The Safest Place on the Planet for your Money.
Today we are going to look at risk on our cash with the recent SVB bank closure.
Remember The AIS Triangle? #1 Asset, #1 Investment and #1 Strategy.
The #1 Strategy with cash that you are going to relinquish control of outside of you and your career/business is to keep it GUARANTEED, PROTECTED AND LIQUID.
Guaranteed and protected to protect our mindset to ensure the conditions around us to produce at the highest levels in our area of expertise. Your career/business.
Nothing will outperform your ability to create and exchange at the highest levels in your area of expertise.
Cash in a whole life policy as The Solution.
The oldest companies in America. The oldest Mutual life insurance company in America is over 180 years old.
These companies are rare. No one has formed one in a very long time.
Demand for their products never changes.
Even in a Great Depression or an economic boom. This industry doesn’t have a business cycle.
Statistics drive profits. Actuarial science. The law of large numbers. Pooling of risk.
These companies do not trade of the stock market. Their values don’t fluctuate like traded stocks.
Because there are no shareholders, Wall Street, analysts, and money managers cannot pressure them to make short term decisions. Their managements are free to pursue long-term strategies. As a result, these corporations are known to be among the most conservatively managed companies in the world.
They generate tons of cash, and they pay large dividends to their owners every year.
They don’t use debt.
Life insurance is one of the oldest financial products in existence. The sale of life insurance in the US began in the late 1760s. Life insurance has proven itself through two World Wars, a Revolution, a Civil War, the Great Depression, and numerous other recessions.
Did you know there hasn’t been a single life insurance contract default in the last 300 years in America?
Can you think of any other product that has proved itself like this? Popular investment products today include mutual funds, EFT’s, 401(k)s, and IRAs. None of these products have been around for more than a few decades.
Life insurance is a recession-proof business. People need it, regardless of what’s going on in the economy.
Let’s dig a little deeper. A person’s death is certain. Life expectancy is predictable for large groups. There’s plenty of data and the insurance company knows what the payout of death claims will be. Insurance companies hire data crunching experts, called actuaries. Actuaries study this data. Then they create life insurance policies for the insurance company’s customers.
Here’s a little more data for you: during the Great Depression, more than 9,000 banks went bankrupt. According to the hearing of the Temporary National Economic committee in 1940, only 2% of the total assets of all life insurance companies in the US became impaired between 1929 and 1938.
Because the life insurance industry was so strong, it played a big part in keeping the country afloat and helping many troubled businesses get back on their feet.
The same pattern appeared after the stock market crash of 2008 to 2009. We examined several of the safest insurance companies and found that less than one percent of their investments were “non-performing.”
Let’s be clear, the life insurance companies that I am talking about our mutual life insurance companies. Stock life insurance companies are life insurance companies that are traded on the stock market.
Mutual life, insurance companies serve only one master, the policyholder. There are no outside shareholders to split profits with. So, safety and stability are the only goals of the insurance company. Mutual insurance companies still generate profits for their owners. It’s just that the profits aren’t the primary motivation.
Who are the owners? You and I as policy holders.
Mutual insurance companies are more likely to focus on safety that on growth, they’ll keep large cash reserves.
You’ve heard me say this, banks are highly leveraged. By law they only have to keep $.06-$.07 of the dollar in reserves, mutual life insurance companies keep dollar for dollar in reserves.
Invest in yourself. People.
INVEST in your career. Your own business that you control. That you have knowledge and expertise in.
SAVE money in dividend paying whole life insurance structured the most efficient way with Mutual Life Insurance companies.
The Safest place on the planet for your cash. Click to read more and listen to my article on this.