Personal Finance Blog for Retirement and Investment Advice

President Reagan’s Secret 702(j) Retirement Plan – What it Is and How it Works

The Palm Beach Letter is at it again! And that’s why we’ve been getting questions about “President Reagan’s Secret 702(j) Retirement Plan,” and how it compares to Bank On Yourself.

The 702(j) account has gone by other names, including the 770 Account, President’s Secret Account, Invisible Account and Income for Life.

First let me reveal exactly what the 702(j) Retirement Plan is, and then I’ll tell you what they got right… and what they got wrong.

The 702(j) Retirement Plan is yet another name that the Palm Beach Group gave to the Bank On Yourself method, which relies on a super-charged variation of an asset that’s never had a losing year in it’s 160+ year history.

Palm Beach is the latest group to jump on the Bank On Yourself bandwagon. (We’ve been educating the public about it since 2002.)

And the reason Palm Beach Letter keeps changing the name of this strategy is to create mystery.

You see, Palm Beach Letter is part of a highly successful publishing company that puts out subscription-based investment newsletters.

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“Subscription-based” is code word for the only thing you get for free is hype and mystery. To get any real details or actual meat, you gotta pay for it. Some of their publications and advisory services cost up to $5,000 each, so getting you hooked on paying for their information is a top priority for Palm Beach Letter.

And since you can get all the details you’d ever need to know for FREE right here on this Bank On Yourself website and in our ezine, Palm Beach Letter needs to make sure you never connect the dots.

Start by downloading our FREE Report, 5 Simple Steps to Bypass Wall Street, Fire Your Banker, and Take Control of Your Financial Future, right here. It reveals all the details about the 702(j) Retirement Plan that Palm Beach Letter makes you pay for.

Palm Beach Letter can afford to spend BIG money on top copywriters and massive marketing campaigns. But at some point, an advertising campaign goes stale.

And that’s when Palm Beach Letter hires another copywriter and tells them to dream up a new, mysterious-sounding name for this strategy.

And That’s How the 702(j) Retirement Plan Was Born

I wrote about an earlier name Palm Beach Letter gave to this strategy – the 770 Account. And in that post, I explain three critical things Palm Beach got wrong about it, and one thing they got right.

Some of what Palm Beach Letter got wrong is SO serious that it will undoubtedly cause the various state insurance departments and commissioners to knock on Palm Beach Group’s door, if they haven’t already. One example is that this strategy relies on specially-designed dividend-paying whole life insurance policies, and in most states it’s illegal to call a life insurance policy a retirement plan.

I encourage you to read my post about the 770 Account here.

But here I’d like to point out a few additional things Palm Beach Letter got wrong in their sales letter for the 702(j) Retirement Plan.

Let’s start with a biggie…

There is NO such thing as a 702(j) or 770 account!

Palm Beach Letter claims “it’s named after the IRS tax code that gives it its tax exempt status.”

But there’s no code named 770 or 702(j) that relates to the tax status of life insurance policies. (And Section 702 relates to something else altogether.) It’s actually IRS Section 7702 that relates to this, and it was added to the tax code by the Deficit Reduction Act of 1984.

Which just so happened to be while Ronald Reagan was President.

Palm Beach Letter uses “770” and “702(j)” as red herrings, so you can’t just search online and find out that it applies to cash value life insurance.  They hope you’ll be so curious that you’ll pay them to get the details.

Devilishly clever… and deceptive, don’t you think?

Because at Bank On Yourself, we believe in being transparent, here is a link to the details of IRS Section 7702.

Palm Beach Letter Continues to Be Clueless About the Guaranteed Growth in a Dividend-Paying Whole Life Policy

As I explained here in my post about the 770 Account, Palm Beach Group doesn’t understand how the guaranteed growth of your cash value is calculated.

They’ve gone even farther out on a limb in their 702(j) Retirement Plan promotion, claiming you can “collect 4-5% on your money, guaranteed.”

That’s not true, although it is true that when you include the dividends, the return can be substantial.

I encourage you to watch this video that shows an actual policy issued nearly 50 years ago and then walks you through how you would have to get a 9.94% annual return in a tax-deferred 401(k) or IRA to equal it.

However, since every plan is custom-tailored, your numbers will be different.  To find out what your guaranteed bottom-line numbers and results would be if you added this safe, predictable wealth-building strategy to your financial plan, just request your FREE Analysis here.

There’s no cost or obligation, so you have nothing to lose and a world of financial peace of mind to gain.  Just click on the button below:


Here’s another thing I take issue with: Palm Beach Letter lists many politicians and well-known people who have owned whole life insurance plans.

Some of these instances are well documented, and I have covered them in my New York Times best-selling book, The Bank On Yourself Revolution and on this website. (See Famous People Who Use the Bank On Yourself Method, for starters.)

However, I have documented all of my sources for that information.

Palm Beach Letter thinks you should just take their word for it – another example of lack of transparency.

What Palm Beach Letter Got Right About the 702(j) Retirement Plan

They really spent enormous amounts of time and money investigating this strategy and have concluded (as I have) that it is an amazing safe wealth-building tool that has stood the test of time.

And because they can afford a massive advertising campaign, they have given the concept even more exposure and credibility.

But if you want the real FACTS about this concept, you’ve come to the right place.

Learn more about Bank On Yourself (a/k/a the 702(j) Retirement Plan) when you download our FREE Report, 5 Simple Steps to Bypass Wall Street, Fire Your Banker, and Take Control of Your Financial Future.


No two Bank On Yourself plans are alike – yours would be custom-tailored to your unique situation, goals and dreams. To find out what your bottom-line numbers and results would be if you added Bank On Yourself to your financial plan, simply request your FREE, no-obligation Analysis today. You’ll also get a referral to one of the Authorized Advisors who can answer any questions you have.


6 Costly Retirement Plan Traps and How to Avoid Them

If you’re like most people I talk to, you’re making several critical mistakes with your retirement accounts.

These mistakes could cost you literally hundreds of thousands of dollars over your lifetime.

But what’s worse is how these retirement plan traps can cost you your family’s well-being, and mean the difference between having to struggle to get by during what should be your golden years … and being able to enjoy life’s luxuries.

With all the economic uncertainties and worldwide turmoil that have been churning the markets, it is vitally important that you know how to avoid these costly retirement plan pitfalls today.

That’s why I’m urging you to join me and our Director of Education, Lee McIntyre, for this special online event. You’ll discover which retirement plan mistakes you are making and how to avoid them.

Space on this online event is limited, and there is no cost to attend.

Here’s What You’ll Discover During This Online Event…

[Read more…]

Vacations are for People, NOT Your Retirement Plan

Do you remember how much value the stock market lost in the crashes of 2000 and 2007? I’m talking about what percent the market lost during each of those crashes.

If you’re not sure, take a guess before you read on.

The tech crash happened just 15 years ago. The S&P 500 lost 49% from March, 2000 to October, 2002. Many investors – myself included – had moved their money into NASDAQ tech stocks, which plunged 78% during that same 2-1/2-year period.

Then the S&P 500 peaked again in 2007 – just a few years later. By March of 2009, it had plunged 57%.

That makes two heart-stopping losses of more than 49% just in the last 15 years. [Read more…]

The REAL Reason Forbes Got Too Scared to Publish the Article They Asked Pamela Yellen to Write

As you can probably imagine, I felt honored when Forbes asked me to write an article for them. Wouldn’t you be flattered if Forbes wanted you to write an article?

It was one of their regular columnists who requested the article, who I’ve called “Pat” to protect the guilty.

Pat had asked me to answer ten questions for publication. The questions indicated Pat knew I have a contrarian take on Wall Street and that I’m a consumer advocate.

I was eager to answer Pat’s questions and tell the world about the scams in the mutual fund industry and expose the wealth-killing truths about 401(k)s and IRAs.

And I supported every statement I made with impeccable and unimpeachable sources, from Morningstar to the Securities and Exchange Commission.

But two days after receiving my article, Pat declined to run it “because there’s just too much controversy.”

So I Published the Article Myself

[Read more…]

The Article Forbes Asked Pamela Yellen to Write – But Got Too Scared to Publish

Recently I was asked to write a full-length article for the Forbes website by one of their regular columnists, who I’ll call “Pat” to protect the guilty.

Pat had taken my Financial IQ Quiz and found it very insightful. So Pat asked me to answer ten questions in writing for publication in Pat’s column.

The questions indicated Pat knew full well that I have a contrarian take on Wall Street and that I’m an advocate for consumers and investors.

They included questions like…

  • “What are some of the scams in the mutual fund industry?”
  • “What’s the shocking truth about 401(k)s and IRAs?”
  • “How can investors protect themselves?”

So I painstakingly answered Pat’s questions, supporting each statement with highly credible, unimpeachable sources including Morningstar, the Securities and Exchange Commission, Government Accounting Office and the Department of Labor.

As requested, I made no mention of Bank On Yourself or the asset it is based on (super-charged dividend-paying whole life insurance).

About two days later, Pat thanked me for sending the article, but declined to run it “because there’s just too much controversy” surrounding my work.

Pat even suggested I repurpose the content for my blog (a good case for “be careful what you wish for”…).

So below are Pat’s questions with my answers in full, which I think you’ll find very interesting. Some of these questions I’ve never addressed publicly before. (Check out question #5 about “what mutual funds do you recommend?”) [Read more…]

A 9.94% Annual Return Without Market Risk? [Video Proof]

What if I told you that it’s possible to get an annual return of nearly 10% – without the risk of stocks, real estate or other volatile investments?

Watch the Video above to see proof of the return of Bank On Yourself (then click on the icon in the lower right to enlarge)

I’m pretty sure you’d wonder what I’ve been smoking!

But I’m going to prove to you how the Bank On Yourself method has achieved that kind of return over the last half century.

To quickly recap, Bank On Yourself relies on a super-charged variation of an asset that has increased in value every single year for more than 160 years – dividend-paying whole life insurance. It’s never had a losing year – EVER. [Read more…]

Get all your questions about Bank On Yourself answered – Live Webinar

You’ve been reading about Bank On Yourself. You may have thought about trying the program. But you might have questions like…

  • “I don’t totally get how the concept works.”
  • “How can I be sure this is really legitimate?”
  • “Could this really work for me in my situation? How can I find out, without actually meeting with an Advisor or feeling obligated?”

That’s why I’d like to invite you to join me and three of the most experienced Bank On Yourself Authorized Advisors in the country (learn why only 200 Advisors have met the rigorous requirements) for a no-holds-barred online event where you can get all your questions answered anonymously.

Space on this online event is limited, so reserve your spot here now. [Read more…]

5 Financial Myths that Are Destroying Your Wealth

The problem isn’t so much what people don’t know, the problem is what people think they know that just ain’t so.”
— Will Rogers

Remember when you were absolutely certain about something that turned out to be false? Like Santa Claus or the Tooth Fairy. Or how about the witch that hides under your bed waiting to attack so you have to flip the light switch then spring into your bed before she gets you? (Okay, maybe that one’s just me.)

In honor of National Financial Literacy Month, let me just debunk a few “things you know that just ain’t so”:

1. You’ll come out ahead by deferring your taxes, and that’s one of the prime benefits of retirement plans such as 401(k)s and IRAs

[Read more…]