For many of us, the Stock Market has been presented to us as the premiere method for attaining wealth for wealth building and retirement. However, with the uncertainty attached to the markets, lack of control, and volatility in the world economies, many of us are searching for alternative ways to work with our money.
Unless you have a mind akin to Warren Buffet, you probably won’t be one to amass a fortune in the Stock Market. It can seem like there’s a veil in front of the Wall St. world for the average investor. No matter the way you feel about Wall Street, it is nice to know that there are other ways to make money, perhaps ways that help you keep better control of your money while providing greater growth opportunity.
Let’s take a moment to look at some alternative options you have available to have your money work for you:
- Real Estate
The world of Real Estate investing offers some very unique advantages that can be utilized regardless of whether the stock market is up or down. Not only is there the potential for appreciation of asset value when the housing market goes up, but many have found great success creating a cash flow empire in Real Estate through rental properties and apartment complexes.
The power lies in your ability to leverage borrowed money when investing in real estate. We forget that real estate operate slightly differently than other investments. Although you only may have put 20% down to buy a property, you get the benefit of the full investment when you look at return when you sell that property in 5 or 10 years.
Then, you get into the tax advantages. Often, you can deduct your entire mortgage interest from your taxable income. Depreciation deduction allows you to deduct on the part of your property used for rental purposes, keeping down your reportable net income and reducing your taxes. Reverse Mortgages and Cash-Out Refinancing options to put cash back in your pocket without losing the properties themselves.
With all these options, there is one absolute necessity: EDUCATION. Real Estate can be extremely lucrative, but the best investors are those that spend the time educating themselves, as any business owner educates themselves in their field. Conveniently, we live in an era of great accessibility to information and educational materials – books, audiobooks, blogs, podcasts – the tools are out there.
- Dividend-Paying Whole Life Insurance
401k programs and IRA’s had a virtual “takeover” of the retirement marketplace in the 1980’s. Because of it, society lost its interest in the whole life insurance policies of previous generations. More recently, however, these policies are slowly coming back and gaining steam in the marketplace as benefits are rediscovered. Whole life insurance, like real estate, has some incredible advantages when compared to other tools for wealth building.
- Cash Value inside a policy grows tax-deferred, and can be accessed tax-free at any time through a policy loan. Taxes represent one of the greatest threats to wealthbuilding. Because of it, accessing money on a tax – free basis (without penalties) is incredibly valuable.
- Whole Life Insurance policies are guaranteed to grow. When using a Mutual Life Insurance Company, your policy is eligible for additional growth through dividends.
- The policy loan feature allows policyholders to leverage the cash value of the policy. This is similar to how the Real Estate investors can access the equity of their properties without having to sell the asset. This allows your policies to continue to grow as if no money was taken out.
The death benefit payout then passes income tax-free to your heirs. When thinking on the scale of building intergenerational wealth, that’s an incredible advantage.
- Private Family Financing
Private Family Financing, our implementation process for Infinite Banking, is an innovative way to use the advantages of Whole Life Insurance to enter the “financing” business.
The goal of Private Family Financing is to use your policies to take over all of your car loans, mortgages, student loans, business loans, credit card debt, etc. Once these debts have been paid off, we can now take all of the payments that used to be leaving your hands and send them back to your policies! You are essentially making all the money that the banks and finance companies were making off you, and it’s all done on a tax-free basis! You’ve essentially “invested” in debt, and turned your liabilities into assets.
However, why only focus on your own debts? Many of us have children, parents, siblings, and grandchildren, who all have mortgages, car loans, credit card debt with other banks. By keeping all this money within the family, the opportunity arises to create a large financing enterprise.
There’s this misconception that the stock market is where you go to make money. Films like “The Wolf of Wall Street” portray the stock market man who is out of his mind with money and assets. However, that doesn’t portray a reality for the majority of investors. There are simply better, smarter options for some people. Exploring those options and educating yourself on how you might leverage them is always the best first step.
