Confidential Banking Concept
Confidential Banking Concept
A MAN NAMED NELSON NASH WROTE THE BOOK ‘BECOMING YOUR OWN BANKER. In the book, he talks about using participating whole life insurance to take out a policy, that you then use to finance purchases like investment properties, or vehicles.
IN THE 1980S HIGH INTEREST RATES CAUSED NELSON NASH INCREDIBLE PRESSURE BECAUSE OF THE FACT HE HAD HIGHLYLEVERAGED INVESTMENTS IN REAL ESTATE. He needed to get out of debt and help his family. Out of his struggle to find the answer, the confidential banking concept was born.
NASH REALIZED THAT HE COULD BORROW MONEY THROUGH HIS LIFE INSURANCE POLICIES AT ONLY 5 TO 8%. At the same time, bankers were charging him 23% interest when the prime rate was 21.5% at that time. He transferred his debts to life insurance and was able to repay the money on his chosen timeframe, with better interest rates.
HE USED THIS SYSTEM TO BECOME A MULTI-MILLIONAIRE. THE COMPOUNDING AND GROWTH OF THE CASH VALUES IN THE LIFE INSURANCE POLICIES MORE THAN OFFSET THE INTEREST HE PAID. Nash described the confidential banking concept as “An exercise in imagination, reason, logic, and prophecy; one that creates super abundance.”
WHAT STARTED OFF AS NELSON NASH’S PRAYER, GREW INTO A POPULAR NEW WAY OF BANKING. PARTICIPATING WHOLE LIFE INSURANCE IS A POOL OF WEALTH, WHICH YOU CAN USE TO FINANCE VARIOUS PURCHASES.
It transfers the control of the banking equation from big banks, to you, the policy holder. Taking back control of this equation takes the fear out of finance, and allows your family to live an abundant life.
Do you want to be remembered by future family generations…
How To Create Generational Wealth Using Confidential Banking
It’s a simple concept; one the very rich have been using to store and grow wealth for over 200 years.
Time Horizons are major life events like:
- Starting a business
2. Having a dream wedding
2. Buying a first home
3. Going to college or university
4. Celebrating Retirement
Using confidential banking, your family can celebrate major milestones, without worrying about finances.
DID YOU KNOW THAT TIME AND MONEY ARE BEST FRIENDS?
WHAT IF YOU HAD ACCESS TO A CONSTANT COMPOUNDING MONEY MACHINE? What would you finance: a house, wedding, family holiday, or dream car?
YOU CAN USE PARTICIPATING WHOLE LIFE INSURANCE. Make those dreams a reality by following a few simple steps.
PARTICIPATING WHOLE LIFE INSURANCE TAKES DIVIDENDS, OR THEIR PROFITS, AND SHARES THEM WITH THEIR CLIENTS. The dividends are reinvested into the policy, allowing it to grow interest and gain large cash values.
EACH YEAR, THE MONEY COMPOUNDS ON GREATER AMOUNTS, GROWING YOUR FAMILY POOL OF MONEY. By retirement, many people have millions of dollars, even when they started off with a relatively small amount because they started early.
Our specially designed guide allows parents and children to read examples and stories, to help understand the simplicity of confidential banking, and how to leave a legacy of wealth and financial stewardship.
Be the buyer and seller of the same thing:
The Grocery Store
If you want to open a grocery store you need to do 3 main things:
- Study how to be successful in the grocery business.
- Find a great location to build a beautiful store
- Stock the store with groceries and ensure hired help keeps it well stocked.
There is a lot of work, time, and money invested in setting up a store before it is profitable. It’s like when you heat seawater. At 210 degrees Fahrenheit (99 degrees celsius), it is hot water. At 212 degrees (100 degrees celsius), it is live steam that can power trains, ships, and factories.
Let’s say you sell instant noodles for 99 cents a box, and it cost you 96 cents to buy them from the supplier. Each time you sell a package of instant noodles, you make 3 cents. Imagine how many boxes you’d have to sell to pay for the location, staff, and other expenses.
What if someone in your family loves instant noodles?
He or she might want to take groceries out the back door.
Some people call this stealing. It will take selling 33 packs of instant noodles to make up for it (33 x 3 = 99 cents). The other employees might want to take their groceries out the back door too. When tax collectors generally take more money when you make more, that increases the urge to take groceries for free.
Your business is at stake if you cannot overcome this urge. You know people in your family aren’t going to a competing store to buy noodles, so instead of charging 99 cents, you charge $1.01 a pack. These are captive customers because you know they’re only coming to your store.
You use the extra 2 cents per package to buy more noodles to sell to more customers. Over the course of several years you see greater profits using this method. Your business will see more profits than your competitors, who allowed their families to take “free” groceries. Your family will “clip larger coupons at retirement”.
THE PROBLEM ISN’T THE INTEREST RATE, IT’S THE VOLUME OF INTEREST
JUST LIKE AT THE DOCTOR’S OFFICE… Too little medicine won’t do anything, but too much can kill you.
WHEN YOU FIRST OWN A HOME. You must pay huge amounts of money on your first mortgage, and most of it goes towards paying interest and closing costs.
IN THE FIRST 5 YEARS, IF YOU SPEND A TOTAL OF ABOUT $40 000, ONLY ABOUT $5500 ACTUALLY PAYS OFF THE MORTGAGE. The other $35 000 or 87% goes towards interest and closing costs.
YOU THINK YOU’RE PAYING FOR YOUR HOME. But really, you’re just making the wheels of the baking and real estate businesses turn. They are profiting off of you!
IF THE PERSON BUYING THE HOME IN THIS EXAMPLE MAKES APPROXIMATELY $30 000 A YEAR OR LESS, THAT MEANS 34.5 CENTS OF EVERY DOLLAR OF DISPOSABLE INCOME IS PAID TOWARDS INTEREST THROUGH FINANCING
EVEN IF YOU’RE ABLE TO SAVE 10% OF YOUR INCOME, YOU’RE STILL LOSING MONEY. Maybe this is why the average North American family is $200 away from bankruptcy.
THIS IS LIKE FLYING AN AIRPLANE WITH A HEADWIND. The force pushes against you for the entire flight, and you lose energy, time, and money.
IF THE AIRPLANE HAS A TAILWIND, IT WILL GET TO YOUR DESTINATION FASTER AND MORE PRODUCTIVELY. You can’t control flying conditions, but you can control the banking equation.
BY USING A PARTICIPATING WHOLE LIFE INSURANCE POLICY… You’re able to control the banking equation and create a perpetual “tailwind” that can last down multiple generations.
VOLUME OF INTEREST EXAMPLE: APR FINANCING
LET’S SAY YOU BUY A HOUSE. You pay it up over 20 years at a very low interest rate of 3.25%, which stays at 3.25% over the full 20 years.
YOU MAKE A DOWN PAYMENT OF 10% OR $30 000. This causes your payments to be $1576 a month, over the next 20 years.
AFTER THE 20 YEARS, A TOTAL OF $408 240 HAS BEEN SPENT TOWARDS A HOME WORTH $300,000. That is $108 240 that you can never recover, or 26.5% extra, paid towards your mortgage.
MORTGAGE INTEREST RATES FLUCTUATE, MEANING THE RATES TODAY COULD BE VERY DIFFERENT AT RENEWAL TIME. Therefore, this is a conservative outlook on the interest you will actually pay. For example, in the 1980s, interest rates were over 20% in all of North America.
How Banks Use Your Money
This is how banks 10X your money
WHEN YOU DEPOSIT $1,000 TO THE BANK. Did you know banks can lend out $10,000? They count on the fact that not everyone will withdraw their money at the same time.
SOMETIMES BANKERS TAKE LOANS AND DON’T REPAY THEM. This happened to First National Bank in Texas in 1983. They had $1.5 billion dollars of loans, and 26% of them were not getting paid back.
DUE TO THE UNPAID LOANS, STOCKHOLDERS LOST 87% OF THEIR STOCK VALUE. Deposits decreased by $500 million dollars, as clients stopped putting money into First National Bank.
PEOPLE WERE GREEDY AND DIDN’T PAY BACK THEIR LOANS. They ended up losing both their jobs and their money. Just like in real banks, when you finance purchases with your whole life insurance policy, it’s best to pay them back to the policy.
THE BANKING SYSTEM IS FAULTY. THERE’S A BETTER WAY. When you create your own bank using dividend paying whole life insurance you can play honest banker with yourself, and avoid paying 34.5 cents in interest for each dollar to major banks.
Every time a person buys a life insurance policy, he is starting a business from scratch.
This creation has a “start up” cost.
LIKE ANY BUSINESS, IT TAKES TIME TO GROW. THE AVERAGE TIME TO SEE A PROFIT ON A BUSINESS IS A MINIMUM OF 5 YEARS. It takes about 5 years to start making a profit, but after that, the magic of compounding really begins.
THE POLICY GIVES YOU A PLACE TO PUT WINDFALLS OF MONEY LIKE INHERITANCES, AND INVESTMENT GAINS. You, the policy owner, have the right to borrow the full cash value at any time. You have full control on when and how you pay it back.
REMEMBER TO PLAY THE BANKING GAME. Instead of depositing all your money in the bank, and paying 34.5% of every dollar to interest, use the system to pay yourself back with interest.
IF YOU USE THE POLICY TO TAKE OUT A LOAN… Don’t forget to pay back the same interest to the policy as your next-door neighbor paid to the bank. This allows the money to compound more quickly.
GET INSTANT APPROVAL FOR ANY LOAN BECAUSE YOU FINANCE IT YOURSELF. The longer you keep the policy, the more the money grows. The policy becomes a constant compounding money machine that keeps wealth in your family for generations.
Overcoming Human Problems
YOU NEED TO OVERCOME THESE PROBLEMS TO BECOME YOUR OWN BANKER AND MAXIMIZE WEALTH:
- PARKINSON’S LAW
- WILLIE SUTTON’S LAW
- THE GOLDEN RULE
- THE ARRIVAL SYNDROME
- USE IT OR LOSE IT
Parkinson’s Law states that work expands to the envelope of time, and expenses rise to equal income. If someone tells you that you have a week to complete a task, it’s probably going to be finished at the end of that week. If you get a raise at work, you’re going to find new things to spend that money on, until there isn’t any left. If you can’t overcome this law, you will never create lasting wealth.
Willie Sutton’s Law. Willie Sutton was a famous bank robber whose expertise was stealing money. This law says that if you amass wealth, someone will try to steal it. There are two ways to create money; people earn money, and the government takes their earnings. A safe place to keep your money from Willie Sutton types or taxes is in participating whole life insurance.
The Golden Rule. Whoever has the money makes the rules. When you have large amounts of money, opportunities appear everywhere. It is a national disease when people expect the government to take care of their expenses.
The Arrival Syndrome. A HISTORIAN NAMED DANIEL BOORSTIN SAID, “THE GREATEST OBSTACLE TO DISCOVERING THE SHAPE OF THE EARTH WAS THE ILLUSION OF KNOWLEDGE.” THIS IS A COMFORT ZONE WHERE WE CAN’T LEARN ANYTHING NEW.
People who practice confidential banking open their minds to a new way of thinking, and see how the banking system really works. “If you understand what’s really happening, you’ll know what to do.” – Fortune Magazine 1993
Use it or lose it. If you want to be successful, you must develop new habits. You can start the habit of paying yourself interest that you would have normally paid to banks, while keeping it safe from taxes.
Note: Life expectancy has increased dramatically in recent years. By using a dividend-paying life insurance policy, you keep the guaranteed cash value, plus interest and dividends, which can become enormous over time.
CREATING THE ENTITY
WITH TERM INSURANCE, YOU RENT OUT A SINGLE PREMIUM OVER A LIMITED PERIOD OF TIME. Insured people pay larger and larger premiums as they get older, until the premiums are too expensive. A few years after giving up the policy, most people die without ever receiving a payout!
WHEN INSURANCE COMPANIES CREATED PARTICIPATING WHOLE LIFE INSURANCE… It had more in common with banking than with insurance.
TAKE THE EXAMPLE OF THE COMMON POTATO. Conquistadors in 1500’s Spain brought potatoes to Europe. Originally, no one would eat them because they were thought to be poisonous. LATER, EUROPEANS DEVELOPED A LARGE SCALE DEPENDENCE ON THE VEGETABLE. Now, one year’s crops of potatoes are worth more than all the gold in the Western Hemisphere.
CREATE A FAMILY BANK BY OPENING A PARTICIPATING WHOLE LIFE INSURANCE POLICY. Add a Paid-Up Additions rider on the policy to reinvest the dividends.
GET AS MUCH MONEY AS POSSIBLE INTO THE POLICY WITH THE LEAST AMOUNT OF Insurance. A 20 year paid-up plan works well for this purpose.
COMPOUND INTEREST OVER A LONG PERIOD OF TIME WITH NO TAXATION ON THE BUILD UP
WHEN YOU BUY REAL ESTATE, YOU USE THE MAGIC OF LEVERAGE. YOU EITHER BORROW MONEY AND PAY INTEREST TO A BANK OR TO YOURSELF. You won’t see results for a long period of time while it grows, just like a forest takes time to grow.
SUPPOSE YOU HAVE 4,000 ACRES OF PROPERTY AND DECIDE TO GROW TREES ON A 40-YEAR ROTATION. You divide the land into 40 compartments of 100 acres each, to manage.
EACH YEAR YOU HARVEST ONE PART AND REPLANT IT. You remove less healthy trees to make room for the healthier ones, and let them grow for 40 years.
ENJOY THE ULTIMATE HARVEST. After 40 years only the strongest, best quality trees grew because of your stewardship, and now you have a rich and bountiful harvest.
MONEY WON’T BUY HAPPINESS, BUT POOR STEWARDSHIP OF MONEY WILL STEAL HAPPINESS.
The retirement trap
NELSON NASH WROTE, “SOCIAL SECURITY WILL FAIL, AS HAVE ALL SOCIALIST PROGRAMS SINCE TIME BEGAN. BEFORE IT FAILS, THEY WILL ATTEMPT TO PROP IT UP. THE SOURCE OF FUNDS THEY WILL USE IS THE RESERVES OF PRIVATE PENSION PLANS AND OTHER GOVERNMENT SANCTIONED SCHEMES.”
The most dangerous thing you can do with your money, Is put it in government sponsored schemes.
When the government causes a problem like over-taxation, And then creates an exception to the rule, such as tax-sheltered retirement plans; aren’t you a little suspicious?
Believing the government will take care of you is a disease. It operates on a faulty premise.
Advantages to becoming your own banker
THE POOL OF WEALTH CAN LAST OVER MULTIPLE GENERATIONS. This promotes long range and estate benefit planning.
BUILD CASH VALUES OVER A LONG PERIOD OF TIME; TAX-FREE. Start up costs are very small compared with the ultimate yield.
THE GENERATION PAYING THE PREMIUMS CAN AFFORD THEM. When the death benefit occurs, the system is self sustaining.
THERE IS NO NEED FOR GOVERNMENT SUPPORT AT RETIREMENT; Passive income is assured.
WEALTH MENTALITY IS PASSED ON TO FUTURE GENERATIONS. This promotes the understanding of financial stewardship, as children learn to take out policy loans and pay themselves back.
THE POWER OF COMPOUNDING
1 CENT IS THE SMALLEST UNIT OF CURRENCY IN NORTH AMERICA. THE FOLLOWING EXAMPLE ILLUSTRATES THE INCREDIBLE POWER OF COMPOUNDING.
GRAB A CALCULATOR AND TRY IT YOURSELF, OR HAVE A CONTEST WITH YOUR FAMILY TO SEE WHO CAN DO THIS THE FASTEST.
START WITH 1 CENT, DOUBLE THAT ON DAY 2. THEN TAKE THE 2 CENTS FROM DAY 2 AND DOUBLE IT. KEEP DOUBLING THE AMOUNT FROM THE PREVIOUS DAY UNTIL YOU REACH 30 DAYS. ARE YOU SHOCKED THAT 1 PENNY CAN BECOME $5.4 MILLION DOLLARS IN JUST 30 DAYS?
AT CHILD MILLIONAIRE, WE SPECIALLY DESIGNED A WELL STRUCTURED, HIGH CASH VALUE, FLEXIBLY OPTIMIZED, PARTICIPATING DIVIDEND PAYING WHOLE LIFE INSURANCE CONTRACT.
THIS ALLOWS YOU TO CREATE A FAMILY POOL OF MONEY WITH SMALL MONTHLY CONTRIBUTIONS, MUCH LIKE THE PREVIOUS POLICY EXAMPLE. THE “INSURED” IS THE CHILD THE POLICY IS BASED UPON.
BY PAYING $200 A MONTH FOR 20 YEARS, YOU CAN ENSURE YOUR CHILD OR GRANDCHILD HAS 3/4 OF A MILLION DOLLARS BY RETIREMENT AGE.
YOU CAN CUSTOMIZE MONTHLY CONTRIBUTIONS STARTING AS LOW AS $50 A MONTH, FOR 20 YEARS.
WATCH HOW THE AMOUNTS COMPOUND RAPIDLY, STARTING AT ABOUT AGE 50.
THE MORE YOU CONTRIBUTE THE GREATER THE COMPOUNDING EFFECTS
BY PAYING $500 A MONTH FOR 20 YEARS, YOU CAN ENSURE YOUR CHILD OR GRANDCHILD HAS ABOUT$2 MILLION DOLLARS BY RETIREMENT.
YOUR CHILD CAN CONTINUE PAYMENTS AFTER THE 20 YEARS TO GROW AND STORE LARGER AMOUNTS OF CAPITAL.
OUR GOLDEN CHILD PROGRAM ALLOWS YOU TO MAXIMIZE WEALTH BY HAVING THE CHILD CONTINUE CONTRIBUTIONS
While the contributions from the parent or grandparent may end at age 20, with the right stewardship, the child, now an adult, can continue to build a nest egg. Even small monthly contributions have a dramatic effect on the cash value by retirement age.
If the parents or grandparents had made $400 contributions, and the child continued at $200, the cash value increases from about $1 million to almost $1.4 million dollars at age 65. At age 75, that increases from $1.6 million dollars to almost $2.2 million.
THE GOLDEN CHILD PROGRAM
Using the capabilities of the Golden Child program, your child learns financial stewardship by putting it into practice. At the same time, continuing contributions multiplies the compounding effects on the cash value. Your children will be excited to save and grow capital, and take responsibility for their own finances, which will help them make financially responsible decisions for a lifetime.
Final Points to Consider:
- THERE ARE ONLY 2 TYPES OF MONEY
- PEOPLE AT WORK
- MONEY AT WORK
- IF YOU KNEW YOU WOULD GET THE ENTIRE AMOUNT OF YOUR POLICY BACK, TAX-FREE, HOW MUCH EXTRA MONEY WOULD YOU PUT IN?
- If you put your money in someone else’s bank, that person gets all of your money. If you owned your own bank, wouldn’t you do all your business through it?
- Creating your own bank can take about 20 years, but a constant money compounding machine is achieved for future generations.
- When the government causes a problem like over-taxation, and then creates an exception to the rule, such as tax-sheltered retirement plans, aren’t you a little suspicious?
- Wealth has to be put somewhere:
The stock market
- You finance everything you buy. You either pay someone else interest or keep that interest in your family bank.
- Over a lifetime, your need for finance exceeds your need for life insurance. With whole life insurance, you will build up massive cash values as well as get access to free life insurance.
- September 1993, Fortune Magazine stated, “If you understand what’s really happening, you’ll know what to do.”
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