069 | The Hidden Power of Whole Life Insurance for Business Owners with Mark Willis

[00:00:00] Patrick Lonergan: What if you could become your own bank, build tax free wealth, and create a financial safety net that protects your business without relying on traditional lenders? Sounds too good to be true? Well, it’s not. Welcome back to another episode of the Vital Wealth Strategies podcast. I’m your host Patrick Lonergan, and today we’re diving into a game changing strategy for entrepreneurs and business owners.
[00:00:24] Patrick Lonergan: Joining me is Mark Willis, a number one best selling author. Owner of Lake Growth Financial Services and co host of the Not Your Average Financial Podcast. Mark specializes in helping business owners achieve greater control and predictability in their finances using a powerful yet often overlooked tool, properly designed whole life insurance.
[00:00:44] Patrick Lonergan: In this episode, we’ll explore how to protect your business, build liquidity, and escape the grips of volatile markets and restrictive banking systems. We’ll break down how you can transform life insurance. Into a strategic asset giving you the ability to finance your business, secure tax-free income in retirement, and safeguard your future all while growing your wealth.
[00:01:04] Patrick Lonergan: Stay tuned until the end to learn how these strategies can help you retain key employees, enhance your business value, and create long-term stability. If you’ve ever wondered how to add certainty and security to your entrepreneurial journey, this episode is for you. Let’s get started real quick. If you’re an entrepreneur pulling in seven figures and still overpaying in taxes.
[00:01:25] Patrick Lonergan: It’s time to fix that. The vital strategies we’ve helped business owners legally cut their tax bill by six figures or more. Visit vital strategies. com forward slash tax. And let’s talk Mark Willis. Thank you for joining us here today. I’m excited about this conversation. We’re really going to dig into the entrepreneur and, uh, just.
[00:01:45] Patrick Lonergan: All the different strategies that we can help them with, because when we think about the entrepreneur, they have a unique set of problems. They, they generally have more ideas than they have time and energy to execute on. Then they’re also running this real volatile business. So when we have extra liquidity, it, uh, is awfully nice to help sustain things when things go sideways.
[00:02:02] Patrick Lonergan: So. I appreciate you, you joining us here today. You’re a number one bestselling author and the owner of Lake Growth Financial Services in Chicago, and you co host the Not Your Average Financial Podcast. So I thank you so much for joining us here today. I’m excited. Oh, thanks Patrick. Thanks for having me on.
[00:02:18] Patrick Lonergan: Yeah. Um, this is, this is going to be good. You know, when I think about the, the entrepreneur, you know, there’s, there’s all sorts of, uh, challenges and we, we highlighted a few of those, but you know, we can think about. Just how hard it is to be a business owner and just the day to day challenges. And then we think about retaining our top people and, you know, what happens if, you know, the, the market does something wonky and I, I, you know, need to go tap into cash reserves and I’ve not done a good job saving for those.
[00:02:46] Patrick Lonergan: So I think we’re going to get into lots of those, those pieces. But, uh, before we do that, can you just give us a little bit of your. Your background and, uh, talk a little bit about what your firm
[00:02:54] Mark: does. Sure. Yeah. We work with business owners and business investors, real estate investors, and even some NFL super bowl champions, uh, as it happens.
[00:03:04] Mark: But everyone we work with has one thing in common and that is they want more agency certainty control. Uh, certainty in their financial life. Uh, so many business owners that I work with complain, they’re like, Mark, you know, I got into business for more control, not less. And they oftentimes feel, in not so many words they’ll say, but they feel like a tennis ball just sort of floating down the gutter of their lone life when they wanted to be swimming upstream, financially speaking, and otherwise as well.
[00:03:36] Mark: I mean, the certainty, control, the agency, the thrill of being a business owner is often replaced with basically just paying for a very expensive job. And even as you enter into seven figures and even eight figures and beyond, you’re in that weird, awkward teenager phase of your business where maybe you were a successful solopreneur.
[00:03:59] Mark: And you’re figuring out the who not how at this point, trying to fire yourself from the, all the daily grind of your work so you can get to more visionary or integrator status, whatever. But so many people I work with are looking for more, how do I Bacon, more predictability and income or liquidity, some sort of asset on the balance sheet that I can rely on that isn’t subject to the whims and thrills and terrifying dips of the stock market and have some tax advantaged assets that I can rely on both now and also in retirement income.
[00:04:37] Mark: So, uh, that’s all we focus on is how do we help the entrepreneur, which I think is the, the. I don’t want to say save your, maybe that’s too strong a word, but the, the, the linchpin of our economy, uh, and help our economy really
[00:04:50] Patrick Lonergan: thrive in the years to come. I love that. And it’s so interesting. You say that I was meeting with an entrepreneur yesterday that makes over 2 million a year.
[00:04:59] Patrick Lonergan: And he was like, can we start every meeting with you just telling me I’m not going bankrupt tomorrow, you know? And it’s, and I hear that and I’m like, oh my gosh, you know, uh, just the. I think the insecurity that comes with being an entrepreneur, because, you know, we think about a job. I go to work and I, I put in the time and the energy and I get a paycheck, right?
[00:05:20] Patrick Lonergan: Like there’s, there’s direct results. I put in the dollars or I put in the time I get the dollars. As an entrepreneur, we all have plenty of experience putting in the time with no financial return on that. You know, we’ve invested a lot of time and energy and it’s like, Oh, that didn’t pan out the way that I thought it would.
[00:05:35] Patrick Lonergan: And so I think it, it creates a little bit of uncertainty for us that, uh, you know, is tomorrow going to be okay. And, uh, it was just so interesting to hear this entrepreneur express that to me. And so. I think another interesting point too, is if we think about how we get on the Forbes list, right? The most wealthy people on the planet, it’s a concentrated position with leverage, right?
[00:05:56] Patrick Lonergan: So I’m, I’m using financing and I’m, uh, holding all of my stock in Tesla, Amazon, what have you, right? But that is not the recipe for long term stable financial success, right? It’s, it’s taking some of those dollars out of that leveraged, concentrated position and going, okay, how do I make sure that I’m secure?
[00:06:16] Patrick Lonergan: I like my wealth building piece, but I, I’d like to take some of these chips off the table and make sure that, um, you know, all this effort and energy that I put into my business is, is protected. So I’m, I’m excited about, uh, this, this conversation. Getting into the different ways that we can do that.
[00:06:32] Mark: Wonderful. Yeah. I totally love your idea and you’re right. I think there’s that, that, uh, concentrated position with leverage. I mean, there was a recent data dump. You may have heard of this, the ProPublica tax return, Lee, the treasury department leak. Uh, and you probably could share more about this than I could, but I was surprised at how many billionaires information was made public talk about a crime, you know, I mean, I hope that.
[00:06:58] Mark: I mean, if that happened to the average Joe, there’d be outcries, but it was almost like a sneak peek into a wealth building system when the, when the 25 billionaires, you know, Mark Zuckerberg, uh, Carl Icahn, Elon Musk, uh, Michael Bloomberg, the list went on and on. They all follow a very similar pattern. And we can get into some of that if you’d like some of those ways in which they Have a concentrated position with leverage and something that even if you’re not, even if your last name doesn’t rhyme with Schmuckerberg, you can follow the same path, uh, with a lot less risk if you know what you’re doing.
[00:07:33] Patrick Lonergan: Yeah, no, I’d love to dive into that. So do you want to sort of, uh, you, you’ve teased us with a little bit of that information. Can you, can you. Pull back the curtain and share with
[00:07:42] Mark: us. Well, again, I’m a business owner myself, so I love the idea of leverage. And the funny thing about leverage is it works so well, and it can also be used against us.
[00:07:54] Mark: Leverage works both ways. People love the idea of OPM, other people’s money, until they realize that oftentimes the other people want their money back.
[00:08:03] Patrick Lonergan: Right. Right. Yeah. I think the, you know, the, the Bible tells us, uh, not to, it doesn’t tell us not to take debt. It just comes with a sort of like warning sign, like, Hey, slave to the lender, right?
[00:08:15] Patrick Lonergan: Like if you, you take on this position, you owe somebody some money and it goes sideways, uh, it’s going to be a problem for you. They’re, they’re going to own you in some capacity. So, uh, yeah, you’re, you’re absolutely right. It can create. It can cut both ways. It can create fantastic upside and growth. Uh, but if, if things go sideways, it can be a mess.
[00:08:34] Patrick Lonergan: I
[00:08:35] Mark: think the, the idea of ownership is a big one. So, you know, when I became an entrepreneur, when many business owners became entrepreneurs, it was to have self ownership and then they fall right into the lap of a bank. And the bank is the one that really runs the show. They tell you what you need to pay them.
[00:08:53] Mark: They are a silent partner, you might say. And they demand payment, regardless of the income coming and going out of your business. You are their annuity. You are their guaranteed income stream. And if you don’t pay them on time, every time, what do they do? Oh yeah. They come to collect, they send their uncle Guido out, and then you’ve got to kiss the ring of the banker and hope and pray that you can, as you said, not go bankrupt tomorrow.
[00:09:20] Mark: Right, right. Yeah,
[00:09:21] Patrick Lonergan: yeah.
[00:09:21] Mark: And
[00:09:22] Patrick Lonergan: I think you’re highlighting some really critical points. Uh, they’re, they’re misnomers about the entrepreneur. I think the, the general public thinks the entrepreneur has all the time and all the money. Uh, and they, they’ve got this sort of immense freedom. And at the end of the day, you highlighted a piece of, you know, when you factor in leverage.
[00:09:40] Patrick Lonergan: They don’t have a ton of freedom. Um, they’re the last ones to get paid. Everybody else gets paid first. And if there’s any money left over, they, they, they get that. And then the freedom piece, right. Or the time piece, if, if there’s something to be done and nobody else is doing it, guess who it falls to, right?
[00:09:56] Patrick Lonergan: The guy that owns the business. So, uh, you actually, the last one to get paid, you know, rarely have a ton of free time, and then you’ve got to answer to. You know, the banks, when you thought you weren’t going to have anybody to answer to. So I, I love these distinctions. Well, we’re really painting
[00:10:11] Mark: a not so rosy picture.
[00:10:13] Mark: Hopefully we haven’t scared anybody away from starting a business, but, uh, there are plenty of shadows to the sunny side of starting that business for sure.
[00:10:21] Patrick Lonergan: Absolutely. And, and I, I think as, as finance people, as financial advisors, right? If we just look at the statistics alone, I think we’re hard pressed to give somebody the advice to go start your own business because statistically speaking, it’s not going to work out for you.
[00:10:35] Patrick Lonergan: You know, it’s, it’s a lot of work for, uh, probably a lower paying job than you could have just gone out and got, um, right. At least at the beginning. Now, if you succeed, it can be, it can create. Tremendous opportunity for you, you know, financial opportunity, freedoms, uh, impact, all of those things can, can come your way because you were a successful business owner.
[00:10:56] Patrick Lonergan: And I think there’s some people that are just wired to, like, I, I don’t know if I’m employable. Um, I, I think I would get into an organization and go, Hey, there’s, there’s new ways, exciting ways to do things. Let’s go fix them. And they’d be like, Stop breaking things. You just go do what I hired you to do.
[00:11:11] Patrick Lonergan: And, uh, I’d be like, well, I’m going to go start a competitor business set that’s sort of where my, my brain would be. Uh, so I think some of us are just wired to be entrepreneurs, no matter the risk, uh, profile of, of starting your own adventure. So, um, yeah, this is, this is good. So Mark, do you want to give us a few.
[00:11:29] Patrick Lonergan: Uh, just thoughts and ideas on like, how can we set up a structure where we’re, we’re not necessarily beholden to, uh, the banks and, and looking at some of those, uh, creating some freedom, uh, outside of that.
[00:11:42] Mark: Oh, sure. Yeah. Well, banks certainly are one, you might say villain in the story. I will put one more, uh, paper tiger out there as well that we need to talk about briefly.
[00:11:50] Mark: And that is generally speaking, and I’m going to tread lightly. a little bit lightly here, but most financial advisors or accountants or CPAs will tell an entrepreneur to put their money into financial assets that can run counter to the success of the business. Now, I am a believer in IRAs, SEP IRAs, I have these myself, you know, but How much access do we have to that IRA or SEP IRA or 401k when we need it the most, which is when we’re trying to start up a business?
[00:12:25] Mark: Obviously, the answer is not much at all, really not any at all. Uh, and you know, where is that money typically going? It’s going into other similar, oftentimes similarly risky, uh, assets that we have no control over. Stocks, bonds, mutual funds, ETFs, target date funds. And all of this adds to the risk of the overly risky portfolio of every entrepreneur.
[00:12:49] Mark: What is a business? Well, it’s a, it’s a collection of capabilities as someone once said, and those capabilities are. Risky, because as you said, you know, Walmart could come in and disrupt your industry that robots could take over your industry or whatever you could be out of job tomorrow through God forbid, a lawsuit or something.
[00:13:06] Mark: So it’s a risky place. And where do most, I’ll ask you this question, just generally speaking, Patrick, where do most people, most entrepreneurs keep the vast majority of their net worth? Is it in, you know, typical stocks and savings accounts, or is it in their business?
[00:13:21] Patrick Lonergan: Uh, it’s most of the have it in their business, right?
[00:13:24] Patrick Lonergan: They’re, they’re holding it in this fairly illiquid, uh, enterprise that, um, you know, they’re, they’re investing a ton of their time and energy. And
[00:13:32] Mark: so one problem is the banks because they will collateralize your entire asset base in your business. Hey, you want a loan from us? Oh, well, Hey, we’ll just freeze all of your assets and then suck your suck your business dry.
[00:13:47] Mark: And if you don’t pay us, we’ll just collect all your. Kitchen equipment or your construction equipment or your trucks or whatever you’ve got there. And that’s how most businesses finally give up the ghost right there. On the other side of the equation, you’ve got any money. You do have any savings slash retirement savings.
[00:14:03] Mark: You put away is in stuff you can’t access without penalties and taxes galore. And not to mention there’s fees baked into that. And the Department of Labor actually says that a 1 percent fee on an IRA over a 35 year period, typical length of time for retirement, is going to gobble up 28 percent of your life savings.
[00:14:26] Mark: Yeah, an incredible number. I’m having a heart attack just thinking about that. And that’s before taxes. And certainly, you know, you’re paying your fees during your working years on money you’ll never see because that goes to the IRS. So you’re paying the fee for the government to take money out of your IRA when it’s time to retire.
[00:14:43] Mark: I mean, that’s very generous of you, but I don’t know if that’s the right way to go. So anyway, uh, does that mean never have IRA? No, certainly not. We set up those for our clients. It makes great sense for a sum of your financial plan, but let’s think about how whole life insurance of all things can help you defeat The wall street casino and also the banksters.
[00:15:06] Mark: I’ll use that phrase to help you become your own source of financing and not just avoid debt, which I agree with you. The, you know, the Bible does have some certain things to say about finances and debt, but what if you could use the power? Of banking inside your business for your own advantage, much like jujitsu or, you know, like, uh, these, these ideas of taking the force of your enemy and leveraging that to your own advantage, not just being debt free, but being better than debt free what’s better than debt free Patrick being the bank.
[00:15:43] Mark: In fact, um, it’s even said that you’re in two businesses. You’re in the business that you have on your business card or on your teeth, on your collared t shirt and you’re in the banking business, you’re just sitting on the wrong side of the banker’s desk.
[00:15:58] Patrick Lonergan: And, and the thing I love about banking, I’ve always wanted to own a bank because I, I like the fact of the arbitrage side of the equation.
[00:16:05] Patrick Lonergan: I can, I can borrow money from the government at X percent and loan it out at two or three X. And, uh, like. That sounds like a fantastic side of the equation to be on, right? Like I’m just collecting this spread, uh, in the middle. So,
[00:16:19] Mark: uh, very low risk for the bank. Great. Um, you know, it seems like almost you’re creating money out of thin air.
[00:16:24] Mark: And in fact, you are, uh, many people are surprised to find out that the savings account or checking account is a highly risky place to put your money. We don’t have to go into all the reasons why, but I don’t have much faith in the FDIC, especially as we saw, you know, kind of, uh, we had a light shine on that.
[00:16:42] Mark: Reserve quote, unquote reserve, uh, when the banks began to fail in spring of 23, uh, Silicon Valley and, and such as, such as, uh, their list went on last spring. So. So how can we buy a bank? Well, it takes about, you know, 10 to 100 million. You got to be able to wait about a decade and a half to get a bank charter, all of which just to open up a single branch of a tiny little, you know, credit union in your local town there.
[00:17:10] Mark: And that’s going to take a long time. Not many people are ready to do that, but they love the idea of buying a bank. Well, here’s how you could do it without being, you know, um, someone whose last name rhymes with, uh, Schmuckerberg. Okay, uh, so of all things, a properly designed dividend paying whole life insurance policy allows you to function like a bank for your business.
[00:17:35] Mark: Okay, so what, what am I talking about? Most people hear the words life insurance and they think, well that’s the money I’ll leave my family when I pass away. And sure you will. There’s a tax free, income tax free death benefit to your family when you graduate. However, it’s the living benefits that I think we’re going to want to spend maybe more of our time talking about today.
[00:17:56] Mark: Because there’s so many tax advantages to this well forgotten asset class. I mean, it’s hundreds of years old, predates the 401k. By hundreds of years, IRA too, it also predates the IRS and the income tax code, right? When was the income tax code born? It was 1913. Life insurance predates the U. S.
[00:18:19] Mark: Constitution. Whoa! Okay, so let’s dig into what this thing is and what it can do. Here’s, here it is in just four little simple statements. TGIF, I’ll keep it real easy in an acronym too. T, uh, it’s Available income tax free. The death benefit is income tax free. The cash value is liquid and available with no taxes due.
[00:18:42] Mark: If we designed it properly, the growth on the money is tax deferred. Unlike a savings account, which taxes you every year. Think of that for a minute. You know, if you have a 5 percent or a 4 percent money market account, it’s not really getting you 4%, is it? No, because it’s taxing you every year.
[00:18:59] Patrick Lonergan: If I’m in the top tax bracket, I’m at 37 percent plus possibly some state income tax.
[00:19:04] Patrick Lonergan: I might be giving 40 if I’m in California or New York, 50 percent of all of my returns back to the taxing authority. And where, where
[00:19:11] Mark: do most business entrepreneurs keep their operating funds? In the banks. Yeah. Which are taxable. So sure liquid, but taxable. I don’t like that. Keeping my money in something where I’m not using it and I’m still paying tax sounds like a.
[00:19:27] Mark: Yeah,
[00:19:29] Patrick Lonergan: and I think we should also highlight, like most operating accounts are just sitting liquid, not earning anything, you know, they’re, they’re, you know, what’s, what’s worse than giving half of your earnings to the government, not earning anything, you know, it’s just sitting there doing zero. That’s right.
[00:19:44] Mark: Yeah. And there’s certainly limits to the FDIC. And so I don’t know what kind of operating capital, most business owners listening to this are needing, but it’s very easy to go past the 250, 000 limit per account. So first is tax advantages. And if we do it right, income tax free, that’s also including tax free income in retirement.
[00:20:04] Mark: So most IRAs and 401ks are going to be taxed later. Now you’re a tax professional. I know you have other tax professionals on your team. As a tax professional, I don’t know the future. You don’t know the future, but what’s your best guess as you look over the next 30, 50 years, are we going to be going down or up in the tax world?
[00:20:22] Mark: In terms of tax, that’s
[00:20:23] Patrick Lonergan: a great question. I just think about the, the amount of debt that we’re carrying, how fast that started to accelerate through COVID. And if, if we think of, if we just boil it down to a simple analogy, right? Like if, if I’m. If I’m running my household, my personal household, and I’ve got 10, 000 of credit card debt, right?
[00:20:42] Patrick Lonergan: And then all of a sudden something happens in my household and I’ve got to charge that up to 30, 50, 100, 000. Um, at some point I’m going to have to pay that back, right? Like it’s just not something I can kick down the road forever. Like the day will come where I have to. I have to pay that back. And so, uh, especially with rising interest rates, uh, all of a sudden this, this debt snowball gets out of control for me and I can’t stay up on top of it.
[00:21:07] Patrick Lonergan: Now we relate that to where we’re at with our financial situation with the government and that’s where we’re at. We were not even servicing the debt. You know, the, the amount of interest that’s accumulating is just stacking up year over year. And at some point, somebody is going to have to acknowledge that and go.
[00:21:22] Patrick Lonergan: You know what? Uh, this doesn’t make financial sense anymore. We have to get our financial house in order. And the way to fix that is we’re going to have to raise tax in some capacity, right? Now, I think there’s, um, there’s some thoughts that, uh, right now with, with Trump coming into office that, Oh, we’re going to, we’re going to go.
[00:21:41] Patrick Lonergan: Put tariffs on everything and we’re going to let somebody else pay for that. I don’t like any kind of tax personally. Like, uh, I just don’t feel like the government’s, uh, efficient or effective in using anybody’s dollars well. So it’s like, I don’t really care where the money’s coming from. Let’s, um, let’s have less government, but that’s still not going to solve our tax problem.
[00:21:59] Patrick Lonergan: So I’ll get off my high horse. But, uh, yes, I, I do believe that tax rates are going to have to go up.
[00:22:04] Mark: The next question I’d want to know is. If, if folks are agreeing with you, by the way, I do too. And if they agree that tax rates are even 1 percent higher in the future, then mathematically it makes zero sense to defer your taxes in an IRA or 401k.
[00:22:20] Mark: So, First, do you believe taxes are going up? Yes or no? I don’t care about your politics. I don’t care just yes or no It’s a math question. Number two. Do you want to pay those taxes? No, that’s a good question to ask, right? Like if folks can assent to the belief that taxes might go up, but they may never I realize, Oh, I don’t want to pay those.
[00:22:42] Mark: What do I do now? So the first T in our TGIF is tax advantages. There’s more to it. Like life insurance, when you pull money out, it doesn’t count against your provisional income, so it doesn’t affect social security. Okay, so there’s lots more we could go down the road there. Okay, but let’s move on. G, the cash value life insurance, the cash value portion is the money you can access while you’re alive.
[00:23:06] Mark: And that, again, is with all those tax advantages we just mentioned. So it’s liquid accessible money today. Cash value grows on a guaranteed basis every single year, regardless of what the market is doing, regardless of how your business is doing. Can you imagine how comforting it is when you have a unbelievable, terrible, the world is on fire, everyone’s, you know.
[00:23:33] Mark: Naysaying in the news and the world is just coming undone and your policy just hit another all time record high. Every single client of mine with a policy had an all time record high in their accounts last year. And they’re going to have another one this year and next year. That is so cool. And I love giving that kind of good news to my clients every year and it’s contractual, so it’s not like I have to hope and pray or pick the right stock.
[00:23:56] Mark: It just works. And when my business is a high risk investment. And I have a safe asset on the other side of the barbell. I’m able to take more responsible risk inside my business that other people just can’t take.
[00:24:12] Patrick Lonergan: Yeah. Yeah. I love that. And I think about, we talk about minimum and maximum thresholds for liquidity for our clients, but the number one reason businesses go out of businesses, they run out of cash.
[00:24:23] Patrick Lonergan: Okay. So, yeah. And so we, we are looking at those minimum and maximum thresholds and oftentimes those minimum thresholds are. A half million dollars, uh, might be a million dollars on the Mac side. And so, uh, we didn’t get anything above that million dollars should get put to work in some capacity. Right. Uh, but, but man, if I could really leverage and utilize these, these dollars sitting in, uh, liquid cash and get some return, uh, and also protect my business, I think that’s
[00:24:52] Mark: Well, you know, the efficient frontier of investing, you know, if you’ve got a risk free asset over here, can’t you take more risk over here and what is a risk free asset?
[00:25:01] Mark: Oh yeah, whole life insurance. That is a risk free, if it’s guaranteed by a contract, it’s, it’s less risky than your bank account or even other simple accounts that have some amount of, you know, um. You know, counterparty risk. So that’s, that’s a big deal. And if you’re the only business owner in your industry or in your town, let’s say you’ve got, let’s say you run a bar and there’s 10 other restaurants and bars in your town, all of which are using the debt banker.
[00:25:30] Mark: You know, typical models, right? But you’re sitting on three quarters of a million dollars of liquid money inside your whole life policy, growing at a productive rate, nothing fancy, middle, single digits, tax free yield, four, five, 6%, whatever. And that money is liquid and available to you. And it grows every year.
[00:25:50] Mark: How do you think you’ll do as compared to your competitors as a. Professional yourself, what would you say, would that help that business?
[00:25:57] Patrick Lonergan: Absolutely. Yep. It’s just a, uh, stability in a volatile world and, and they’re also growing and developing their wealth outside of the business, which I think is fantastic.
[00:26:07] Mark: That’s a big part of the equation. Build that diversified portfolio. You don’t want all your eggs on one, in one basket. Many people think, well, that means put a bunch more in stocks. No, it doesn’t. You need, we need non correlated assets. If all your eggs are in 12 baskets, well, that’s good. But what if your 12 baskets are on the same truck and it goes off a cliff?
[00:26:29] Mark: That can happen. So put some money on, in other assets, put your eggs, some of the eggs in other trucks, you might say. Okay. So the, the I is insurance T G I F. So the insurance is a big deal. It’s actually, you might say a permission slip. To be able to spend down your other money, because when you know, your family, your spouse is going to get a big tax free income windfall.
[00:26:52] Mark: When you pass away, it gives you the freedom to be more aggressive in your withdrawal rates on your 401ks. If you have them IRAs, if you have them real estate properties, whatever, it’s a, literally a. Spend down permission slip, and that’s a big relief to a lot of people. Also, if you’re a high net worth person, it may be a shield against estate taxes, either on the federal level, or if you like in Illinois, there’s a estate tax.
[00:27:18] Mark: There are in other states as well. Shielding you from that estate tax, uh, is what the life insurance is great at doing. Okay. And then finally, the F is financing. Uh, so. Quick story, there was a business owner who had a million dollar line of credit with his bank, and he used that line of credit all the time to operate his business, until one day.
[00:27:40] Mark: Now, he was a great customer. He paid on time every time. He sure had his tight spots and good spots, but the bank ran into trouble. It wasn’t even his problem. Wasn’t even the world economy. It wasn’t the bank ran into trouble and they said, I’m sorry, Mr. Client, but we’re terming out your loan. And so we want you to pass a million bucks over the next three to five years.
[00:28:03] Mark: And I think they gave him a specific date. I think it was somewhere around three or five years. So he was furious. He was, he was scared. He didn’t know what he was going to do. So thankfully we sat down and we set up a bank on yourself, designed whole life policy. He just. Packed tons of money into that thing so that by the time his million dollar line of credit gone, he had a million dollars in his life insurance policy, he became his own source of financing.
[00:28:32] Mark: And here’s how that happens. Cash value, life insurance, if it’s designed properly, I know you’re familiar with this in some, uh, you can borrow against it. Like a line of credit for yourself. I call it a me lock. All right. So instead of a home equity line of credit, it’s you, it’s, you are your own source of financing.
[00:28:50] Mark: You borrow against your life insurance and it works like a bank for yourself. And different than say a savings account, like you, you know, you can withdraw money out of your money market or savings account, but then the money’s gone. It’s no longer earning interest. The little it might’ve earned in the first place.
[00:29:09] Mark: But when you borrow against one of these policies, if it’s truly designed the right way, the policy will continue to grow and earn interest as if you had not touched the money in the first place. It grows on the full capital, even the amount you borrow against. So if this guy or a few, or if anyone listening, if they had a million dollars of cash value and they borrow out 800 grand, a farmer client of mine did this exact same thing.
[00:29:33] Mark: He had borrowed 800 grand to do a combine purchase. His policy continues to grow and earn interest and also dividends. If those are available on the full million bucks, as if he had never touched the money. To me, that’s the business owner. A lot of
[00:29:49] Patrick Lonergan: heartache. It does. It does. And, um, and correct me if I’m wrong here, Mark, but if I’m.
[00:29:57] Patrick Lonergan: If I’m borrowing those dollars out and the, the initial cash value, let’s say the million dollars is growing it. Let’s keep the math simple 5%. Okay. So I’m, I’d get every year, 50, 000 of cash growth, uh, on my, on my million dollars. And then I borrow 800, 000 out at 4%. I don’t know if that spreads correct or not, but now it’s costing me 32, 000 a year that I’m still, I still have the arbitrage.
[00:30:24] Patrick Lonergan: One of the things we were talking about earlier, right? Like, I still have the spread there. I’m, I’m earning it X percent, which is, and then borrowing out at X minus a percent. And, uh, I’m coming out. Uh, ahead in that scenario, is that, is that an accurate assessment on precisely
[00:30:38] Mark: correct? Yeah. Yeah. In fact, the rates are a little bit better than that because again, if it’s designed properly, not all insurance companies, I would not recommend you just call up your local insurance guy to do this because not all insurance companies and not all agents know what this even is.
[00:30:54] Mark: But if it’s properly constructed and you have a financial professional, who’s doing this well for you, loans are simple interest at certain companies, simple interest. So you’re paying down principal all year long, and you’re not compounding that loan interest when you borrow against the policy. So the.
[00:31:11] Mark: APR, if you repay your loan, let’s say over four years, the APR is going to be closer to 2%. Um, and while your policy continues to compound on the entire cash value, arbitrage is the best word of the, of the, of the entire episode, man. Uh, and that’s a 20 cocktail term. Basically, it just means you earned more than you spent to borrow this money.
[00:31:34] Mark: Now there’s no magic here. I don’t want to try to, you know, you know, tell folks otherwise. There’s still patience here. You got to be willing to sock money into it. It’s not money for nothing. You’re you, you know, you cannot do this if you don’t have the ability to save money or have nothing else saved to set aside, you got to fund your policy.
[00:31:55] Mark: What bank opens its doors without some money in the vault? So you have to be, you have to be able to save and you have to be. Comfortable with a conservative growth trajectory for this money in the policy. Yep. Yeah.
[00:32:10] Patrick Lonergan: And I think you’re, you’re making some very, very key distinctions. Um, this is not, this is not my Nvidia stock, right.
[00:32:17] Patrick Lonergan: Uh, and let’s not pretend it’s an Nvidia stock, but what it is, is it’s a, when we think about our liquid assets, it is. A leveraged asset because I get the leverage of the death benefit. It’s leveraged because I get, um, you know, a tax free return. You know, it just goes back to your TGIF, right? Uh, there’s, there’s so many different opportunities inside of there that, uh, when I’m comparing it to cash, cause I think that’s a great comparison when I’m comparing it to cash in the bank.
[00:32:47] Patrick Lonergan: It’s got all of these pluses to, to its, uh, to its side of the equation. And, and I think just practically speaking, right, Mark, if I’ve got a half a million dollars in a bank account, systematically moving some of those dollars into a whole life insurance, I want to talk about. That in just a second, but I move systematically dollars into a whole life insurance policy.
[00:33:08] Patrick Lonergan: Now I, I really am not depending on how it’s designed, but we’ve seen them designed very efficiently where dollars going in, you know, are almost to a big percentage available immediately. Um, so I moved those dollars into the plan, you know, I’m really not affecting my liquidity too much. Uh, and then. Over time I can get all of the dollars into, you know, the life insurance policy and then I can use it, uh, anytime I need for, you know, we’ll call it capital projects, cash needs, you know, that type of thing is that, is that a.
[00:33:39] Patrick Lonergan: Is that a fair assessment on just thinking through strategy? Precisely.
[00:33:42] Mark: And you’re exactly right. This shouldn’t be seen as an investment. It’s a cash allocation in your portfolio. You still want to be putting money in other assets that have potential, but no guarantee of higher yield than this. But this beats your alternatives to cash for sure.
[00:34:00] Mark: And I always tell folks, this is not an either or it’s a both. The end. You know, what’s to stop you from borrowing against your life insurance and investing, you know, you, you get the arbitrage in the policy and you get the potential yield on the investment, even your business or a real estate deal you find, or, you know, even in video getting, you know, if that’s your jam now, you know, buyer beware with all things, right.
[00:34:24] Mark: There’s no guarantee. But what an opportunity. Uh, and then you mentioned, um, yeah, you can use it at any time. So if we’ve designed them properly, you will have cash value within the first 20 to 30 days of starting one of these policies. A lot of folks think you got to wait years. It’s just not true if it’s designed properly.
[00:34:41] Mark: I
[00:34:41] Patrick Lonergan: love it. And I, one other, if I can geek out for just a second with a whole life policy, uh, we saw this a few years ago with interest rates, right? Uh, if we think about a bond allocation, okay. As interest rates rise, okay, if anybody’s watching this on video, as interest rate rises, my bond value decreases, right?
[00:35:01] Patrick Lonergan: Cause that, that bond has a maturity date and it’s got a market value. And so that goes down. And the same thing is true when interest rates go down, my bond value goes up. So we think about the environment we’ve been in lately. Uh, it’s been pretty low interest rates. They’ve come up recently. They’re starting to trend back down.
[00:35:17] Patrick Lonergan: But one of the things about. The whole life insurance is it really has no interest rate risk. If interest rates go to the moon, there’s nothing stopping me from borrowing money out of my policy and going investing it at 18 percent in a CD, right? Like I can, I can sort of double dip. I can borrow it out at, you know, maybe, you know, some lower rate and, and reinvest it.
[00:35:38] Patrick Lonergan: Uh, and, and so I can, I can almost shift that, that safe asset to another category that might be performing better in the short term. Um, and so, I don’t know, I, I think having, you know, Again, just thinking about all the safety factors, right? Uh, I could go put it in a bond, but that that’s. There’s still some risk with bonds and people forgot about that because interest rates came down for almost 40 years, isn’t it?
[00:36:00] Patrick Lonergan: And then they start going back up and they’re like, why am I losing money in my bond portfolio? It’s like, well. Because this is how it works. So good.
[00:36:06] Mark: Well, and just tag along with you on this. You’re right. All of what you said is correct. And the whole life policy itself is mostly tied to the overall world and interest rates.
[00:36:18] Mark: Look at, look at dividend rates on whole life policies in the early eighties. They were double digits, you know? Uh, so as we’ve seen rates. Going up lately, that’s been good news for the yield on these whole life policies. I’m actually, I’m kind of cheering on these higher rates because it’s been so long with such low rates.
[00:36:37] Mark: It’s been wonderful to see my policies perform better than originally planned.
[00:36:41] Patrick Lonergan: Yeah. Yeah. I love it. And now, Mark, I want to, I want to dig into the difference between. Um, and maybe we can spend just a minute defining some of these, but I’ve got whole life insurance, I’ve got what I’m going to call the universal life chassis.
[00:36:57] Patrick Lonergan: Okay. Um, and I can have sort of a traditional UL, which is going to act like a CD for lack of a better term, it’s going to respond to interest rates. I’ve got a VUL, which is a variable universal life policy, which I can own basically stocks and bonds inside of my, uh, life insurance contract. And my cash value can go negative.
[00:37:15] Patrick Lonergan: If that portfolio goes, you know, the wrong direction. And then I’ve got a, uh, an indexed universal life, which has become sort of more popular lately, which for lack of a better term has some floors and ceilings, right? Like, and they’re, they’re based on market performance and it could go up to a certain value and it’s kind of capped and it can go down to a certain value and it’s kind of capped.
[00:37:34] Patrick Lonergan: So, uh, I don’t know if you want to get into any more distinctions on those, but I’d be curious why you. Favor, whole life insurance versus some of the other varieties out there. Well,
[00:37:43] Mark: um, they’re all just products and they all do different things, right? So, you know, pay more attention to the swing, less attention to the club.
[00:37:51] Mark: That’s the only way you’ll play like tiger woods. You know, I’d rather have his swing than his clubs. Uh, with that out of the way, um, what is it we’re trying to accomplish? If, if safe tax advantaged. Banking strategies are the goal, then only whole life allows us to do that. And here’s what I mean. Um, Universal life chassis, whether it’s indexed or just traditional universal has an increasing cost component.
[00:38:20] Mark: Think of it almost like annual renewable term insurance with a side fund in some sort of an index or an interest rate. So I love the indexing part. It’s a beautiful idea. You know, zero is your hero and all that. And the ability to grow up to some index limit or cap, you know, watch the S and P 500. If it goes up, you win.
[00:38:40] Mark: If you go, if it goes down, you stay flat at zero. Love it. And we like some indexing tools, just not the life insurance parts. I like indexed annuities sometimes, for certain circumstances, for example. However, Uh, a indexed universal life and other universal and variable products all show and you got to look at the contract carefully, but they all show as you age, you’re getting more expensive to keep your body insured.
[00:39:07] Mark: And we cannot stop those birthday candles coming at us, man. They’re like bullets. And as you age, it gets more expensive and the market doesn’t always have the ability to keep up with our aging expensive body. And so you will see. And in fact, a recent study came out and said that 89 percent I can get you the stat.
[00:39:26] Mark: If you want to put it in the show notes, 89 percent of a universal life contracts will not pay a claim. They will lapse before they are paid out. That’s a lawsuit in my opinion, waiting to happen. I have contracts that allow me to write universal contracts and variable. I just. Believe it’s a liability to my business.
[00:39:46] Mark: And as a fiduciary, just not willing to go there. I’m not saying there’s never a case for them. I certainly don’t want to step on anyone’s toes that loves those, but I personally see the banking policy only working the style and function of banking should be used with something that will never. Get more expensive as we age.
[00:40:06] Mark: And that’s only whole life insurance. And, and I would particularly say bank on yourself designed because there’s lots of bad whole life out there too. You really want to make sure I kind of jokingly say it’s sort of like an airplane. Uh, you know, an airplane takes hundreds of different dials and levers to nuance that thing, to engineer it properly.
[00:40:24] Mark: All you want to do as the business owner listening to this today is just get on that airplane and fly to your destination. It’s up to the professionals to design that thing, fly it properly to where you want to go. It’s sort of like that with these policies.
[00:40:38] Patrick Lonergan: Yep. I love it. Thank you for that, that distinction.
[00:40:41] Patrick Lonergan: I think that’s, that’s really good. And, and I do want to go back to really your point on whole life insurance as a tool, it’s a tool in our tool belt, just like universal life and index universal life and all those other things. And it’s like, when we’re trying to accomplish this certain outcome, this is, this is the tool we like to use because you know, right?
[00:41:00] Patrick Lonergan: Like I can, I can probably. Drive a screw into the wall with a hammer. I can probably get the job done, but is it the most effective way to get the job done? No. Is it going to cause a mess? Yes. Uh, right. You know, is the picture maybe in the future going to fall out of the wall because I didn’t use the right tool?
[00:41:17] Patrick Lonergan: Uh, high likelihood, right? And, and it’s interesting. We, um, we helped a local advisor that wanted to retire, take over his book of business, uh, and we, we found some of these contracts, uh, with universal life policies that were sold in the late seventies, early eighties. When interest rates were double digits, they were promised, Hey, you just have to pay some premiums and you’re going to be, you’re going to be fine for the rest of your life.
[00:41:40] Patrick Lonergan: Look at this illustration. Well, we know what happened to interest rates. They came down for the next 30 years and their cost of insurance went up and they’re coming to us in their seventies going, Hey, I got this notice. Actually, we were proactive. We just looked through the book of business and went, Oh, geez, there’s.
[00:41:53] Patrick Lonergan: There’s some problems here. Let’s, let’s start solving these now, uh, versus waiting until, you know, there’s something in the future. And those conversations are uncomfortable. It is like, Hey, you’re going to have to put money into this, or let’s just surrender it right now. Take whatever cash is left and, you know, just go do something else with it.
[00:42:09] Patrick Lonergan: So, uh, yes, they’re absolutely a problem if they’re not managed well. Right. And, and, uh, they were sort of sold as this, you know. Fantastic tax free interest rate opportunity. And, uh, well, they took the beautiful
[00:42:25] Mark: thing of whole life insurance, which has been around hundreds of years. And then they created something new.
[00:42:29] Mark: I think they took the best part of the whole life, which is the contractual guarantee and the limited flat cost of insurance and replaced it with something that is nightmarishly dangerous. So again, it’s sort of like, uh, it only takes what is, uh, you know, all it takes is one Adam to go from. You know, water to something that could poison you.
[00:42:48] Mark: So be very careful with how it’s designed work with a, and I would just say, if you don’t remember anything else, just find someone who’s certified in this arena, a bank on yourself, professional is. Is absolutely going to track all this to make sure and know all the levers and pulleys of your financial airplane to do this thing, right?
[00:43:07] Patrick Lonergan: I love it. Now, Mark, if it’s okay, can we get into some of the different uses on how we can utilize a policy inside of a business? Yeah, I think there’s some opportunities for. Uh, putting this as an asset on the balance sheet and then protecting against some risks that, that businesses are facing, especially if they’ve got, you know, key people in the business.
[00:43:26] Patrick Lonergan: So can you walk us through a few of those? Well, we’re in the middle of
[00:43:28] Mark: just, uh, releasing a brand new book on this topic. So I will give you the skinny on that, uh, but the book is coming out shortly this spring. There’s it’s yet to be titled. So if you want it, and you’re listening to this months later, go to kickstartwithmark.
[00:43:42] Mark: com and I’ll make sure you get a copy of the book once it’s released. Uh, but to answer your question, there are so many ways. So here’s just a few in brief. I’ll keep this brief. You know, you can have a policy that’s personally owned and you can lend money to your business. Let’s say you just want to lend money every so often for business needs.
[00:44:00] Mark: Great. Do it. You can do that. And then your business can pay you back and it can avoid wage taxes and VICA and that sort of thing. Great idea. And you always have a line of credit to your business, even if. What’s that Mark Twain quote? A banker is a fellow who will lend you his umbrella when the sun shines and once it back, as soon as it starts to rain, well, you’ve always got yourself an umbrella when you’re the one that’s handing it out.
[00:44:23] Mark: Number two, you can have it on the balance sheet of your business as an entity owned policy. So fund it with pre tax dollars. You might say going into the policy. And you can get it in there inside your business and build up an asset that now is, is increasing the value of your business, makes you more lendable to banks.
[00:44:43] Mark: If you still need a mortgage or something, you can also use it as a, again, a line of credit for your business purposes, or there’s a business, it’s an architecture firm, two or three business partners that each bought policies on one another. And they now have a couple of buckets that they can draw on for marketing, expenses, inventory.
[00:45:04] Mark: And if one of them, God forbid, should die, that replaces that, that death benefit replaces that partner and even can buy out the spouse. This is known as an entity owned by cell agreement. And also what’s called a key man or key person policy. Um, one more idea, and then I’d love to get your feedback, Patrick.
[00:45:24] Mark: Um, what if you’ve got a couple of really cool, really snazzy, really sharp employees that you want to retain, or maybe a new one that you want to attract? Well, you’ve, you’ve got your 401k, you’ve got your health benefits. All that’s great, but you really want to sweeten the deal to keep your best sales gal.
[00:45:41] Mark: You could offer him or her a 162A plan. It’s called an executive bonus life insurance policy. It’s where you pay them a little money, you get a tax deduction for it. They put it into a policy and they can use it again. Bank on yourself means they can access that money for their kids braces or pay off their credit cards or send their kid to college or fix up their kitchen.
[00:46:05] Mark: But ultimately they’re preparing for their own retirement, uh, with, you know, again, if it’s designed properly, you can get the tax free money out of that policy in retirement. So. You think that’s going to keep that employee around? You bet. They’re going to work a little harder for you because you can bonus them money when they do a good job, throw a little extra in there, and you’re not subject to all the rules and restrictions that typical 401ks and IRAs through your work have to follow.
[00:46:29] Mark: So those are just a few ideas, and there’s so much more in the book.
[00:46:33] Patrick Lonergan: I love it, and I’m looking forward to the book because I think I think life insurance is an underutilized tool. Uh, I think it’s fantastic for its tax free nature, the liquidity it provides, uh, both while you’re alive and, um, at your passing.
[00:46:48] Patrick Lonergan: And so one thing you mentioned that I’m, I’m generally interested in, I’ve got sort of two questions. The first is if I’m using this as like in a, uh, a key. Employee retention tool, right? Uh, I want to keep some of my key people. Can I put some limitations on that? Like vesting periods or something along those lines, like we’re going to fund it for a number of years and then.
[00:47:11] Patrick Lonergan: Uh, if you stick with us for, let’s say the next five, you’ll, you’ll have access to those dollars or do they get, do they get access to the dollars right away? Yeah, there’s, there’s
[00:47:19] Mark: certain restrictive covenant agreements. You can put onto a one 62, a employee bonus plans like this, where you can write up some of the documentation that says, Hey, you know, you’ve got to be able to pay us this money back, et cetera, et cetera, for the first seven years, just like any other vesting schedule, but it’s not subject to the ERISA.
[00:47:38] Mark: constricted rules. So you can be very creative here. Here’s a one simple example. When you set up these policies, there’s typically a required minimum premium of some sort with an optional additional amount called paid up additions. Many employee or employers will pay the required amount and the employee can kind of do the employee match, if you will, into the paid up additions optional amount.
[00:48:06] Mark: Well, what if you Let them, what if they quit on you? Well, now they’re forced to pay everything themselves. It’s an asset that now they have a bill to pay on that. And that keeps many of your employees from quitting or leaving on you just inherently without any restrictive legal agreements, you know, just the nature that now you’ve got an extra bill to pay.
[00:48:26] Mark: Cause you’ve, you, you quit the job with your boss that keeps people around.
[00:48:31] Patrick Lonergan: Got it. Love it. And then another thing that you mentioned that I’m curious about is you talked about the business putting pre tax dollars into a life insurance policy. Can you expand on that a little bit? Cause I’m, I’m always, I’m always looking for opportunities where I can utilize pre tax dollars to, uh, put things into an appreciating asset versus a depreciating
[00:48:52] Mark: one.
[00:48:52] Mark: Well, good news, bad news. There’s only a few ways you can deduct your premiums. Uh, and when you deduct it on one side, you know that it’s going to be taxed on the other side. And because most life insurance is tax advantaged on the other side, it’s very difficult in most cases to, um, deduct premiums when they go in.
[00:49:12] Mark: That said, you can avoid payroll, FICA, all the other You know, it’s a, it’s an expense to write a premium. So you’re not paying any, you know, uh, self employment tax, et cetera, et cetera. You’re using that business money and you’re getting it in there before you might say any, you know, again, distributions or wages are coming out.
[00:49:32] Mark: So you’re getting that money into the policy in a tax favored way, and it’s in there and it grows tax deferred within your business, your business. If it was in a savings account, would have to pay taxes, not so in the life insurance. I love
[00:49:44] Patrick Lonergan: it. You know, we, we think about life insurance and utilizing it a few different ways.
[00:49:49] Patrick Lonergan: Like there’s, there’s sort of two different strategies that we’ve, we’ve explored that, you know, you, there’s somewhat tax deductible nature for life insurance. One, we’ve seen it inside of a cash balance plan. Uh, now at some point you have to buy it back out of the cash balance plan. So it, uh, uh, you know, there’s still an exchange there that, um, Uh, and, but there’s some really nice economics around that whole thing.
[00:50:11] Patrick Lonergan: And we’re like, wow, this is, this is really cool. And then, uh, there’s a guy that, uh, we’ve worked with. His name is Ken Crabb, who created this structure. It’s been tested by the IRS, uh, with the restricted property trust that, uh, allows the business to deduct the cost of the insurance, the employee has to take some of it as a benefit, so it’s about 70 percent deductible, but there’s a ton of strings attached to it, um, which sort of makes sense, but you know, there’s.
[00:50:37] Patrick Lonergan: Uh, there’s a couple of ways to deduct the life insurance, but, uh, yeah, when you, you mentioned that I’m like, Hey, this is, this is interesting. I’m always looking for, for new opportunities, especially with a tool like life insurance that has, uh, so many advantages the way it is. We can, the Holy grail would be to be able to deduct the premium.
[00:50:52] Patrick Lonergan: And then have tax free growth and death benefited on the backside. Haven’t seen that yet, but, uh, you know, maybe the day will come. That’s right.
[00:51:00] Mark: Yeah. Well, there’s so much, just look up bank owned life insurance or look up corporate owned life insurance, corporations, banks, there’s some of the biggest purchase of.
[00:51:09] Mark: Purchasers of these, what do they know that we need to find out as entrepreneurs?
[00:51:13] Patrick Lonergan: Yeah, absolutely. Yeah. And there’s, you know, some, yeah, this is a conversation for a different day, but split dollar arrangements. There’s so many different ways to put these, uh, these policies together in a way that, uh, inside of the business that.
[00:51:26] Patrick Lonergan: Can provide tremendous value both to the employer and the employee. Um, uh, yeah, this has, this has been wonderful. All right, mark, so let’s say somebody is like, I am all in. Like, tell me more. I want to start my, my bank on myself. Policy is kickstart with mark.com, the place to go that’ll have
[00:51:45] Mark: so many resources on there.
[00:51:46] Mark: Not only will it give you our YouTube channel, our podcast, it’ll give you everything you need to know. It’ll even point you in the direction of my calendar where you can have a 15 minute phone strategy set. And so you’ll see one of them, you’re going to pick this out and you’re going to do a couple of things.
[00:52:14] Mark: You could say, Oh, yeah, I can do that. Uh, but you want to be careful of that. So go to kickstartwithmark. com and, and you can find all of our resources. There are podcasts, uh, such as not your average financial podcast. You can find the links there at kickstartwithmark. com. I love it. I love it.
[00:52:34] Patrick Lonergan: And Mark, you’re so right.
[00:52:35] Patrick Lonergan: Like, um, I’m just thinking about the design in general, you know, like the same entrepreneur could say, you know what, Mark, you know, what’s most important to me, liquidity today. If he changes that answer to, you know, it’s most important to me, Mark tax free retirement income, the design of that policy, possibly the company that that policies, you know, placed with can change based on those answers.
[00:52:58] Patrick Lonergan: So like knowing somebody that knows how to do this, has a track record of doing it, can do the research on your specific situation and what the best. Opportunities are really matters. Please don’t go down the street to your local life insurance, PNC coverage guy that, you know, says they can sell you life insurance and have them try to put something together.
[00:53:19] Patrick Lonergan: Cause it’s, uh, again, it’s going to go back to mine. Yeah, I can get that screw in the wall with a hammer, but it’s not going to be the best outcome. So I love that. Thank you. Thank you, Mark, for being just an expert in this arena. I think it’s a fantastic, I think this conversation matters. I think life insurance is a underutilized tool that.
[00:53:37] Patrick Lonergan: You’ve positioned it correctly. It is a tool. It’s not solving every financial problem. Right. But in certain circumstances, it’s the best solution for the issue that, uh, a lot of our entrepreneurs have, which is, you know, having leveraged liquidity is what I’m going to call it. So Mark, I, I love this. I just think about what success comes from.
[00:53:58] Patrick Lonergan: You know, leveraging this tool, we get, we get to pay less taxes, which is great. We get guarantees, uh, which is an entrepreneur who doesn’t love a guarantee. It protects our family and people we care about. I think that is, is fantastic. And again, you, you also brought up a really important point on just create safety, right?
[00:54:19] Patrick Lonergan: Like we’re, we’re putting these eggs in a different truck, right? Like as entrepreneurs, we can, we can take an additional level of Protection, especially when it doesn’t actually cost us anything. You know, not only does it not cost us anything, it provides some additional benefit. So I, I just thank you for highlighting all of those distinctions for us.
[00:54:39] Patrick Lonergan: Cause I, I think at the end of the day, you know, our, our job is to help our, our entrepreneurs minimize their taxes, master wealth and optimize their lives. And, uh, I think we can, we can see this checking a number of those boxes. So thank you so much for being here today. Anything else that you want to add before we, before we wrap up?
[00:54:56] Mark: Well, I, I, fully agree and appreciate everything you’ve said there. And I won’t say anything more except just guys, give this guy a five star review. He’s got a great podcast or great show. They work really hard on it. So make sure that happens. Do it now before we move to the next episode, a five star review.
[00:55:13] Patrick Lonergan: Wonderful. Thanks so much, Mark. Thank you so much for tuning into today’s episode of the vital wealth strategies podcast. I hope you found real value in this conversation with Mark Willis. And then it gave you new insights into how you can take control of your finances, protect your business, and build long term wealth.
[00:55:30] Patrick Lonergan: If you enjoyed this episode, please share it with someone who could benefit from this information. A fellow entrepreneur, a business partner, or even a friend. It could be exactly what they need to hear. And remember, you’re a vital entrepreneur. You’re vital because you’re the backbone of our economy.
[00:55:43] Patrick Lonergan: Creating opportunities, driving growth, and making an impact. You’re vital to your family, creating abundance in every aspect of life. You’re vital to me because you’re committed to growing your wealth, leading with purpose, and creating something truly great. Thank you for being a part of this incredible community of vital entrepreneurs.
[00:55:59] Patrick Lonergan: I appreciate you and I look forward to having you back here next week on the Vital Wealth Strategies podcast, where we help entrepreneurs minimize their taxes, master wealth, and optimize their lives. Until then, take care and keep building something great.