It’s difficult to retain a sense of privacy in the world today. You can barely shop in retail now without being asked your phone number or zip code. The same rule applies to any time you go into a bank. Before any financial transaction is completed, a bank will require a detailed financial history. They will run a credit check without flinching, deny credit lines, and allow creditors to know where your assets are and how to access them at will. It’s an intimidating thought. Yet, thankfully there are some important points to follow to protect your financial privacy.
Remove Traditional Banks from the Equation
The very word “bank” sounds secure. It’s even part of everyday vernacular, as in “you can bank on it.” While not disputing the effectiveness of a liquid checking account, the investment potential is low. Banks are businesses that don’t care about your financial privacy. Even now, they have meticulous and detailed financial records on you. These records directly affect your business relationship with them.
Using Cash Value Life Insurance to Privatize Wealth
To keep your assets protected, it is necessary to seek a solution outside of the traditional system. Oddly enough, one of the oldest methods of financial planning and security – Whole Life Insurance – is that solution. This type of policy allows you to become your own bank and have access to the cash value of your policy to loan yourself money. The security comes with the private contract guaranteed by a mutually-owned life insurance company.
Having Total Control Over Your Borrowing Power
Borrowing against the cash value of a whole life insurance policy means that you aren’t beholden to any bank saying you may or may not qualify for a credit line. You are the bank. You make your rules, including setting the interest rate and repayment terms.
Mitigating Interference at Tax Time
The government expects complete transparency when it comes to your financial matters. Whole life insurance plans comply well with that expectation. A mutually-owned insurance company makes it so Uncle Sam has limited ability to take your hard-earned dollars, even when your policy pays out dividends. Truth it, when you reinvest your dividend payments back into your policy as paid-up additions, the government cannot tax them at all.
Financial Privacy is possible. This doesn’t exist in the traditional banking system, which stores and shares your financial history. A cash value life insurance policy will allow you to privatize your wealth, give you control over your borrowing power and limit the government’s interference at tax time.
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