Cash Fluency

The Key to Financial Control: Why Cash Flow Matters More Than Rate of Return

In America, we tend to view our financial lives in terms of “money in, money out.” You go to work, earn money, and then use that income to pay bills. It’s a cycle most people are familiar with. However, when we’re taught about finances, the focus is often on the rate of return—how much interest can be earned on savings or investments. But here’s the problem: if your cash flow is inefficient, there won’t be anything left to save.

That’s what we’re discussing today—the difference between cash flow and rate of return, and why optimizing your cash flow might be the most important financial move you can make. At Tier 1 Capital, we’ve dedicated ourselves to helping people regain control of their money, and our approach focuses on cash flow, not just rate of return.

Here’s the simple truth: you can’t spend rate of return. Cash flow, on the other hand, is the lifeblood of both your family and your business. When you focus on cash flow—and more importantly, maintaining control over it—you gain clarity and confidence in your financial decisions. Rate of return is unpredictable and often involves locking up your money, making it inaccessible when you need it most. But when you focus on cash flow, suddenly, a world of possibilities opens up.

One of the biggest areas where we help families and businesses is by analyzing their current cash flow. Many people have inefficiencies in their financial systems—money leaks, so to speak. These are like holes in a bucket where cash slips through your hands each month without you even realizing it. Our goal is to plug those leaks, even if it’s just a small amount at a time, so your money stays in your control.

Think of it this way: when you plug the holes, less money leaks out. Now, that money remains with you, building up over time and becoming available for future purchases or investments. The key is to make that money work for you, not for financial institutions, advisors, or large corporations.

We all know the importance of saving, right? No matter how much you’re saving—whether it’s 5%, 10%, or 20%—there’s always a sense that you should be saving more. And that’s even harder today with rising inflation and interest rates. So how do you maintain a manageable cash flow while still saving for the future? By identifying inefficiencies in your current system and redirecting that money to a place where you have liquidity, use, and control over it.

Once you start building up a pool of cash, you gain options. You won’t need to rely on high-interest credit cards (which can have rates of 30% or more!) or take out loans with unfavorable terms. You’ll have something in your back pocket—a financial safety net that you’ve built and can leverage when needed.

At Tier 1 Capital, we recommend placing that money into specially designed life insurance policies, structured for cash accumulation. Why? Because not only does your money continue to grow with compound interest, but you can also borrow against the policy at much lower rates—currently around 5.5% to 6%. Compare that to today’s mortgage rates, which are often over 7%, or even home equity lines of credit that can go up to 9.5%.

The real advantage of these policies? They offer flexible, unstructured loan repayments. When you take a policy loan, there’s no strict repayment schedule. Yes, you should pay back the interest annually, but beyond that, you get to decide how and when you repay the loan. If you’re used to paying a fixed amount to a credit card company each month, you can now direct those payments toward your policy loan—and if you have extra cash flow, you can repay it faster. The faster you pay it back, the quicker you can borrow against it again.

This structure allows you to stay in control of your cash flow on multiple levels, making your money work for you in the most efficient way possible.

If you’re interested in learning more about how this process can work for you, your family, or your business, visit our website at tier1capital.com, where we offer a free web course on cash flow management.

Remember, it’s not about how much money you make—it’s about how much you keep. And that’s what truly matters.

Life Insurance Dividends vs. Investment Dividends: What’s the Smarter Choice for Growing Your Wealth?

When you’re talking about whole life insurance with a mutually owned life insurance company, it’s natural that you’ll talk about dividends, and you may be wondering, what exactly is a dividend and how do life insurance dividends differ from investment dividends? And that’s exactly what we’re going to cover today.

Now, there are some key distinctions between life insurance dividends and investment dividends. What exactly are they? So an investment dividend is literally a distribution of profits from the company to its shareholders, and those dividends are taxable. Those distributions are taxable. Now, a dividend in life insurance is literally a return of overpaid premium, and as such is not taxable. So that is a key huge distinction, right? And that’s why we always talk about paying taxes, income tax on the premiums. You never want to take a deduction for your life insurance premium, even if you’re using it for business purposes, because that would mess everything up in the sense that if you take the deduction on the premium payments, then your death benefit, that big pool of money that’s going to go to the beneficiary, will end up being taxable. So it’s important to make sure that all your ducks are in a line all along the way to make sure you’re getting the most bang for your buck when it comes to the benefits of life insurance.

You know, and that brings up a good point. The premium is the small contributions you make to get the huge death benefit. So if the premium is deductible, the death benefit is taxable. You don’t want that. So by paying the premium with after-tax dollars, that allows for the tax advantages of the large amount, the death benefit. But let’s get back to dividends. Why are dividends important? Well, real simply, dividends in life insurance enhance your cash value growth. Now again, the dividends are a refund of overpaid premiums. But think of it this way, that refund is technically a profit. And understand that if you buy a policy with a mutual insurance company, you are the owner of the company as it relates to your policy.

And think about it this way: with the whole life insurance policy, there are actuaries that design and engineer these policies, right? And we all know that engineers overestimate, and that’s why we have the dividends built in, right? So when you see an illustration, you’ll see those guaranteed numbers—the worst-case scenario. As in, if there were no dividends paid to that policy ever, this is what you would have—the worst case, correct? And then there’s another illustration in there, and that’s usually based on the current dividend rate. What would happen if we earned the 2024 dividends or 2025 dividends every single year perpetually going forward? How would the policy perform?

And I think another thing we need to touch on here is it makes the most sense to have those dividends reinvested into the policy using paid purchasing, paid-up additions, right? So with that, the dividends go and purchase a small chunk of death benefit that’s not going to have any more ongoing premiums. And so you’re able to earn interest on those dividends that you’ve earned, and it increases your dividends going forward, right? So think of it—you’re earning interest on your dividends and dividends on your dividends. And this thing just continues to snowball and really build long-term value. And that’s the key. Remember we said you’re the owner of the company as it relates to your policy. Well, those profits are smaller in the beginning, in the early years, and much larger in the later years. So the longer you have the policy, the more dividends you’ll receive, the greater those dividends will be, and the greater the compounding.

And that makes perfect sense when you think about the design of a life insurance policy, right? Because when you purchase a whole life insurance policy, the insurance company is making you two promises. The first is to pay that death benefit out if and when the insured dies anywhere along the way, and the second is to have a cash value equal to that death benefit at the age of maturity, which is typically age 121. But that’s really key. They’re actually designed to increase in cash value on an exponential basis, on a guaranteed basis, even over time as that policy matures. So if you add dividends on top of that, it makes it go even faster and faster and makes this machine as efficient as possible, especially as that policy ages.

Exactly. But now let’s talk about one key feature of dividends, and it’s real simple: they are not guaranteed. Dividends are not guaranteed. So keep this in mind. That’s why when you get your illustration, there’s two columns: there’s the guaranteed numbers with no dividends, and then the current numbers, which include dividends at the current rate the insurance company is paying out. Dividends. Now two things need to be addressed. Number one, the guarantees are the worst-case scenario. And number two, the numbers you see on the non-guaranteed with dividends is guaranteed to not be that number. It’s funny. So you get these two illustrations, and you know you have the worst-case scenario, you have the current-case scenario. Neither of them are going to be true. They’re just meant to give you an idea of what those cash values could look like over time. But another key we need to remember here is that the only dividends that aren’t guaranteed are the ones that haven’t been credited yet. Once your policy earns a dividend, there’s no risk of losing that dividend, that cash value, that death benefit associated with those paid-up additions. There’s no risk associated with it from the market, even if, you know, the insurance company never pays another dividend again. The dividends that you’ve already earned are yours, and you get to keep those.

So understand a few things here. Number one, dividends are not guaranteed. But if you’re buying a policy with a mutual insurance company, most mutual insurance companies have been around for over 150 years or so, paid dividends for over 125 consecutive years—that’s through world wars, depressions, gas shortages, you name it. So those dividends, again, aren’t guaranteed, but the probability is the company will pay something. It may not be what they’re projecting, but they will pay something. And the other thing is that as the owner of the policy, you get to choose how your dividend is allocated. You can use it to reduce premiums, you can use it to be paid in cash, you can use it to purchase paid-up additions or paid-up life insurance. So there’s a lot of different ways you can allocate your dividend, and that’s your contractual right.

Now, when we talk about whole life insurance designed for cash value accumulation, dividends are a key feature. Thanks so much for watching our video, and remember, it’s not how much money you make, it’s how much money you keep that really matters. We’ll see you in the next one.

Life Insurance Dividends vs. Investment Dividends: What’s the Smarter Choice for Growing Your Wealth?

When discussing whole life insurance with a mutually owned life insurance company, dividends naturally come into the conversation. You might wonder, what exactly is a dividend and how do life insurance dividends differ from investment dividends? That’s exactly what we are going to cover today.

There are some key distinctions between life insurance dividends and investment dividends. An investment dividend is a distribution of profits from a company to its shareholders, and these dividends are taxable. However, life insurance dividends are a return of overpaid premiums and are not taxable. This is a crucial distinction.

One reason we always talk about paying income tax on the premiums is that you never want to take a deduction for your life insurance premium, even if it is for business purposes. Doing so could lead to your death benefit—the large sum of money that goes to the beneficiary—becoming taxable. It’s vital to ensure that everything is aligned properly to get the most out of life insurance.

The premiums you pay are small contributions towards the huge death benefit. If the premiums are deductible, the death benefit becomes taxable, and you don’t want that. By paying premiums with after-tax dollars, you maintain the tax advantages of the death benefit. Dividends, on the other hand, are used to enhance your policy’s cash value growth. Although dividends are technically a refund of overpaid premiums, they can be seen as profits because if you have a policy with a mutual insurance company, you essentially become an owner of the company.

With whole life insurance, policies are designed by actuaries, who typically overestimate the amount needed, which is why dividends are built into the policy. When you see an illustration, you’ll notice two sets of numbers—the guaranteed figures representing the worst-case scenario (if no dividends were ever paid) and another set based on the current dividend rate, showing how the policy could perform if dividends are paid consistently over time.

Reinvesting dividends into the policy by purchasing paid-up additions is a smart strategy. This allows you to earn interest on the dividends, which in turn increases future dividends. Over time, this compounding effect builds long-term value, with dividends being smaller in the early years and much larger in the later years.

Life insurance companies make two promises with a whole life policy. First, to pay out the death benefit when the insured dies, and second, to have the cash value equal to the death benefit by the policy’s maturity, which is usually age 121. As the policy matures, the cash value grows exponentially. If you add dividends into the mix, this process accelerates, making the policy more efficient over time.

One key thing to remember is that dividends are not guaranteed. When you get your policy illustration, the figures showing the dividends are based on the current rate, which is subject to change. However, once a dividend is earned, it’s yours—there is no risk of losing that dividend or the associated cash value, even if no future dividends are paid.

Although dividends aren’t guaranteed, many mutual insurance companies have been paying dividends for over 125 consecutive years, even through significant events like world wars, depressions, and economic downturns. While the dividend projections may not always be met, companies generally do pay something.

As the owner of the policy, you have the contractual right to choose how your dividends are allocated. You can use them to reduce premiums, take them as cash, or purchase paid-up additions.

If you’d like to learn more about how to apply this process to your business, family, or personal finances, visit our website at tier1capital.com. We’d love to speak with you in a free strategy session.

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

Mastering Cash Flow Management: How Small Business Owners Can Regain Control and Increase Profits

When you own your own business, it’s common to want to expand that business as quickly as possible. Business owners often reinvest their profits into inventory or expanding the business in any way possible because hypothetically, the more money they put in, the more they can get out. It contributes to financial freedom. Today, we’re discussing how to make that cash flow as efficient as possible because, ultimately, every purchase we make is financed.

Keep this in mind: cash flow is the lifeblood of any business. According to our research, 61% of small business owners around the world struggle with chronic or cyclical cash flow issues. What we’ve found is that most of these cash flow issues are self-inflicted. It’s how business owners manage their money that holds them back.

Here’s the key: we finance everything we buy, whether it’s inventory, equipment, or even employees. We’re either going to borrow money and pay interest, or we’ll pay cash and give up interest that we could have earned.

Most people try to avoid paying interest because they see it as a loss. However, they often overlook the interest they’re giving up by paying cash. This causes a mistake when business owners pay cash for things they could otherwise finance. The same goes for paying off debt too quickly—this practice sacrifices cash flow and control at every turn.

What happens when business owners give away their cash flow by paying off debt or paying cash for things is they eventually find themselves needing to borrow money down the road. Why? Because they gave away their profits and now have no capital reserve to access when necessary.

This leads to what we call the “debt cycle.” Chronic and cyclical cash flow issues arise when businesses give away control of their cash flow, leaving them without a financial safety net when problems arise.

A cash flow issue is simply a symptom, not the root problem. Most people approach it by either reducing expenses or increasing revenue, but both come with costs. For example, reducing marketing expenses can lead to a dip in revenue. However, cash flow issues really stem from not understanding the bigger financing picture.

If businesses manage financing more efficiently, they gain better control over their cash flow. That’s the goal: more control over your cash flow and assets.

In our practice, we examine every financial decision through the lens of control. Does this decision give you more control over your cash flow and assets, or less? The goal is to have as much control as possible because control leads to freedom and opportunity.

When you have options, you can choose to borrow from yourself, from the bank, or pay cash. But it’s critical to make these decisions in the most efficient way possible—where you are in the greatest control of cash flow and assets.

Conventional financing methods send the velocity of your money away from you, your business, and your family. The money flows outward, and you lose control of it. However, with our process, we start taking back control of some of that money’s velocity, keeping it in an entity you own and control. This allows you to leverage and reuse that money in the future.

You’re still making the same purchases and investments in your business, but now you control the process, ensuring that some of the cash flow returns to you. As a result, the next time an opportunity arises, you have a pool of money to draw from, ensuring that your cash flow is constantly circulating back to you.

The key is that you’re still making purchases, but now the money flow comes back to you, putting you in complete control. It’s a huge difference.

If you’d like to learn more about how to apply this process to your business, family, or personal finances, visit our website at tier1capital.com or download our free business owners guide. We’d love to speak with you in a free strategy session.

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

How Whole Life Insurance Builds Wealth, Grows Tax-Free, and Creates a Financial Legacy

When people think about life insurance, they often focus on the death benefit. But whole life insurance, especially designed for cash value accumulation, offers much more. It helps build wealth in the present, grows for the future, and ultimately creates a lasting legacy. One powerful tool in this process is dividends.

Dividends are a portion of the profits that mutually owned life insurance companies return to policyholders. If you own a policy with a mutual insurance company, you are essentially part-owner. The company’s profits come back to you as dividends, which are a return of overpaid premiums and are not taxable. If you reinvest these dividends into paid-up life insurance, your cash value compounds, growing even more over time.

Whole life insurance policies come with two guarantees: a death benefit and cash value that matches the death benefit by the policy’s maturity (usually at age 100 or 121). Insurance companies have to stash away more cash each year, so your policy naturally becomes more efficient, accumulating cash over time. You have access to this growing cash while still alive, a portion of the death benefit that you can use.

For policyholders with a mutual insurance company, dividends are an added advantage. These profits, combined with guaranteed growth, boost your policy’s efficiency. As long as the money stays in the policy, it grows tax-free, and you can access it via policy loans without interrupting the policy’s growth.

Insurance companies generate profits in three areas: mortality savings (fewer policyholders dying than expected), expense savings (overestimating operating costs), and interest earnings (earning more on investments than estimated). All these factors contribute to the dividend pool. Focusing solely on the dividend interest rate can be misleading—it’s just one part of the equation.

Reinvesting dividends creates perfect compounding. Your dividends generate more dividends, fueling continuous growth. You can access the growing cash value for retirement income, investments, or other needs, all while maintaining the policy’s growth. Additionally, your death benefit increases, allowing you to leave a larger legacy for your family, charity, or business, all tax-free.

Whole life insurance is a flexible, powerful tool for building wealth and securing your future. It grows a pool of cash you can use and leaves a tax-free legacy for your loved ones. If you’d like to explore how this can work for you, feel free to schedule a free strategy session at Tier 1 Capital. We’d be happy to help you take control of your financial future.

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

Why Whole Life Insurance is Essential for Wealth Building, Tax-Free Retirement and Legacy Preservation

When we think about financial assets, we often categorize them into three types: current assets, accumulation assets for the future, and legacy assets for passing on wealth. However, whole life insurance, specifically designed for cash value accumulation, can function as all three—current, accumulation, and legacy—simultaneously.

As a current asset, the cash value of your whole life insurance policy can be accessed at any time. You can borrow against it to pay off debt, invest in opportunities, grow your business, or handle immediate needs. This makes it a flexible financial tool that allows you to address today’s issues while keeping your long-term goals in mind. Unlike a traditional savings account, where you may lose out on interest when you withdraw funds, whole life insurance allows your money to continue earning uninterrupted compound interest while you borrow against it. Plus, it offers additional benefits like protection through a guaranteed death benefit.

As an accumulation asset, whole life insurance also serves as a long-term strategy for building wealth. Over time, your monthly or annual premiums accumulate in value, and the dividends and interest earned inside the policy grow your cash value. This provides a reliable way to supplement your retirement income on a tax-favored basis. You can withdraw the amount you’ve paid in premiums tax-free and borrow against the accumulated interest without triggering taxes. This setup helps avoid common tax liabilities that erode retirement income, such as federal and state income tax, Social Security offset taxes, and increased Medicare premiums.

Finally, whole life insurance acts as a legacy asset. When you pass away, the death benefit provides a significant sum to your beneficiaries—whether it be family, a business, or a charitable organization. This explosion of value far exceeds the amount paid in premiums and helps recapture the interest paid over the years through policy loans. In essence, whole life insurance allows you to make your money work in three different ways: as a current asset, a deferred asset for future use, and a legacy asset for your loved ones.

Incorporating whole life insurance into your financial strategy offers unmatched efficiency and control. If you’d like to learn more about how to use this strategy for your unique situation, visit our website at tier1capital.com and schedule a free strategy session.

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

Mastering Financial Freedom: Overcome Inflation, Debt, and Cash Flow Challenges

In today’s financial climate, many people feel the pinch as inflation reaches unprecedented levels, while salaries fail to keep up. It’s becoming increasingly difficult to manage your finances, especially after experiencing a period of “lifestyle inflation“—where spending habits increased during a time of economic boom, only to be met with the harsh reality of rising costs. This post aims to offer some relief and guidance on how to regain control of your finances amidst these challenges.

Inflation has surged by 18.6% over the past three years, while savings have plummeted by 37%. This stark contrast highlights the financial strain many are experiencing. The double whammy of dealing with both rising living costs and credit card debt, combined with contributions to retirement accounts, has left many feeling trapped. This scenario creates what we call a “double death”—a situation where your money is locked away in retirement accounts, making it inaccessible when you need it most, and at the same time, high-interest credit card debt eats into your cash flow.

Credit card debt in America is at an all-time high. The cost of living is forcing many to rely on credit just to get by, leading to a vicious cycle of debt that seems impossible to escape. Credit card interest rates can range from 20% to 35%, which means a significant portion of your payments goes toward interest rather than reducing the principal balance. This system is designed to keep you in debt, obligating your future income for purchases made today at a steep cost.

What we propose is a shift in mindset—regaining control of your cash flow and, ultimately, your life. Being heavily in debt means you’re not in control, and this financial stress can affect every aspect of your life, including your sleep. Studies show that a significant percentage of small business owners worldwide lose sleep over cash flow concerns, underscoring the pervasive nature of this issue.

Many cash flow problems are self-inflicted, often resulting from how we use our money. The combination of credit debt and retirement contributions is a prime example. Instead of the simplistic approach of redirecting all available cash flow to pay off credit card debt, which leaves you with no access to money and forces you back into borrowing, we suggest building a pool of cash that you own and control. This approach provides a safety net, allowing you to pay off debt while still having funds available for emergencies.

Building this financial safety net is key to navigating life’s unexpected expenses. By having access to capital, you gain the freedom to choose whether to tap into it, reducing your reliance on credit and giving you more control over your financial future. The strategies we often use may seem admirable—saving for retirement and getting out of debt—but when done simultaneously, they can leave you feeling just as pinched as before. By adjusting your approach, you can transition from feeling financially stuck to gaining more control almost overnight.

Ultimately, it’s about shifting your perspective to ask, “Am I putting myself in more control of my money or less?” This is the lens through which we help our clients view their cash flow, guiding them toward greater financial freedom. If you’re interested in learning more about how we implement this process for our clients, visit our website at tier1capital.com, where we offer a free web course that delves deeper into these strategies.

Remember, it’s not about how much money you make—it’s about how much you keep that truly matters.

Financial Strategies to Benefit From Inflation

In today’s economy, the reality is that our dollar is never going to be worth more than it is today. Inflation acts as a stealth tax, eroding the purchasing power of your money over time. In this post, we’ll explore how to regain control of your money and position yourself to take advantage of inflation rather than becoming its victim.

Inflation has surged by 18.6% over the past three years. To put that into perspective, something that cost $100 three years ago now costs $118.60. This means your money will never be worth more than it is today. Consider this: if you buried $10,000 in your backyard and dug it up 10 years later, it would still be $10,000, but its purchasing power would have significantly diminished.

The most valuable dollar you own is the one you have today. When you maintain control of your money, you can position yourself to benefit from inflation rather than fall prey to it. Having access to liquid money opens up opportunities that wouldn’t be available if your funds were locked away.

Three Strategies to Regain Control of Your Money

  1. Opt for a 30-Year Mortgage:
    Instead of focusing on paying less interest with a 15-year mortgage, choose a 30-year mortgage to prioritize cash flow over interest rate. This approach allows you to keep more of your money under your control.
  2. Avoid Extra Payments on Your Mortgage:
    If you have a 30-year mortgage, resist the urge to make extra payments. Use that money to build a pool of cash that you own and control. This will give you more flexibility and options in the future.
  3. Limit Retirement Contributions to the Employer Match:
    Contribute to your retirement account only up to the employer match. There’s no guarantee that the dollars you contribute today will have the same buying power when you withdraw them in retirement. Instead, focus on maintaining control of your money now, when it’s most valuable.

If you have high-interest credit card debt, it’s wise to prioritize paying it down before making excess contributions to retirement accounts. High-interest debt can erode your financial stability, so focus on controlling your cash flow and eliminating debt before locking away funds in retirement accounts.

By implementing these strategies, you can regain control of your money and your life. Remember, whoever controls your money controls your life. The more control you have, the more financially free you will be, with options and opportunities at your fingertips.

If you’d like to learn more about how we can help you regain control of your finances, visit our website at tier1capital.com to schedule a free strategy session. Remember, it’s not how much money you make but how much money you keep that really matters.

Money Management Tips: Regain Control Of Your Cash Flow

If you have been following our blog post, you know that we are constantly talking about the importance of you being in control of your money or regaining control of your money. So why is it so difficult to accomplish despite it being a very simple concept? Today, we are going to talk about the unintended consequences that result from following traditional or conventional wisdom when it comes to your finances and how to regain control of your money by just knowing these things.

Now there are three main institutions that are trying to gain control of our cash flow on a monthly basis: the banks, Wall Street and the government. It is like a game to them in the sense that they set the rules. These rules are:
1. Gain control of as much of our money as possible.
2. Get that money on a systematic basis, meaning they want their hands in our checkbook every single month.
3. Hold on to or control that money for as long as possible.

We are going to take a look at how Wall Street gets us to act in their best interest. By following the rules that benefit them. Firstly, they want to take control of our money. So how do they do that? They will tell you that the only chance you have to beat inflation is to be in equities. They tell you that you have to be in it to win it. They tell you to employ strategies like dollar cost averaging. That’s how they get us to do things on a systematic basis. Also, they tell you that the higher the risk, the higher the reward. So these are things that they tell us to get us, to play the game by their rules so that they could win. Secondly, when the market is down, they tell you that you can’t sell now because you are going to be locked in losses. But when the market is up and you say, “Hey, I wanna sell because I think we made a pretty good profit”. They will say, “Geez, I don’t want you to miss out on this profit”. Plus if you sell now, you have to pay taxes on the gains. So if you don’t sell low, because they don’t want you to lock in losses and you don’t sell high because they don’t want you to pay taxes or miss out on a run, then, when do you sell? Well for Wall Street’s benefit, they never want you to sell.

You see, their job is to get you in the market and keep you in the market at all costs because that is what benefits them, but it doesn’t necessarily benefit you.

 

Now, how do the banks get us to do what’s in their best interest? Let’s take a look at the rules again. Rule number one is they want to get our money. So when it comes to a mortgage, we want to put a downpayment as high as possible. Because with a lower loan or a lower mortgage, you will pay less interest. Rule number two, they want to get our money on a systematic basis. So they will entice us with lower interest rates on shorter term mortgages. For example, a 15 year mortgage will have a lower interest rate than a 30 year mortgage. Rule number three,  they want to keep our money for as long as possible. So with the 15 year mortgage, we’re giving up more of our monthly cash flow to the bank. Even though we’re paying them less interest, we’re still losing control of that monthly cash flow. With the home equity, they tell us that it’s our home equity as if we have control of it and that we are more secure when our house is paid off. But in reality, we don’t have access to that money unless they give us permission to access that home equity. So who’s really benefiting from a shorter mortgage, us or the banks? The answer is clear. The banks are following the three rules and they are in control of our money by positioning it as if we are in control and that it is in our best interest.

Finally, the government gets us to play the game by enticing us to invest in retirement plans for our future. They give us a tax deduction on a small amount of money today so that money can grow on a deferred basis and then they have the potential to tax us at a much higher rate in the future.Think about it, you are putting money away today for a small tax deduction, but in the future, the government determines how much of that money you get to keep. Even if you earn a decent rate of return over many years, you don’t know how much of that money is actually going to be available to you to fund your retirement lifestyle. The government gets us to play the game, but they are also consulting with Wall Street and the banks to create the rules. Who else benefits when we participate in retirement plans? Wall Street, because they get to hang onto our money until 59 and a half, or we pay a penalty and tax. Secondly, the bank’s benefits because if we’re maxing out our retirement account contributions, that means our money is tied up. When the time comes that we have to pay for our children’s college education or buy a car or go on vacation, we don’t have access to our money as it is tied up in retirement accounts or home equity. Therefore we have to borrow more money and who benefits when we borrow more money? Obviously it’s the banks.

Now that  we have  looked at how the government, Wall Street and the banks get us to follow their rules so that they can win and can be in control of our money, what’s the alternative that is not following their conventional financial advice?

The alternative is to save in a place where you have full access and control of your money. A place where your money could grow on a continuous compound interest scale and never be interrupted even after you spend the money. We accomplish this by saving in a specially designed whole life insurance policy, where we get to control our money, where we have full liquidity use and control and access to our cash value for whatever we want, whenever we want. So that we will not be forced to go to the banks to borrow and give up control of our monthly cash flow.

If you’re interested in learning more, book your free strategy session today  to know exactly how we can accomplish this. Remember it’s not how much money you make. It’s how much money you keep that really matters.