In part two of this series with Todd Langford, they tackle the misconception surrounding the interest rates on policies and the rate of return on being your own banker. Despite what people say, your costs have to be less than your investments to make money. Listen in as they share examples to explain this theory and how to make the most of borrowing from your policy.
Highlights
01:17 The common misconceptions with simple interests
04:28 Debunking the myth of earning 4% and loaning at 6%
07:43 The impact of the time value of money and the cost of money in financial transactions
11:46 Only circumstances under which having money at a lower interest rate and having debt at a higher interest rate makes sense
14:06 Busting the myth: Why earning four and borrowing six ultimately doesn't work
15:39 The idea that borrowing money from the policy is where the "magic" happens
18:10 Differences between certainty assets versus opportunity funds
23:05 The accumulation phase: Having a comprehensive understanding of whole life insurance and financial planning
Episode Resources
