Becoming Your Own Banker, Part 22: Get a Higher Rate of Return

Are you looking for a higher rate of return? If so, your quest may point you to an important secret as you make financial decisions. Most people want to get the highest rate of return on their investment dollars .... which is why whole life insurance can be such a turn-off.  It seems like a wimpy competitor in the rate of return game. https://www.youtube.com/live/Hu1qEPn9Wc8 But in his groundbreaking book, Becoming Your Own Banker, Nelson Nash addresses this question head-on, which is why we will too. In today's discussion, Bruce and I will take an honest look at the rate of return, why it's not as simple as comparing dividend rates or interest rates, and how Infinite Banking actually increases your rate of return. Today, we challenge the conventional wisdom that focuses solely on the rate of return. We delve into the often-overlooked elements of personal finance, such as taxes, volatility, cash flow, and the unique benefits of a life insurance policy. This episode isn't just a numbers game; it's a revelation of the multifaceted advantages of incorporating whole life insurance into your personal economy. It's time to zoom out and consider the entire financial landscape. We're guided by Nelson Nash's philosophy, which teaches us that every financial action – from spending to saving – is interconnected. Bruce and I explore how leveraging cash value can serve as a buffer against market volatility, enhancing your financial resilience. If you've been fixated on isolated investment returns, let this be the wake-up call that steers you towards a more holistic and strategic approach to building wealth. Understanding the fine print of life insurance policies can be akin to learning a new language, but we're here to translate. We unravel the intricacies of policy loans, PUA payments, and the latest regulatory changes impacting your Infinite Banking policy. This crucial conversation is tailored for those yearning to fine-tune their financial strategies and those curious about how behavior significantly influences financial growth. Tune in for a masterclass on optimizing your financial trajectory, and remember, if you're seeking personal guidance, a deeper conversation is just a consultation away. ”Interest Rates Don’t Matter”Everyone is Seeking a Higher Rate of ReturnHow Are You Financing?Life Insurance Allows You to Do MoreBook A Strategy Call ”Interest Rates Don’t Matter” Interest rates don’t matter. Or, at least, they don’t matter in the ways that most people seem to think. The reality is that not all rates are created equal because they have their own sets of circumstances. Think of how many people choose to buy a more expensive car simply to get the 0% financing. Yet, what’s more important? The interest rate that you pay, or the total monthly payment? When people prioritize interest rates, they often end up paying more per month for a more costly car. Reducing the monthly payment, even at the expense of a higher interest rate, can give you more monthly cash flow that could potentially be put to better use elsewhere, such as paying an insurance premium. Consider, too, how this impacts rates of return. If you had to choose between a 7% rate of return on your 401k or a 7% rate of return on your Roth IRA, which would you choose? Or does it even matter? You might be tempted to say that it doesn’t matter, and yet, when it comes time to distribute your funds, you’ll have to pay taxes on the 401k, but not on the Roth IRA. With that in mind, does it matter what you choose? In this case, interest rates don’t really matter. In fact, knowing what you know, you might even choose to take a lower rate of return in the Roth IRA simply because you’ll fare better in the long run when it’s time to distribute.  When we say interest rates don't matter, what we really mean is that they are not the beginning and end of a good financial decision. There’s information in between that lends context to the interest rates....