“Life Bank” is another term for purchasing a properly structured whole life insurance policy that pays dividends from a mutual life insurance company. Life Bank is the perfect tax-free financial option with great upside potential. Consider the following:
- Tax deferred growth
- Tax-free distribution
- Competitive rate of return
- Lifetime tax-free income you can not outlive
- Higher than normal contributions
- Can be structured for tax-deductible contributions
- Collateral opportunities
- SAFE Harbor for money, not like FDIC insurance (465 banks failed in 2009 alone).
- No-loss provision
- Can design the policy to lock in your insurability to purchase more
- Guaranteed loan provisions
- Unstructured loan payments
- Liquid at all times
- Full use, can use the money without restrictions
- Full control of deposits, withdrawals and loan repayments
Here’s an example of using Life Bank to purchase a $30,000 automobile. You have three options in purchasing a car: cash, financing or Life Bank.
Cash: Using cash means the money is gone to the seller. Your loss of the use of the money means you lost the interest growth this money could have earned for you; instead, the seller is getting the benefit of your cash.
Financing: Going the traditional bank/credit union route to finance the car means you pay out and lose forever the payments, which not only equal the base total of $30,000 but the additional interest you must pay the bank to finance the car, which comes to $3,968 in this example. In addition, the car will only be worth $10,000 at the end of the loan.
Life Bank: Cash value come from policy and buys the car. You pay the same as a loan from a bank or credit union but the $33,968 goes back to your living Life Bank. Now the magic happens. One hundred percent of this money is now yours again. In addition, you get interest paid on all the cash as if it never left the insurance policy. The insurance company charges you 5 percent for the loan, but currently pays 7.1 percent as a dividend. You now have two wonderful benefits for using your Life Bank: $38,501 more in your Life Bank policy and the value of the car at $10,000.
