Infinite Banking Vs Buy Term and Invest the Difference

[picapj71]

I would hardly call permanent insurance "crap." Traditional whole life factors the cash value into the death benefit, so if you have 25,000 cash value in a 100,000 policy and you die; it pays out 100,000 tax free to your beneficiary. The big question is what happened to the 25,000? I say; you bought 1 dollar bills for 25 cents! Permanent life insurance is the foundation of any good financial plan. Dave Ramsey never talkes about risk and unisurabilty when the term runs out.

[Blackfeetbudz]

At what point do you get what you paid for the cash value?

[ParadigmLife]

There is also a updated version of the buy term invest the difference concept available on our you tube page...

[ParadigmLife]

The statement of cash value not being paid at death comes from a lack of understanding of how permanent insurance works. True, cash value does not bequeth at death, however the death benefit does and is always higher than the cash surrender value.Thanks for your input and being willing to share!! I agree whole heartedly with one of the posters. Read Becoming Your own Banker and a Path to Financial Peace of mind to understand the concept more clearly before making an absolute conclusion.

[ParadigmLife]

16 years is a great track record, especially given what occured in 2008-2009. Impressive! Would you mind naming the fund in question so I may do some due dilligence? Nonetheless, most dividend paying mutual companies have over 100 years of track record paying dividends. Most "agents" who are in this industry selling this system were once in securities, mutual funds, stocks and the whole buy term invest the difference mentality. We are not your checkered pants and 3 inch thick glasses types...

[ParadigmLife]

To put things in perspective, I used 1.5% as the management fee, the average is much higher, over 2%. Life insurance cash value grows tax deferred but is withdrawn on a first in first out basis. In other words your basis is withdrawn tax free and when you get to the point of basis, you may use the loan provision to withdraw which makes all withdrawls tax free. We are in the US not Canada where the rules may be different tax wise.

[ParadigmLife]

There are some good comments here. A healthy argument is always good. A few things: The accumulation side of things is one facet of the Infinite Banking Concept. Please check out our video called Infinite Banking utilization for the other perspective. Now to answer a few of the questions comments. There are cheaper term policies. This is just a software I had handy. However, term is still an expense.

[jakey137]

jgilles your right. it is funny how the taxes on investments are included in the model but not taxes on the profit associated with the cash surrender value. Also just about everybody has the ability has access to a tax advantaged retirement account. What happens to your life insurance when you can't afford the payments. 17,500 at 7.5%, over 30 years, 30% tax gets you 1,250,000. instant 3 mil coverage and higher liquid value all the way along. after accounting for taxes on the CV is 1,160,000

[ryanamur]

Is this a joke? OK you can get a $3M Term-35 policy for a male for less then $3,000 per year in Canada. That's $17,000 in savings a year. You can invest the diffence into a segragated fund which has an historical return through the last 16 years of 7.75% after all fees. After 35 years you've got your $3M in the bank and the cash keeps growing by itself. Remember that's a $3M policy for the duration. At age 90, you have a nest egg of $49,573,293. That's also passes tax free to your heirs!

[bniceintime17]

Great video

[jgilles85]

I love how permanent insurance selling agents will try to find any reason they can to sell crap, but after 30 years they are still using the same arguments and they still don't hold. What happens to that CV value when you die anyway?

[ergs22]

@jgilles85 Crap? Take your head out of the sand and read Bank on Yourself by Pamela Yellen or A Path to Financial Peace of Mind by Dwayne Burnell. Your question will be answered there.

[ParadigmLife]

Thanks for the post Mike. I am very familiar with LEAP, in fact it is part of our background. We do implement the comprehensiveness of the PS&G model on clients. However, we have a different way of maximizing HLV which in turn gives them much more benefit and faciliates the growth of HLV. Truth Concepts was develped by Todd Langford who actually developed some the LEAP software. Todd and his wife Kim Butler teach what is known as "Prosperity Economics" which has totally transformed our business.

[insurancemike10]

You should look into LEAP - I've seen both and LEAP does a better job of complete planning. Good job on this video.