FREE Kindle Book: Busting the Life Insurance Lies

[DHK]

Uh... no. That's not even remotely hinted in this book.

 

[Cenla Agent]

It's $3.99 now. Too bad I missed this earlier, but that's still very low if it is as good as DHK says it is.

 

[jcorr]

If you subscribe to Kindle Unlimited you can still read it for free.

 

[adjusterjack]

Just got mine for $1.99

 

[Lloyds of Lubbock]

I know Kim very well and always enjoy her perspectives.
Check out her partners for prosperity website.
You can subscibe to weekly webex' for free.

 

[jcorr]

I actually sent Kim an email about it (she hasn't responded). I like explanations that can be proven mathematically, not just in an explanation.

So, here's what I sent:

I’m reading through your book today, and I’m really liking it! However, I do notice a few things that I wanted to bring up to you:

Lie #2 - Life insurance loans – when loan interest (arrears and current interest) is repaid back to the policy, it restores the earnings back to the policy – regardless of direct or non-direct recognition.
- $100,000 @ 5% = $5,000
- $50,000 loan @ 5% interest = $2,500 loan interest cost (I’m ignoring 1st year interest in arrears in this example as that’s the initial loan charge).
- If you don’t pay the interest out of pocket, $5,000 - $2,500 = $2,500 net earnings.
- If you pay the loan interest back to the policy, it restores the earnings: $5,000 - $2,500 + $2,500 = $5,000.
o I’ve done this illustration with a “direct recognition” company and found that if the interest only was paid each year, that the interest + a slight gain was credited to the policy.

Plus, while you don’t “have” to pay the annual interest, it’s a lower payment than financing something requiring principal + interest payments. If you financed that $50,000 with a 0% loan for 5 years, that’s $10,000 per year, instead of the $2500 per year + 1st year interest in arrears. It’s not just about the interest rate, but about the total cash flow. Yes, they should pay the $10,000+ to their policy each year, so they can collateralize against it again, but knowing the minimum options are helpful as well – just to keep the policy afloat and healthy.
- In addition, the loan itself is not reported to credit bureaus, helping credit scores and “hiding debt” legally. This can help preserve credit scores in the event of a lengthy period of unemployment.

Lie – Insurance companies keep your cash value:
- At any given point, the formula is this: net death benefit = ‘net amount at risk’ + cash values – any outstanding loans. The cash values are a component of the net death benefit paid out. The problem is most people talk about “face amount”, but “face amount” is simply the beginning of the benefits calculation for the illustration, not the end or final result.

Lie #35 – I think your math is incorrect in this section. When you calculated the interest, I think you added annual interest and forgot to divide by 12 for the monthly amounts that would be added on a ‘per diem’ basis.

I know it's been a couple of years but did Kim ever get back to you on your questions?

 

[DHK]

She did - but she just acknowledged my questions, but no commitment to changing anything, if I remember it correctly.

 

[DHK]

It was also part of the reason why I created my own blog and did more 'quantifying' of the values and strategies that still seemed nebulous as explained in Kim Butler's book.