Real Estate & The Multi-Tasking Dollar

Whether you know it or not, you likely multi-task your dollar every day. Do you use a credit card? Each time you swipe, you make more than a simple purchase; you can also pick up points, receive cash back, protect yourself from fraud, enjoy conveniences, and earn additional travel benefits. When we teach clients how to use their personal infinite banking system for real estate purposes, multi-tasking money is a top priority.

To help you understand this concept, let’s begin by outlining a typical real estate investment. Someone else pays slightly more than the mortgage in order to cover utilities and operating expenses; as a real estate investor, you may see some of this come back to you. You will likely save this income for future investments instead of spending it outright. Rather than having rent payments flow solely into an operating account, you could use the rent to create an additional cash-flowing asset.

By using a properly structured, dividend-paying whole life insurance policy rather than an operating account, your dollars will begin multi-tasking. How? Just like a credit card, your policy will accrue extra benefits for your cash. Let’s look at the benefits one at a time:

1. Death Benefit - This is a life insurance product, so naturally, there is a death benefit. Whole life insurance is not an if product. It’s a when product. If you want to leave any type of inheritance, learning how to use whole life as a personal bank will provide financing for life, ensure your debts are paid, and guarantee your beneficiaries inherit your estate.
2. Uninterrupted Compounding – With a whole life policy, if you borrow and pay back with interest, your money will continue to grow and compound as if it had never left the policy.
3. Financial Velocity – Our approach to designing policies is different from most. We structure them to be cash-flow positive between years 2-4 and cash in and out whole between years 6-8, meaning you’ll never lose money.
4. Unstructured Policy Loans – What happens if a renter misses payments or moves out without warning? By flowing money through your policy, you have the option to pause payments into your policy. We work with clients to make sure they understand how to take full advantage of these benefits, especially when unexpected events (like a global pandemic) prompt you to stop directing money through the policy and start taking out loans instead.
5. Creditor Protection – Though the amount of money under protection varies by state, a significant sum within a policy cannot be accessed by creditors, regardless.
6. Care for life – There’s no need to purchase long-term-care insurance. Your policy will pay out of the death benefit for qualifying health events.
7. Disability waiver of premium - If you’re still in your working years, we include a disability waiver, which means you do not need to keep paying for the policy if you become disabled before age 65.

Unbridled Wealth designs policies on a case-by-case basis. For one client, I created a policy that went into effect once he purchased a new rental investment. By using his policy to pay for the mortgage and expenses, he created an additional cash-flowing asset. This asset allows him to pay off the bank mortgage in ten years, provides additional inheritance for his family, establishes a long-term-care plan should his health decline, and offers the other benefits we covered.

It doesn’t matter if you’ve had investments for a while or are just looking to get started. We’re confident we can craft a plan that suits your personal needs. It’s time to begin multi-tasking your hard-earned dollars.