’s the key, make sure your money is working smarter, not harder. Using a specially designed whole life insurance policy as a volatility buffer is a great way to get the most out of your retirement savings.

If you’d like to get started with a specially designed full life insurance policy for accumulation as a volatility buffer in your situation, be sure to visit our website at tier1capital.com to get started today. Feel free to schedule your free strategy session. And remember, it’s not how much money you make, it’s how much money you keep that really matters.