Bank On Yourself With Whole Life Insurance

Is this the “secret” ingredient missing from your real estate business and personal finances?

We love real estate because it gives us control, creative options, tax advantages, and higher rates of return (if we do it right by following Susan’s advice).

However, I am constantly surprised at how even many successful investors don’t know how to treat their investing activities like a business or think about a long-term plan.

Banks and financial corporations are great examples of how to think differently about money and wealth planning. They know how to use certain types of investments and strategies in a comprehensive system that increases their profit, safety, and control that most of us are completely unaware of.

Banks use a diverse portfolio of assets in order to both grow and protect their holdings through every kind of market cycle. The key to their success is having multiple streams of cash flow and control over them.

As real estate investors, we have at least started to think this way and often hold many of the same assets, but we are missing a key ingredient.

One of the favorite “Tier 1” assets that banks hold billions of dollars in is one of the most misunderstood and unused assets by most individuals.

Once I found out about this tool and strategy I made it my mission to help others understand and implement this game changer into their lives and businesses.

What is This “Secret” Asset?

Believe it or not, it’s one of the oldest and most reliable financial tools in existence, Permanent (Whole) Life Insurance.

That’s right the secret asset behind “Income for Life”, “The 770 Account”, “Infinite Banking”, “Bank On Yourself”, “The Perpetual Wealth Code”, and many other fancy marketing names is Life Insurance.

The problem (and reason we have to come up with other names for it) is that we’ve been made to believe that this simple and effective tool is only useful in case of death much like car insurance is used if we have an accident.


Before you check out and move on to another article because I mentioned Life insurance on an investment blog let’s look at some of the misconceptions and benefits of this asset and how it can improve your real estate returns.


Term vs Permanent
Death vs Life benefits
(Un)Necessary Cost vs Important savings tool
Either/Or vs Both/And

Do you really think that banks hold over $160 billion in BOLI (Bank Owned Life Insurance) because they have to or just in case their key employees die?

Or is it possible they know something we don’t?

Let’s Talk About 4 Key benefits of Permanent Life Insurance

Liquidity, Safety, Tax Advantages, and Growth.


We have to keep our cash somewhere. Especially in real estate, having quick access to money is important. In a properly designed life insurance policy you can have access to 75% or more of your money right away and 100% within the first few years.

This is one of the major keys to working with someone who knows how to design your system properly so that you maintain access to your cash.

Most insurance agents don’t know how to do this (or won’t because it cuts their commission). A standard insurance policy can take 10 years or more before you have access to 100% of the money you used to fund it!

I don’t know about you, but I don’t want to wait that long.


These specially designed life insurance contracts are just that, contracts. It states right on the contract how much guaranteed cash value and death benefit you will have at any given point for the rest of your life. No more guessing, wishing or hoping that your savings will be there.

Unlike banks or the FDIC, insurance companies use very conservative actuarial data and investment strategies to ensure the solvency of their companies.

Many insurance companies have paid dividends (profits) to their policyholders every year for over 160 years! Even during crashes like 1929 and 2008.

That’s pretty safe.


Speaking of dividends, it’s also very important that you use mutually owned insurance companies instead of stock owned companies.

Mutually owned companies share their profits with their policyholders instead of lining the pockets of stockholders.

Not only do these profits increase the growth of your policy, they’re tax-free!

The growth rate of your money in a life insurance policy is much higher than any other type of savings account.

But the real magic is that the growth continues even if you borrow against your cash value. Giving you the ability to use your money for investment opportunities and continue earning interest at the same time!

Tax Advantages:

A properly designed system can save you thousands of dollars that would otherwise be lost to taxes by funneling it into your policy.

The growth inside your policy is tax-deferred and can often be totally tax-free.

The death benefit transfers tax-free to your beneficiaries and avoids probate.

Unlike savings or equity in RE property, your cash values are also protected from creditors and lawsuits.

Utilizing these benefits and many more of high cash value life insurance can take your real estate investing business and personal finances to the next level.

Let’s look at a quick example of how this strategy compares to typical investing options….

Case Study: (We’ll just keep it simple with the numbers)
$200,000 SFR property rented for 5 years then sold with 3% appreciation
$2,000 closing costs paid out of pocket (just so we have money in the deal to show ROR)
Gross Rent of $1,500/mo
Monthly Expenses of $250
33% tax bracket with 15% capital gains
Interest only loans paid at the end.

Option 1: Paying all cash $202,000

Option 2: Using financing with 10% down – $22,000

Option 3: Using financing with 10% down borrowed from our life insurance – $2,000

Let’s compare…

Cash OPM 90/10 SDLIC
Cash Investment $202,000 $22,000 $2,000
Cash Flow $50,280 $14,040 $10,020
Cash Out $227,475 $47,475 $27,475
Total Profit $75,755 $39,515 $35,495
ROR 7.11% 24.92% 116.05%
Taxes Paid $29,629 $11,809 $9,829

Now, some of you might argue that you could get 100% financing or use a Private Money Partner. And you should if you don’t have any of your own money.

But, what this chart doesn’t show is the $6,000 of interest that you paid back to yourself instead of someone else. It also doesn’t show the hundreds of thousands of dollars of death benefit that provides a safety net to your loved ones if something happens to you.

How do you calculate the ROR on peace of mind for your family?

Your policy will continue to grow and become more efficient as time goes on making the numbers better and better.

The options and flexibility of this system are limitless. As the lender, you can decide the terms of your loan and also have the ability to change them if something goes wrong. (Not that that ever happens to you)

This system works great for your business as well as your personal financing.

How much more money would you have right now if you applied this concept to every car purchase you’ve made?

Contact us today for a free analysis to find out if a custom tailored Bank On Yourself plan can improve your investment gains and overall financial future.

We’ll teach you the very important rules of a successful financial system:

1. Pay Yourself First (Capitalize your system)
2. Pay Yourself Interest (Be an honest banker)
3. Recapture Your Financing Expense (Eliminate 3rd party lenders)
4. Teach the Next Generation

By establishing your own source of financing you will be able to cut out 3rd party lenders and retain the money you were paying out in interest.

Get a Free Wealth Guide and find out more about this strategy here.

Call or text Luke at 720-234-4694 or email him at


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