Why Hasn’t My Financial Advisor Told Me About This?

Most advisors in the financial services industry are paid based on how much of YOUR money they are “managing” for you. They receive a fee off the top of your portfolio whether your money goes up or down with the market. It is to their advantage to shoehorn you into the investment products their company sells. 

Most advisors don’t understand the intricacies and nuances of these specially designed forms of whole life insurance, they aren’t licensed to sell it, and their company doesn’t offer it. If you go to them for advice, they will tell you it’s the worst financial decision you could make. Why? Because then YOUR money goes out from under THEIR management!

As a fiduciary without a dog in the fight, I will always help you pick the very best plan for you and your lifetime wealth management situation.

This Sounds Too Good to Be True, So it Must Be!

This is SO GOOD that it IS TRUE! The only way to PERMANENTLY transition your wealth from “taxable” to “non-taxable” is to park it into one of these specially designed whole life insurance contracts! Every other financial vehicle in which you accumulate wealth will eventually be taxable on the distribution.

If This is So Good, Why Isn’t Everyone Doing It?

These financial tools have been around for over 200 years. The wealthy in our country have been utilizing whole life policies to pass on generational wealth for a couple hundred years.

They have been used by the likes of Walt Disney, Ray Kroc of the McDonald’s fame, Michigan College Football Coach Jim Harbaugh, J.C. Penney. Doris Christopher borrowed $3,000 from her life insurance policy and started The Pampered Chef in her suburban Chicago home in 1980.

People today are scrambling to find a “different” way to protect and preserve their wealth. Whole life has so many bad connotations because of everything you read on the internet and because your financial advisor tells you it’s the worst place on the planet to put your money!

What they DON’T know, and no one is telling them, whole life insurance is the ONLY financial vehicle on the planet that will protect and preserve your wealth to your death!

We build these contracts differently than 99% of all life insurance contracts out there. They are built for LIFE BENEFITS. We want you to enjoy 100% tax-free spendable cash flow during your retirement / distribution years without worrying about future unknown tax rates, future tax code changes, and uncertain market volatility.

These very specially and uniquely designed whole life insurance contracts are THE ticket to your financial future.

I will caution you, unless you have a trusted guide like me, you could make one of the worst financial decisions of your life.

Surely the Government Will Figure This Out and Change the Tax Code!

Oh, the government knows about it alright! It’s where all the politicians park their wealth! Do you ever wonder why politicians can say that their Executive Assistants pay more in taxes than they do?!

The tax code changed once in 1987. Met Life took out an article in the Wall Street Journal that said “Cheat the Government.” Senator Bob Packwood took it to a Congressional hearing and instead of being able to fund a contract with one contribution (like the wealthy in our country were doing), now it had to be funded over a period of years. Congress gave all the politicians 6 months to get their single-premium contracts before they signed the change into law, and all contracts were grandfathered in.

What are the Downside Risks?

You must qualify to participate by going through underwriting. Based on your application, a short in home health check-up, and your medical records, you will either be given an offer or your application will be declined.

If you receive an offer, that means both the IRS and the insurance company give you permission to participate in this strategy.

Can I Get a Prospectus?

When a company seeks to raise capital through the offer of securities to the public, or seeks an admission to trade securities, a prospectus or listing particulars will be issued, detailing in-depth financial information about the company and its future objectives and strategies. 

Whole life policies are contracts; therefore, they provide “different” benefits when compared to a securities product. Whole life has guarantees, a death benefit, tax-preferential treatment, dividends, riders, loan opportunities, etc. There are contractual obligations and benefits between the whole life purchaser and the insurance company.

The financial strength and stability of the company is of utmost importance when comparing and contrasting whole life insurance policies. Annual reports are a good place to start.

How Long Have These Been Around?

The first whole life insurance policy was issued in 1759 to Poor and Distressed Presbyterian Ministers for the purpose of taking care of their widows and children. The Presbyterian Minister’s Fund (PMF) is deemed the oldest life insurance company in America. It was among the first life insurance companies to broach the idea of offering life insurance to all human beings. PMF remained in existence for over 200 years, until it was bought out in the early 1990s.

How Does the Internal Rate of Return Compare to My Existing Investments?

Whole Life Insurance is not an investment like most people think of investments; therefore, it doesn’t have a “rate of return” like typical investments.

We “value” whole life insurance by comparing the 100% tax-free spendable cash flow distributions to distributions out of any other investment asset on the planet. Most other assets would need to grow by 9% – 21% in order to equal the same distributions as out of a whole life contract.

Is it an Annuity?

No, it is not an annuity. I do not recommend annuities for a number of reasons:

  • Loss of liquidity – your money is tied up with potentially high surrender fees
  • Higher taxes – annuities are taxed at ordinary income tax rates
  • Complicated returns – returns may be quoted before fees and expenses, company may be allowed to “reset” your rate of return
  • Multitude of fees and charges – all of which come out of your principal and your pocket
  • No protection against inflation
  • Survivor benefit coverage may not be included
I’m Diversified; I Don’t Want All My Eggs in One Basket

Let’s talk about diversification. If you have money in tax-deferred plans (401k, IRA, 403b, SEP, etc.), brokerage accounts (stocks, bonds, mutual funds), and real estate, are you “diversified?” You may think you are, but when the market crashes, you lose on ALL your money. 

Financial advisors and investment managers trick you into believing you are “diversified” because there is a different “label” on your account; however, all your money is in the market! 

What if you could park all your wealth in an asset that is non-correlated to the market, is guaranteed to grow, is safe and secure, grows and distributes 100% tax-free, and builds collateral that can be leveraged? Then you could leverage your collateral to invest in whatever you wanted to: real estate, hot stocks, fix and flips, start-ups, businesses, commercial property, etc. You could literally be as “diversified” as you want to knowing that you will never, ever lose the forward momentum of your money.

It Must Be A Loophole in the Tax Code

Actually, it’s been in the tax code for 107 years since its inception in 1913. The 1990 General Accounting Report details the Tax Treatment for Life Insurance:

“If a policy holder borrows the inside buildup from his or her life insurance policy, the amount borrowed is considered a transfer of capital, not a realization of income, and therefore, is not subject to taxation. The ability to borrow against a life insurance policy means that the interest income that is supposed to be building up to fund the death benefits can instead be a sourced of untaxed current income. If the loans are not repaid, the inside buildup will never be taxed; death benefits will simply be reduced by the amount of the loan. Thus, policyholders have the use of tax-free income for purposes other than insurance at the expense of reduced death benefits for their beneficiaries.

Are You a Fiduciary?

A fiduciary is defined as the legal and ethical requirement to act in the best interests of your clients and put their interests above their own. If you undertake to assist someone in a situation where they place total confidence and trust in you, you have a fiduciary duty to that person.  

Not all advisors are required to put you first. Advisors can be detrimental to clients who unwittingly expose themselves to biased and potentially costly advice from advisors who put their own interests before their client’s interests.

I would argue that I am more of a fiduciary than most financial advisors, because I am providing education on the accumulation AND the distribution of your wealth. Financial advisors are not required by law, by FINRA, or by the SEC to talk about the implications of the choices you are making today on the distribution of your wealth, especially from a tax perspective.

What About a Roth – That’s Tax-Free

The Roth was established as part of the Taxpayer Relief Act of 1997 and named for Senator William Roth, its chief sponsor. 

While money inside a Roth grows tax-free and distributes tax-free according to today’s tax code, there are many restrictions and limitations: 

  • Limitations on contributions ($6,000 or $7,000 if age 50 or older)
  • Eligibility to contribute phases out at certain income limits (single filers it phases out at $139,000; married filing jointly at $206,000)
  • Funds cannot be used as collateral, therefore cannot be used for financial leveraging
  • Withdrawals must be taken after a 5-year holding period
  • Only contributions can be withdrawn prior to age 59 ½
  • Roth is another IRS tax code
  • Congress can make changes to Roth plans anytime they want to
  • There is currently talk on Capitol Hill of allowing states to tax the growth inside Roth plans upon distribution
  • There is also talk of including Roth distributions in the provisional income calculation for how much of your Social Security benefits will be taxed
How Does the Tax-Free Part Work?

Whole life insurance is funded with after-tax money. Once your money is INSIDE the contract, it grows tax-free, you can take tax-free loans by leveraging your collateral, and your death benefit passes tax-free to your beneficiaries – GUARANTEED!

How Much Does it Cost?

Your premiums are not reduced for costs. What you put in your contract is your money. The insurance company invests your premium dollars to build your death benefit and to make the company profitable.

Because these are mutual insurance companies, each policy holder owns a portion of the company. The company declares and pays dividends that go directly into building more cash value and death benefit inside your contract.

Isn’t an IUL a Much Better Insurance Vehicle Than Whole Life?

Indexed Universal Life (IUL) policies are relatively new to the market. They were created in 1997 by Transamerica Life Insurance Company. They were created to combat market volatility and financial vehicles yielding very low returns.

IULs come along with 3 inherent costs:

  • Market fees – to be indexed to the market
  • Administrative fees – to change at the company’s discretion
  • Mortality fees – each year you get older, you get more expensive and you pay for it

IULs are built on one-year renewable term policies, which is the most expensive kind of term insurance you can buy. As the years go on, either your flexible premium goes up or your coverage goes away.

The risk in an IUL is transferred from the insurance company to the policyholder, therefore insurance companies love for their agents to sell them and commissions are higher as a result.

An IUL is a life insurance policy coupled with an investment where neither the insurance company coverage or the returns are guaranteed by the insurance company.

Two options when you purchase an IUL:

  • Purchase knowing the coverage will go away sometime down the road unless you can afford to pay the ever-increasing premiums
  • Plan to die before the coverage runs out

Life settlement companies have been springing up since the early 2000s. A group of investors get together and purchase life insurance policies from policyholders who can no longer afford the premiums. The policyholders are typically people over age 70 with IULs.

The life settlement company cashes out the policyholder, pays all future premium payments, and receives the death benefit upon the death of the insured.

I’ve Heard Your Commissions are Really High – I Don’t Want to Pay Them

Interesting you should say that. Have you ever figured out how much you are paying in fees every year for your money to sit in tax-deferred plans (401k, IRA, 403b, SEP, Solo, Simple, 457, etc.), brokerage accounts (stocks, bonds, mutual funds), and all other “brokered” accounts? Depending on the size of your accounts, it can be hundreds of thousands of dollars, all of which comes out of your principal and out of your pocket.

My commissions do not come out of your policy.

Your policy is managed by the “policy” side of the insurance business. They are tasked with the management of the insurance business from start to finish. That includes applications, underwriting, actuarial, products, in-force policies, cash value, death benefits, policy loans, policy pay backs, etc., and the financial stewardship of our premiums. 

Commissions are a company expense and are managed as part of a profitable P & L. Commissions are different for every agent for every policy. There are dozens of variables that go into the commission calculation, and they are constantly changing to meet the needs of the business.


Tax & Market History

Tax Code for Life Insurance

2020 Federal Single vs Married Filers

IRS Uniform Lifetime Table

Social Security Benefit Taxation

Capital Gains Tax Rates

Taxes on Medicare

Safe Withdrawal Rate

Get Out of Tax Jail Before It’s Too Late

IRS Tax-Deferred Plans


Presbyterian Minister’s Fund

Companies Started with Cash Value Life Insurance

Jim Harbaugh Compensated with Whole Life Insurance

Lifetime Collateral Asset

Capitalize and Collateralize

Wealth Distribution Analysis

Cornerstone Asset of a Bank

“AND” Asset


Income vs Cash Flow in Retirement

Retirement Reality Ready

Where Do You Park Your Money?

Your Wealth Mountain


Confessions of a CPA

Why What I Was Taught To Be True Has Turned Out Not To Be


Confessions of a CPA

The Truth About Life Insurance


Confessions of a CPA

The Capital Equivalent Value of Life Insurance


Money. Wealth. Life Insurance.

How the Wealthy Use Life Insurance as a Tax-Free Personal Bank to Supercharge Their Savings


Live Your Life Insurance

Surprising Strategies to Build Lifelong Prosperity with Your Whole Life Insurance Policy


Stop the 401(k) Rip-off!

Eliminate Costly Hidden Fees to Improve Your Life



Ohio National
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