I'm going to address why does a max funded IUL pass the safety test
for money better than banks and credit unions. Get ready, by the end of this episode, you will
understand why legal reserve insurance companies are the backbone of America.
So, I'm Doug Andrew I've been a financial strategist for north of 48 years helping people
optimize their financial assets and also other assets on the family balance sheet. We talk about
those on this channel. These are the intellectual and foundational assets that all of us possess.
But this episode is talking about
money and so when people have come to me for nearly five decades
they want to be able to set aside their money in a safe environment. Where hopefully they
will not lose principle and they want it in safe institutions. When we talk about safety
there's actually two different definitions. One is the safety of the institution. A lot of people
think that money in a bank or a credit union is one of the safest places to deposit money. Why?
Because it has that FDIC insurance on it. Did you notice? It's insurance
that makes it safe but who's the insurance a company operated by at a bank? Federal deposit
insurance the government. People sort of go, "Well, the government
they can always sort of print more money or taxes", yep and so people get sort of
lured into a sense of I think false security thinking,
"Oh, the government is protecting this so the safest place is to have my money in a bank". Well,
let's talk about the second definition of safety and that means safety of principle
or safety of keeping up with the purchasing power of the dollar because of inflation.
Because when the government prints and prints
more money that causes inflation and you didn't really
have safety of your principal or if your money is invested in the market and the market goes through
its gyrations, you can lose your principle. A lot of people don't think about this. So, I like
to use both definitions. I want the safety of the institution.
I want to put my money where the banks
put their money for liquidity and safety. But I also want to have safety of principle which means
I don't want to lose money that I invest into the investment or the instrument financially.
I want to protect my principle but any year that I make money I want that money that profit
to become newly protected principal. Meaning, I don't want to ever lose in future years
money I've made in previous years. Most financial advisors don't know how to do that. They just say,
"Oh, just hang on. You know, when it goes down it'll come back up again. Hang on the market
always comes back", and so what happened in 2001, 2002, 2003, many Americans lost 40%
on their retirement nest eggs. They maybe had a million bucks in the year 2000 it
was only worth 600,000 by the end of 2003. It took four years to make back what they lost.
They were just back to break even again. Now, people using my favorite vehicle they had safety
of principle it's what I call a Laser Fund liquid asset safely earning return spells and acronym
laser and so they did not lose their million. They may not have made very much in 2001 to 2003 but
they didn't lose. They were protected from loss and then in 2000, 4, 5, 6, 7, they were able
to make money at the end of 2007, their million was worth as much as 2 million when most people
were barely back to break even. Because they did not lose when the market went down they had safety
principle and then they made money and so they had 2 million then what happened in 2008? The
market dropped 40% again. People's million-dollar nest egg that they finally got back to break even
went down to 600,000 again for the second time in a decade. The people using my favorite vehicle
The Laser Fund their 2 million just stayed there at 2 million in 2008 they didn't lose what they
had made the previous four years and in 2009 they started making money again and instead of waiting
four years to get back to break even which most Americans, it took till 2012 for their 600,000 to
come back to a million again to break even. That's why we call it the great recession or or the lost
decade it was actually 12 years. Many people ended up with tripling their money in that time period
because they did not lose when the market went down. They may not have made very much but they
didn't lose and they started making money again. This is called indexing. This is how you have
safety of principle. So, let's talk about what this means historically. But before I go there,
if this is intriguing you post a comment, click like, share it with somebody who you think would
benefit from this video. But I would love for you to subscribe, it's easy. Click on
subscribe it's free and click the little bell when you do so. You'll be notified every time
I post a new episode which I do almost on a daily basis. But stay with me to the end,
I want to gift you a copy of my 300 page book The Laser Fund absolutely free. I'll pay for the book.
So, folks, during the great depression we had banks close, real estate dropped
80%and there were 40% of banks that never reopened again. There was not one single legal
reserve insurance company that went under in the great depression. Money was safe in those. Maybe
you only earned two and a half or three percent but
when things go really bad people get more concerned about the return of their money instead
of the return on their money. In 2008 we had 400 banks go under in that you know mortgage meltdown.
900 more were on the brink of going under it was called the watch list and how many legal
reserve insurance companies went under in 2008? Zero. In fact, the federal government asked the
five major banks to disclose where they have their tier-one assets for liquidity and safety and the
bank said, "Well, in insurance companies", because insurance companies are usually rated six notches
higher in safety than most banks are rated. A lot of banks are only rated maybe triple
B by standard poorest. A lot of this insurance companies are rated double a or aaa you may not
know but that's like six notches higher in safety. Do you know what the banks are doing? In 2008 they
were going well. Yeah, we are taking the public's money and people deposit money in a bank
and the banks were paying one percent let's say not even that high and they're turning
around and increasing the safety by about five or six notches higher in safety by putting some
of your money into insurance companies and they are increasing the rate of return because they're
earning more like five percent. Five percent is how much more than one percent don't say four.
They're paying you ten thousand dollars of interest on a million dollars in their bank
and they're turning around making fifty thousand. Fifty thousand is five hundred
percent or five times ten thousand. This is how money works but they're increasing the safety.
You can bypass the middleman and put your money straight into the insurance company
and use what banks do. They have bank-owned life insurance that's called BOLI
bank-owned life insurance that's an acronym. Who do they own it on? It doesn't matter stockholders
board of director members or whatever. It's the
owner of the insurance policy that gets all the tax-free accumulation and so forth.
Remember that, there's other episodes on this channel that'll help you understand this concept.
The point is this, legal reserve insurance companies are the
backbone of America and the backbone of the world
and that's where many of these other financial institutions put their money.
That's where many governments go to for help when they get into trouble. When banks and
credit unions put 30 to 40 percent of their tier one assets into insurance companies for liquidity
and to increase the safety we ought to be thinking, "Hmm...
why don't I take advantage of that? Why don't
I bypass the middle man?", well, you can and so the point is most insurance companies are rated
five six notches higher in safety than most banks. So, why would you feel better about having your
money in a bank down the street because it has a drive up window and you think that's liquidity
when really that's just convenience. Why would you have your money in a bank or credit union
thinking that's the safest way because if FDIC. What does FDIC mean? Federal Deposit Insurance.
Why rely on the government's insurance company that sometimes has almost been on the brink of
going broke when they bailed out you know the savings and loans industry or in 2008
because you want to go straight to where they put their money and so that's what I'm talking about.
Serious cash whether it's emergency funds, retirement planning, working capital for business.
I put all of that into IUL indexed universal life.
I maximum fund it. I'm earning great rates of return
netting me 8, 9, 10, percent tax-free. But it's liquid and it's safe. As far as I'm concerned
it's the last domino that would fall if we had a total financial collapse in America and you
would have so much warning from all of these other institutions going under that you could grab your
money but let me ask you something. Where would you put it? If it's that bad the American dollar
would be worthless. You better be able to grow carrots in your backyard even
owning gold and silver won't help you in that situation because you can't eat the gold and
silver. If this is making sense I want you to learn and read why I feel like The Laser Fund
is the best place to put money serious cash for liquidity safety predictable rates of
return tax-free and it would be the last domino to fall if we had a total collapse of all the
financial institutions in America. Does that make sense? If you want to learn more I would recommend
you read this book it's been flying off of our warehouse shelves it's called The Laser Fund and
this will teach you how to diversify and create the foundation for a tax-free retirement. But
how to pass the liquidity safety rate of return test
with flying colors and have it be tax-free to boot.
That's what these four pillars are. These are
the key elements of a prudent investment. As far as I'm concerned being a financial
strategist nothing comes close to passing the safety test better
than a max funded indexed insurance contract where you're safe from market loss. You take
advantage when the market goes up you don't lose when the market goes down because your
money is not at risk in the market. You have safety of the institution.
You have safety of your principal. this is crucial for you so that you will not outlive your money.
So, go to laserfund.com click on the link below. You contribute a
nominal amount towards the shipping and handling
have some skin in the game and I'll cover the rest of that and I'll pay for the book.
I'll fire out a copy to you this is 300 pages. It's actually divided up into two books. This one
is for the left brain learner all the charts and graphs and explanations. If you learn
more by stories you flip it over and read this one and this has
12 chapters with all kinds of stories and examples of how savvy people use the laser
fund for all kinds of financial goals. It's the dream solution for an emergency fund,
retirement planning, working capital for your business, real estate management,
on and on and on. So, claim your free copy now this is the beginning of your better safer future.