Bank on Yourself: The Life-Changing Secret to Protecting Your Financial Future

I first discovered this concept seven years ago when reading Nelson Nash's book,BECOMING YOUR OWN BANKER. Mr Nash approached the subject from a business point of view. Pamela Yellen has shared similar ideas from a personal and relational view. Together, they provide an excellent and compelling picture. It shows a fundamental approach nearly any normal, intelligent person can follow to establish his finances on a solid basis. Having money stored safely where it is productive and available whenever needed creates all kinds of exciting possiblities. Not the least of these is the ability to respond to emergrncies and fully utilize oppoerunities as they appear. I initially opened three accounts to test the theory and found them so efficient it became necessary to open up two more several years later to hold the overflow I had not expected to occur. From my new position of strength and with my family protected by the substantial death benefits, I was able to invest with confidence. The results have been gratifying. What a wonderful feeling to have a place to store my profits in safety. I have come to also appreciate the ability to make returns in both my bank on yourself account and also in my investments at the same time. I find this amusing. A few negative comments about Pamela's book indicate this is an old, proven idea. So much the better! Would we want to jump into some scheme that is unproven or even possibly unworkable? And thank God that Pamela,s book is so compelling. How else would people catch her vision and turn their financial affairs around so effectively? It is apparent that the same financial resources are available to all Americans. Ninety five percent of Americans are struggling financially. I am convinced that they tend to use resources like banks and credit cards in much the same ways. Five percent of Americans are financially successful. Don't you suppose they use the same resources more wisely? The bank on yourself concept and the resources involved are a far cry from the turmoil in our failing banking system and an oppressive slavery to debt which is so common today. I say, "Why reject such a fine resource. Go for the gold."

Others may say this is hype and an infomercial but in reality it is a different way of looking at how money works. You have to get over the fact that this is a whole life insurance policy. When you really look at whole life insurance without its name (one of my good friends sales used cars that doesn't make him a bad person) it is not so bad. The book points out we finance everything either we pay interest to others or we give up interest on our money to an institution (ie banks). I have done this with an advisor and know others who have as well and there are no complaints (try surveying people that have been in the market for the last ten years and see if they ALL are happy with thier decision). The key here is that your money is always working for you and how the insurance company treats your loan seperate from your account. -So if your cash value = $50,000 and you took out a $20,000 loan for a car the company still gives you dividends on the $50,000 and charges your loan the going interest rate. -So first off you are being credited interest on $50,000 instead of $30,000 like a bank. -Lets say the bank is paying net (after taxes) a rate of 3% and the insurance company (insurance companies costs are lower since they don't have braches/ATMs on every corner of your city) is paying 5% and your loan rate is 7% -In the bank you only receive interest on the $30,000 or $900 -In your insurance policy you receive $2,500 ($50,000 at 5%) - $1,400 ($20,000) or $1,100 or 22% More -In the next year (say you paid off 20% of your loan or put back $4,000 in your savings account) -At the bank you receive 3% on $34,900 or $1,047 -In your insurance policy you receive $2,625 ($52,500 at 5%) - $1,120 or $1,505 or 44% more! This does not work with mutual funds because they are too volatile (we never really know what we are going to have in the future), we don't know how we will be taxed, and we have to sell assets to get to our money. This does not work with 401k/qualified plans because we have to wait until age 60 for no penalty (if the govt doesn't change the rules), most 401ks are full of mutual funds, we again don't know our tax rate, and again you have to sell off your assets There probably are two reason people get hung up on this topic: one being that it is a whole life policy and the other is rate of return argument. People forget it is not about rate of return but rather money in your pocket. I'd rather have 2% of $100,000 than 10% of $10,000.

Pamela Yellen's book creates a compelling case for accumulating substantial money that remains in your control, in a tax favored entity, you can access at will and re-use as you re-fill. I am a believer in permanent life insurance and have had other cash value policies for many years. When I learned of this, I transferred those values into my first and second Bank on Yourself policies. Why? Because it grows faster, it offers guarantees and dividends my other policies didn't. I think Pamela's writing style is approachable and provides a pretty quick read. The stories of people from all walks of life and how they have used their BOY plans stimulated my imagination. It does seem this BOY idea would be well worth considering by many people. Open your mind, set aside your investment bias (I had to) and natural resistance to life insurance conversations and see what you think.

I have met Pamela several times in the past, and I know that she walks the talk that she reveals in this book. The basic premise is that you can structure your financial affairs without pain such that you are paying yourself tax-free interest on many of your large purchases. For people who are able to muster up the appropriate discipline, this is a great strategy. The book does a good job explaining the plan, although the buildup is a bit longer than it needs to be. Great read and worth your time.

I ordered a copy of Pamela's book three weeks ago and had a hard time putting it down. Many of the problems she outlines in her book have been personally experienced by me over my adult life. I am now 58 years old. About 7 years ago it became clear to me that the traditional way of handling my savings and investments was not working. The method that Pamela offers is one that I know works. My wife and I started our first Bank On Yourself plan 6 years ago and now own 4 plans. Bank On Yourself will put you in a much better position than you would have been without this information. For example, since I got my driver's license I have purchased 12 cars for a total spent of $150,000. I paid cash for some and financed all but one of the others. When I started to figure out how much interest I either lost or paid out on car loans it literally made my sick. I would have been happy if I had recaptured just the purchase price on these cars instead of the $0 that I now have to show for the cars. That money would be very usefull right now. The good news is that I will never ever have to finance another car outside of my Bank On Yourself plans. This is really great because cars today cost much more than they did years ago, so I can recapture a lot of money going forward. I urge you to take a look at this book and make a very inexpensive and extrememly worthwhile investment in your future. Alan Eckstrand