What is Bank On Whole LifeTM for You?
When structured using one of our Bank On Whole LifeTM concepts, participating whole life insurance policies offer you insurance protection, a tax-free death benefit, and a cash value that is designed to become a supercharged asset you own and control; one that allows you to build equity year over year through guaranteed contractual returns and potential dividend earnings.
Think of participating whole life insurance as the savings vehicle, and our Bank On Whole LifeTM concepts as the turbo fuel injector that supercharges the strategies needed to grow the cash value over time. You can leverage this equity in your policy to finance anything you need, whenever you need. It’s like having your own personal, lifelong, savings account that continues to grow uninterrupted—even when you borrow from it! You control your money.
Since our Bank On Whole Life concepts are unique and intricate, the whole life policy must be structured by a licensed life insurance agent with specific training and credentials in these types of concepts—which include Bank On Yourself and the Infinite Banking Concept.
Our Bank On Whole LifeTM Concepts
SET Financial Solutions, a strategic partner of MacDev Financial, is the exclusive Canadian provider of the Bank On Yourself® concept and the Bank On Yourself® Professional Training program. As the leading experts in Canada on Bank On Yourself, our licensed life insurance agents have completed the rigorous training to become Bank On Yourself® Professionals.
Bank On Yourself® (BOY) was developed by Pamela Yellen in 2002 and is a concept “focused on helping people achieve their financial goals and objectives using a little-known variation of a whole life insurance policy” known as participating or dividend-paying whole life insurance.
It’s a time-tested financial strategy with a 160-year track record that lets you grow your money, faster, safely and predictably—even when the stock markets, real estate and other types of investments tumble due to volatile market conditions. Yellen outlines the benefits of the Bank On Yourself® strategy in her New York Times best-selling books, Bank On Yourself and The Bank On Yourself Revolution.
The Infinite Banking Concept (IBC) was developed by Nelson Nash. He is also the founder of the Nelson Nash Institute and author of Becoming Your Own Banker—the first edition published over 20 years ago! The mission of the Nelson Nash Institute is “to educate and inspire individuals to take control of their financial lives by reclaiming the bank functions from others.” Similar to the Bank On Yourself® concept, the Infinite Banking Concept® uses participating (also known as dividend-paying) whole life insurance as the ultimate savings vehicle.
How Does Bank On Whole LifeTM Work?
When structured in the right way, using one of our Bank On Whole LifeTM concepts, the cash value of a participating whole life insurance policy is comparable to the equity you build up in a home or real estate property when you pay a mortgage.
A home is an asset with a certain value you can use as collateral to obtain a loan called a HELOC (Home Equity Line of Credit). When you pay into the mortgage on your home, the payments reduce what you owe, and you gain in home equity—the value of the paid-off portion of your mortgage. The value of your home remains but you are leveraging the equity to collateralize the HELOC.
A participating whole life policy is permanent insurance that also creates equity, with what is referred to as a cash value. This cash value is also considered an asset you can use as collateral—one of the reasons we often compare it to homeownership. And along the same lines as the HELOC scenario, when you take a loan out on your whole life insurance policy, the cash value stays the same—as if you haven’t even touched it because you are leveraging the equity in the policy’s cash value as collateral.
One key difference with a Bank On Whole LifeTM structured participating whole life insurance policy is, you can access your money without going through financials—which is not usually the case with a HELOC. You simply request the policy loan and within days, you receive the funds.
Another key difference with this type of policy is the time-proven potential to earn dividends. Impressively, for over 160 years, these types of policies have been paying out dividends in North America. The policy is structured to use these dividends to purchase more insurance known as paid-up additions, which accelerate and fast-tracks the growth of both the cash value and death benefit in your policy.
Here are just a few of the ways a Bank On Whole Life plan is a unique, all-in-one financial solution that works to protect and preserve your estate and legacy in the future while helping you plan and self-finance many of life’s big purchases today…
(Click on each link for more information via our Lifestyle Planning page.)
Saving for Education – Use a Bank On Whole Life plan to guide education savings for your child or grandchild instead of an RESP. You can take a policy out on your child within the first year of birth at lower, affordable rates to start saving for their post-secondary education in advance with guaranteed growth, so you will know what is available when the time comes to use it.
Lifestyle Purchases – The equity in your Bank On Whole Life plan policy gives you flexibility and accessibility to a liquid cash reserve you can use while living to self-finance what you need when you need it. Our clients have used their Bank On Whole Life plans to pay for vehicles, new business equipment, vacations, home renovations and virtually just about anything else you can think of!
Securing Retirement – A Bank On Whole Life plan accounts for an additional stream of retirement income when you stop working. Better yet, you’ll have peace of mind knowing exactly the minimum guaranteed value of your account on the day you except to tap into it. An RRSP is tax-deferred and subject to market fluctuations and volatility, and can’t provide you with the same guaranteed value of funds when you retire.
Legacy Planning – A Bank On Whole Life plan sets you up with the ability to earn annual dividends on top of guaranteed returns. These dividends can be used to purchase additional insurance which helps to accelerate the growth of both the cash value and death benefit of your policy—a great mechanism for building wealth and leaving a legacy for future generations.
Charitable Giving – If you make regular contributions to a charity, a Bank On Whole Life plan can strategically amplify the amount of your charitable gift and reduce your estate’s income tax without impacting your family’s inheritance.
Benefits of Bank On Whole LifeTM for You
Tax Advantages – Under current law, create a tax-free retirement income; you can access your principal and growth with no taxes due.
Insurance Protection – Financially protect your family and leave a legacy.
Cash Flow – Optimize more of your money to create an emergency fund, self-finance lifestyle needs and save for retirement simultaneously.
Annual Dividends – Build wealth through secure, predictable, long-term savings growth.
Guaranteed Returns – Keep more of your money by eliminating financial loss & unnecessary risk.
Financial Control – Have access to your money without paying penalties for whatever your financial needs may be for your todays and your tomorrows. Know what your retirement account will be worth on the day you plan to retire.
Legacy Planning – Preserve your estate for future generations or leave a charitable legacy.