I am imensely excite to write this blog post today. Truly, this is going to be a treat. You see, this all starts on a weekend when I wanted to indulge in one of my newly found hobbies: precious metal and coin collecting.
I had just finished talking with the member services rep that Saturday morning who assured me that I would be able to get into my safety deposit box and the bank. I took this as the all clear an made my way to the bank. Once I arrived there, I was met with locked doors and a long line at the drive up. As it turns out, after waiting for the line to pass and my turn in front of the tellers at the Drive-Up, that the bank is closed on Saturdays. I don’t normally get upset about people telling me bad news, but for some reason, being told that I couldn’t access my property for security purposes really got under my skin. Even as I walked away from the bank, I felt immensely upset that I wasn’t able to pull my coin collection out of the safety deposit box so that I could learn more about my collection.
Nearly twenty steps from the bank I found myself asking my phone how to live a life without a bank. What were some of the things that I would need to consider moving forward. Yes, I was that mad. I was actively seeking out a way to eliminate the need for a bank in my life. With that said, I found many interesting resources and also a growing phenomena of people who are going “unbanked”. But what’s more is that I found a concept buried in all the articles that has recently changed my perspective, and that is the concept of warehousing value.
Okay, so I am reading about going with out a bank in this article and that’s when I find the author referencing a Nelson Nash and his book discussing the infinite banking principle. As it turns out, I stopped reading the article and immediately went to library genesis to find a copy of the text. In a matter of hours I had read his entire book and left feeling that I had my entire world turned on its head. When this feeling happens, especially on a weekend, I go into over drive and seek to learn more.
So I go back to the article that I had read that had keyed me into Nelson Nash’s work and found another book by another author: Pamela Yellen.
I end up finishing this book the following day and I am feeling exceptional well versed in the ideas that they were trying to communicate to their audience: people like you and me that really should look to stop using the bank and other financing companies money and rely on our own capital reserves.
You might be asking your self, “That’s great, Alixander. You read some books about banking. What’s so special about that?” I’ll tell you.
The thing that both of these books have in common is the idea of warehousing value, or wealth, in a different kind of bank. One that is more secure than a bank, provides more interest than a bank, and can be borrowed from better than a bank. So what am I talking about?
Whole Life Insurance.
Yes. I know some people think that insurance is a huge scam. When you aren’t using it right, or not understanding what the benefits are of having a well designed policy that is fully put into use, of course it is going to seem like a scam. But I assure you, that once you understand that you have to store money somewhere, storing money in a whole life insurance policy is one of the most effective ways of earning interest on your savings.
That’s really what its all about, you are either paying interest or getting paid interest. And when you are keeping your money in a bank, you are earning nothing in return for what? Honestly, ask your self: what does having my savings in a bank account do for me?
If you answer safety, great. Did you know that in the event of a lawsuit that your accounts are subject to being seized? Life insurance cannot.
If you answered financing, wonderful. Did you know that when you draw on your bank account to pay for the financing of your new car that you are out that money? Life insurance retains the value in spite of your borrowing against it.
If you answered liquidity, perfect. Should your savings be liquid? Life insurance allows you to draw or borrow up to 90% of the policy’s cash value, meaning you are generating a greater amount of interest than the bank while also having access.
I could go on and on about making use of Whole Life Insurance policy for the purpose of warehousing money. But honestly, you should just read the books and learn for your self. Heck, if you are in too much of a hurry. Go to your insurance professional and ask them about a dividend producing, whole life policy with paid up addition rider. If they are worth their salt, they will show you the true magic. But I guess it won’t really make sense until you take the time to read about Banking on Yourself and Becoming Your Own Banker.