TSP Directory Mention of the Week: Dynasty Wealth

Dynasty Wealth Partners

Dynasty Wealth Partners

Our TSP Business Directory featured mention of the week is Dynasty Wealth Partners. They are an authorized Infinite Banking Practitioner. Dynasty Wealth can help create multi-generational wealth. Their strategies show you how to keep more of your money, have more control over your finances, pay less taxes and build more wealth for now and for the future.

Dynasty Wealth has three websites to advise you on specific needs. They are Dynasty Banking, College Savings Plus and Business without Banks. Each of these areas of expertise will appeal to those that are interested in learning more about those topics. They have an excellent blog that features posts to enlighten you to wealth preservation and debt elimination.

A licensed IBC provider

The Definition of Banking

Michael has a wealth or resources on his site about the Infinite Banking Concept, if you are interested in learning more. You can check out his blog here, but I wanted to share a particularly interesting section from his site:

“Banking, banks, savings and loans, credit union etc. Do the commercial banks own these words? Think about the word – Bank. What does that mean? You see we have blood banks, memory banks, snow banks etc. A bank can also mean a slope that goes to a body of water, like a river bank.

Commercial bankers do not own the word bank. What we would like for you to understand today that banking is a function. Banking in the sense of money is an action where someone deposits money into a pool, that which can then be loaned out to generate revenue.

In modern times customers of a bank or credit union deposit their money (which is actually a liability on the banks balance sheet). Then through the use of fractional reserve lending the bank can create loans based off of the allowable fraction determined by the central bank. This is approximately around 3% of deposits to the commercial bank.

Reserve requirements are the amount of funds that a depository institution must hold in reserve against specified deposit liabilities. Within limits specified by law, the Board of Governors has sole authority over changes in reserve requirements. Depository institutions must hold reserves in the form of vault cash or deposits with Federal Reserve Banks. (source: www.federalreserve.gov/monetarypolicy/reservereq.htm )

In the United States, a reserve requirement(or liquidity ratio) is a minimum value, set by the Board of Governors of the Federal Reserve System, of the ratio of required reserves to some category of deposits held at depository institutions (e.g., commercial bank including US branch of a foreign bank, savings and loan association, savings bank, credit union). The only deposit categories currently subject to reserve requirements are net transactions accounts, mainly checking accounts. (source: Wikipedia )

Your deposits into your current bank account go on to become loans for your friends, neighbors, and even yourself. Most people think that banks earn the difference of what they pay you in interest and what they charge in interest on loans. This is only partially true. Because of the fractional reserve system banks can earn hundreds of percent based off one deposit.

I explained all this so that you will know that banking is a function and not a place downtown with a large nice building where people in suits go to work everyday called a Bank.

Once you understand the Banking function you can then go on to learn how you can take advantage of “Becoming Your Own Banker”. Meaning, you create a pool of money that builds over time, then when you need access to money you can get said money. When created properly you will have more control, you will be able to capture the interest that is normally going to the commercial banks as profits which in turns gives you even more money in the future.”

Thanks to Dynasty Wealth and all the TSP Directory Businesses

Be sure to check out Dynasty Wealth Partners and the other outstanding businesses right here in the TSP community. Remember to support small business when you can. Shop local and shop within our online community here at TSP. Next week, I will be writing on Fluid Depiction LLC. They are an IT contract and Web Development company right out of the TSP audience. Be sure to check it out.

If you haven’t already listed your business here on the TSP site, you can get started today for less than $1 a month. Build resiliency into your life by becoming your own boss. As we approach the end of 2016, think about opportunities around you, and seriously consider the entrepreneurial path. The only thing stopping you is yourself!

7 Responses to TSP Directory Mention of the Week: Dynasty Wealth

  1. Thanks for the mention this week. We enjoy being part of the TSP community and connecting with other like minded people. We’ve made a lot of great connections and look forward to meeting more TSP’rs in the future.

  2. Infinite banking is just another way to sell whole/permanent life insurance; a product that is inappropriate for 99.9% of the population. For most of us normal people (not the uber wealthy), term life insurance is FAR better.

    • Joe,

      Is this your opinion or are you an expert in finance or is this just something you have heard from the financial entertainers on radio and TV?

      If this is your opinion what do you have to base it on? Like you I believed the exact same mantra touted by the likes of Dave Ramsey and Suzie Orman, I was ignorant of the facts of how it works exactly.

      I learned about Infinite Banking from someone who has been using this for over 20 years and we implemented Infinite Banking into our personal lives. If he would have told us he was selling whole life I would have run away as fast as possible. But the approach of efficiently using our money and compounding it tax free over long periods of time is what attracted us. We saw the power of it and decided to become licensed with the Infinite Banking Institute.

      “Your need for finance over your lifetime is much greater for your need for life insurance” ~R Nelson Nash

      I would be perfectly happy to answer your questions or dispel any myths that seem to be out there concerning properly structured high cash value dividend paying whole life insurance. After all, the companies that we work with have been around for over 100 years and have paid a dividend every single year including through both world wars, the great depression and the great recession.

      I don’t know about you but a tax free dividend of 4-6% beats and bank savings, CD, money market, or bond fund available today.

      Lastly any free market, libertarian, anarchist minded person that would like to free themselves from the Federal Reserve and the Fractional Reserve Banking system would do themselves a favor by understanding how utilizing the concept can individually secede themselves from that horrible system as spelled out in the book “How Privatized Banking Really Works” – Integrating Austrian Economics with the Infinite Banking Concept: L. Carlos Lara, Robert P. Murphy PhD economist.

      I don’t hold it against anyone who doesn’t understand how it works. I was in the exact place 10 years ago until I became open minded enough to begin learning, studying, implementing IBC to fully understood it.

      Feel free to give me a call 931-546-9338

  3. While I do appreciate other peoples views, but websites that don’t portray an accurate picture of properly structured Infinite Banking.

    “where the loan compounds at 6% but the cash value (as collateral) compounds at 4% as well – even with no payments on the loan, it would actually take 27 years for the original $20,000 of equity in the policy to be eroded down to $0, causing the policy to lapse!”

    – Currently my policies have a loan rate of 4.5-5% and my credited dividend (non guaranteed) is 5.75-6% depending on which carrier.

    – Secondly, the person assume you are not making an annual premiums, in which adding additional premium further compounds to the positive side and increasing overall value of the asset.

    – Then the article switches to “In fact, the concerns about “excessive” and overstated return assumptions in equity-indexed UL policies (and the unrealistically favorable loan projections that result) has become so problematic, ”

    Using anything other than properly designed, max cash funded whole life from solid dividend paying mutual companies is NOT recommended for Infinite Banking.

    True cost of paying cash:
    https://youtu.be/lp1BZcex6ds

    Heck even the first comment on that page refutes what the article says:

    “Most agents do sell the sizzle by saying that you’re borrowing “FROM” your policy and paying “YOURSELF” back with interest, which is absolutely not true. It only appears to have that effect as you are indeed taking a personal loan from the insurance company while allowing another asset (your cash value) to compound in your favor.

    The uninformed masses will say it can’t work because of the outrageous commissions life insurance agents receive. If they were educated on the strategy they would know that a policy designed for “banking” is funded to the MEC limits and often includes a term rider, both of which substantially reduce commissions. This allows the policy holder to achieve robust and early tax-deferred compounding of an asset class that has contractual parameters keeping it immune from market risk whether you’re talking Whole Life or Indexed Universal Life. It’s also worth mentioning that quite a few companies these days offer “over-loan protection riders” that function somewhat like a non-forfeiture option after significant policy loans have been taken. If the rider is successfully triggered then some nominal amount of death benefit would be set aside by the carrier, no more loans/withdrawals allowed, and the delivery of a death check would nullify the embedded tax liability for lifetime distributions exceeding basis. They did this because of all the bad press they got from the retroactive tax you described when policies lapse long after loans have been taken.

    Enough about the product, let’s address strategy. Both the books you referenced actually recommend that policyholders service the loans regularly. What you illustrated by not paying the loan for decades proves policyholders have enough time and flexibility to right the ship if they can’t immediately service the loan for some reason as they have been advised to. There’s other things they can do as well like reduce face amount or surrender cash value to satisfy the loan to name a couple. The strategy actually works best for people who intend to be fiscally conservative or “an honest banker” and pay the loans back as soon as possible.

    Even if you were to just pay cash for everything, once you make a purchase, you still make regular payments to fill up your cash account so you can make your next purchase using cash. The “banking” strategy simply has you funnel those cash flows through a very lean permanent life insurance policy to produce a better long term result. In most cases a “banker” will outperform the “cash-payor” for 3 reasons, with the third being the most powerful:
    1. A better risk-off rate of return
    2. Tax-deferred growth
    3. Continuous compounding of the asset.

    You see, every time you pay back the loan the policy brings you to higher place in line on that compounding curve. On the other hand, even if you could get a higher after tax rate of return on your cash account, once you spend the asset to make a purchase, you killed the compounding. You then have to replenish the account with whatever periodic payments and only earn incremental early compounding as you refill your account. In most circumstances, a properly designed “banking” policy will destroy paying cash over time for purchases even if you had a savings account where the interest rate didn’t start with a dot.

    I like the approach of this article how it attempted to be unbiased and objective. Now some people (including many investment advisors) have a strong bias against life insurance. I fault both the investment and insurance industries for that. They have both been bashing each other for ages since they’re often competing for the same dollars, and neither have done a good job of educating the public of how products from each realm can actually compliment each other. The very best advisors take the opinion out of it and learn the merits of how various products and strategies can actually be interwoven to achieve the results that clients want. Do you know any who want a better rate of return on their risk-off assets? Anyone worried about future higher taxes? What if they could harness the power of compounding from not only their investments, but also some compounding from their purchases as well? It doesn’t mean they get to keep it all, but what if they could benefit from a bigger number compounding?

    So if you’re out there just parroting the talking heads that blindly bash life insurance, maybe it’s worth spending time to actually get educated. Any number of IMOs or FMOs would be happy to help. This strategy is not competing with stocks. It is however competing with cash and other fixed income products. If the life insurance products are structured properly by a knowledgeable and ethical agent, and the client understands how to utilize the strategy as an “honest banker,” being as fiscally responsible as they would be if they paid cash for everything, then the “banking” strategy actually can actually work quite well in most cases.

    Is Infinite Banking the Utopia of all financial tools? No, but when used properly, (like paying your loan back, just like you would with a bank loan) you will save money on taxes, interest and have an ever increasing asset that will go to your future generations.

  4. I’ve been reading and studying about Infinite Banking for several years, and while I have only scratched the surface, I believe it to be a viable vehicle for financial security, especially if started early in life. Michael & his associates have helped me to understand the concepts involved. I only wish I had been introduced to this 20 years ago!

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