What does Financial Independence
mean to you?

flag-fireworks-4thWith Independence Day right around the corner, I got to thinking about the real meaning of financial independence.

(Take our survey now and tell us what financial independence means to you.)

For retired Navy Commander and Bank On Yourself revolutionary Bob Chambers, it means,

Spending time with family and friends and having a predictable, life-long income that provides a comfortable lifestyle.”

If you’ve been a subscriber for a little while, you may recall that Commander Bob agreed to share the booklet he wrote, which he called “Financial Independence Made Easy,” after we received an avalanche of requests for it when I posted an interview I did with him.

Commander Bob has been a student of money and finances for many years, and his 20-page booklet is full of profound insights, including:

[Read more…] “What does Financial Independence
mean to you?”

Are you putting your retirement savings in prison?

Ted Benna, "Father of the 401(k)"

Ted Benna is known as the “Father of the 401(k).” In the late ‘70’s, he worked as a consultant to business owners whose main agenda was “How can I get the biggest tax break, and give the least to my employees, legally?”

Ted Benna, "Father of the 401(k)"

Tax nerd that he was, Benna discovered an obscure part of the tax code – section 401(k). Voila! By 2012, nearly 75% of all company pension plans had disappeared!

What does Mr. Benna say about his beautiful 401(k) baby today?

If I were starting over from scratch today with what we know, I’d blow up the existing structure and start over!”1

Uh oh.

Per the US Senate Committee on Health, Education, Labor, & Pensions: “After a lifetime of hard work, many seniors will find themselves forced to choose between putting food on the table and buying their medication.” The U.S. Census Bureau says the average value of 401(k) accounts of pre-retirees between 55 and 64 is only $170,645; the average value of their IRAs is only $147,345. And half of all those close to retirement age have less than $50,000 in these plans.

Something went horribly wrong. Actually, several things went horribly wrong, not only with 401(k)’s but also their kissing cousins: IRA’s, Roth Plans, 403(b)’s, SEP-IRA’s and so on.

And the problems with these government-controlled plans are in these five key areas:
[Read more…] “Are you putting your retirement savings in prison?”

Love and Money: How to Increase Financial Intimacy with Your Partner

Do you keep “spending secrets” from your spouse or significant other?

Has a difference in how much risk you’re comfortable taking with your investments and retirement savings caused friction in your relationship?

Do you feel envious at times of friends, neighbors or family members who have more wealth than you do?

If you were a lot wealthier, would your sex life change in any significant way?

Love & Money
Love & Money

[Read more…] “Love and Money: How to Increase Financial Intimacy with Your Partner”

Why conventional financial planning doesn’t work… and what you can do about it

This short video reveals the problems with the conventional wisdom about financial and retirement planning, and explains why the average family with a head of household age 60-70 has been able to save only 25% of what it will need for retirement.

Many readers of this blog have asked to see more specific examples showing how much guaranteed and predictable income you could have in retirement, using the Bank On Yourself method. So I’ve included a fascinating example on this video.

If you have the feeling your financial plan has been treading water (or going backwards) for far too long, you’ll want to be sure to watch this video now. It’s got some pretty cool animation in it, too!



Find out how the Bank On Yourself method can give you the financial security and predictability you want and deserve. It’s NEVER had a losing year in 160 years! Take the first step right now by requesting a FREE Bank On Yourself Analysis.

Wondering where you’ll find the funds to start a plan? Don’t worry! You’ll receive a referral to one of only 200 advisors in the country who have met the rigorous requirements to be a Bank On Yourself Authorized Advisor and can show you eight ways to find money to fund a plan that can help you reach as many of your goals as possible, in the shortest time possible.

Be Smart: Ignore All The Financial Experts…

Ignore All The Financial Experts Who Advise You to Scale Back Your Expectations and Lifestyle

The chorus of gloomy financial experts is singing a ballad of restraint.  They warn that we all must adjust ourselves to a “new normal,” in which we lower our expectations and scale back our lifestyles.

The supposed villains are many and include: persistent high unemployment; the devastated real estate market; rising energy and food prices; record budget deficits; the possibility of a double-dip recession; international turmoil; and, well… you name it.

You have no choice, caution the pessimistic gurus, but to swallow:

  • Earning less on your investments and savings for the foreseeable future
  • Downgrading your current lifestyle to make up for the loss of investment returnsReduce Your Expectations
  • Having less income at your disposal due to rising prices and the threat of inflation
  • Getting socked with higher tax rates as the U.S. Government struggles to close its budget gap, and cash-strapped states and cities do likewise
  • Pushing your retirement out – perhaps indefinitely
  • Living on less if you do eventually get to retire (that is not only less than you live on now – which these downbeat advisors have always claimed is a retirement must – but less even than “the less” they were already advising you get by on just a few years ago)
  • Sticking with the financial counselors who have been at your side all along because they remain your best source for guiding your future financial planning

To all of these bitter pills, we can only respond… B.S.

[Read more…] “Be Smart: Ignore All The Financial Experts…”

How Good of An Investor Are You Really? Ask Your Doctor!

Executive Summary: The life-long costs of neglecting your health can be staggering.  Expenses include out-of-pocket medical bills as well as losses of productivity and quality of life.  Too many people watch their investments more closely than they do their health. Illness brought on by lifestyle choices, such as smoking, overeating, lack of exercise and stress, accounts for as much as 70% of nationwide health care spending.

By Pamela Yellen and Dean Rotbart

In mid-December 2008, a skeletal Steve Jobs, CEO of Apple Inc., canceled his scheduled presentation at the annual Macworld conference, triggering investor fears that the company’s visionary co-founder was seriously ill.  A month later, Jobs announced his first health-related leave of absence.  He began a second leave this past January.

During the 30-day period when concerns about Jobs originally surfaced, the shares of Apple stock dropped 14%, or $12 billion in market value.Healthcare Costs

The shareholders of Apple weren’t worried about the potential hospital bills and other medical costs that Jobs would incur.  Comparatively speaking, those expenses would be a drop in the bucket.

But Apple shareholders – confronted with the loss of Jobs’s services, perhaps for good – instantly realized the true cost of sickness must also be measured in loss of productivity, leadership and innovation, among other attributes a key executive brings to his or her company.

For tens of millions of Americans who are otherwise mindful of how and where they stake their money and retirement savings – including many successful Bank on Yourself participants – the importance of investing wisely in their physical health is a lesson they have yet to master.

That’s a huge fiscal mistake

[Read more…] “How Good of An Investor Are You Really? Ask Your Doctor!”

Sure-Fire Results: How Old Sensibilities Are Proving a Potent Balm for Modern Personal Finance Ailments

The ’10/10/10′ Formula of Savings Rescues Many Overstretched Family Budgets

Executive Summary: Most modern Americans overspend, assume too much debt, and fail to invest wisely for retirement.  Tim Austin, a leading proponent of ‘old-fashioned’ spending and savings strategies, recommends a time-tested 10/10/10 financial formula: saving 10% of gross income for the near-term; 10% for the mid-term; and setting aside 10% for the long-term.  Austin’s favorite savings tool is specially-designed dividend-paying whole life insurance policies such as those structured by Bank On Yourself’s specially trained and authorized advisors.

Love_and_death.jpg‎ (233 × 358 pixels, file size: 34 KB, MIME type: image/jpeg)

By Pamela Yellen and Dean Rotbart

Even back in 1975, the year comedian Woody Allen wrote, directed and starred in the movie Love and Death, the perception of whole life insurance as a savings instrument designed for fuddy-duddies and masochists was already commonplace.

There are some things worse than death”

…deadpans the film’s protagonist, Boris Grushenko, played by Allen…

If you’ve ever spent an evening with an insurance salesman, I’m sure you know what I mean”

[Read more…] “Sure-Fire Results: How Old Sensibilities Are Proving a Potent Balm for Modern Personal Finance Ailments”

When it Comes to Money Management, Grandma & Grandpa Knew Best

As detailed in the accompanying article, Sure-Fire Results: How Old Sensibilities Are Proving a Potent Balm for Modern Personal Finance Ailments,Tim Austin is one of the nation’s most-respected and leading proponents of revisiting the financial playbooks of our grandparents and great-grandparents.When It Comes To Money Management, Grandma & Grandpa Knew Best

Using the following core principles, Austin’s clients have reversed years of debt accumulation and money struggles, allowing them to pay for their children’s college educations, repay all bank and credit card loans, and save safely and effectively for retirement.

Here in a nutshell is what Austin advises:

  • Save at least two years’ worth of anticipated expenses before investing a single dime in risk-bearing instruments
  • Set aside 30% of gross income, then budget your lifestyle around the remaining 70%.  Ideally, keeping spending to only 50%, or even 40%, of gross income
  • Put 20% of gross income into short-term and mid-term instruments, including whole life policies, certificates of deposit, money market funds and savings accounts.  Save 10% of gross income for retirement in multiple whole life policies, added strategically over time, and designed for income replacement

[Request a free Analysis and find out the bottom line numbers and results you could have if you added Bank On Yourself to your financial plan]

  • Teach your children, even at an early age, about the wisdom of saving, spending and investing with a 1940s and 1950s sensibility When you buy a car, hold onto it as long as it remains mechanically sound.  Only purchase a new car when you are left with no choice.  The same approach should apply to other major capital expenses
  • Stop thinking of a home as an asset.  Moreover, stay longer in fewer homes – or even a single home, thereby greatly reducing total interest spent on mortgages
  • Teach your children, even at an early age, about the wisdom of saving, spending and investing with a 1940s and 1950s sensibility

Small Business Owners Turn to Whole Life Insurance and Other Alternative Financing Options to Overcome Tight Credit

Now is the Best Time to Prepare for the Next Economic Downturn

By Pamela Yellen and Dean Rotbart

Executive Summary: Among the best non-conventional or alternative financing options for small businesses are loans taken against the owners’ or business’s whole life insurance policies.  Correctly structured, policies such as those that conform with the Bank On Yourself strategy, are tax-advantaged and readily accessible sources of the cash that every small business owner requires to survive harsh economic times.

DENVER – Small business owner Terry Hauschulz recently needed a $15,000 loan so that he could pay the tab on his October 15th federal tax return.

Clients of Hauschulz’s 10-year-old medical equipment repair business have been dallying when it comes to paying him.  “Great receivables, no cash,” Hauschulz laments.

The 55-year-old proprietor mulled asking his commercial bank to help tide him over.  “You know what that would be,” he says of the iffy and laborious process of winning a loan approval these days even for those borrowers with good credit.

rejected creditInstead, Hauschulz, like tens of thousands of other self-reliant entrepreneurs, professionals and small business operators, looked to non-conventional finance options.

The solution he selected – borrowing against his individual whole life insurance plan – allowed him to promptly receive the necessary funds without a credit check, without having to submit financial statements, without needing the approval of a loan committee and without any bureaucratic hassles.

[Read more…] “Small Business Owners Turn to Whole Life Insurance and Other Alternative Financing Options to Overcome Tight Credit”

More than 15 Million ‘Zombie Investors’ Unwittingly Allow Others to Feed Off Their Retirement Savings

By Pamela Yellen and Dean Rotbart

SANTA FE, NM  – Officially, neither the U.S. government nor the retirement planning industry keeps count of how many American employees entrust others to decide for them how and where to invest their hard-earned retirement savings.

Nonetheless, there is evidence that the number of these so-called ‘zombie investors’ – those who shuffle forward without using their brains – may already exceed 15 million individuals and is on a sharp upward trajectory.

The march has been fueled by a Greek chorus of government regulators, Wall Street executives, financial planners and media commentators who regularly opine that only by delegating the task of retirement investment to others can individuals assure the optimal long-term preservation and appreciation of their nest eggs.

“Effective management of a retirement portfolio can be a challenging task, requiring significant knowledge and commitment of time,” cautions the Securities and Exchange Commission.

Thus the SEC and the Department of Labor have instructed employers to offer their workers a variety of defined contribution retirement plans, most commonly 401(k)s, “designed to make it easier for investors” to avoid the headaches and inherent risks of managing their own retirement monies.

Easier, indeed!  But wiser and less risky?  Often not

Such full-faith reliance on administrators and funds managers is propagating gargantuan portfolio losses that could billow to hundreds of billions of dollars during the lifetimes of the current generation of U.S. workers.

Already many Americans believe that by the time they retire the Social Security system will be bankrupt

Already many Americans believe that by the time they retire the Social Security system will be bankrupt.

But what wage-earners have yet to comprehend is that many of the personal retirement accounts they are paying into annually at work will – regardless of how the markets perform over the
coming decadesstealthfully bleed each employee of tens of thousands, even hundreds of thousands of dollars that could remain theirs

[Read more…] “More than 15 Million ‘Zombie Investors’ Unwittingly Allow Others to Feed Off Their Retirement Savings”