Category: Bank On Yourself Policy Statement

The Surprising Truth About What Happens to the Cash Value of Your Life Insurance Policy When You Die

April 18th, 2017 by Pamela Yellen | 6 Comments

In Part 1 of this two-part series, I proved the media’s financial gurus are wrong when they claim that it takes years to build cash value in a whole life insurance policy.

In this second part of the series, I’ll show you why all the self-proclaimed experts miss the boat when they claim that whole life insurance policies are a rip-off because you build up all that cash value, then the insurance company keeps it when you die and only gives your heirs the death benefit.

It doesn’t have to be that way, my friend!

Click on the policy statement above to see a larger version

Here’s an actual whole life insurance policy annual statement. (This is a different policy than the one I showed you in Part 1.)

This is a whole life insurance policy purchased on my life in 1992. The statement I’m showing you, issued 17 years later, makes some astounding revelations. [Read more…] “The Surprising Truth About What Happens to the Cash Value of Your Life Insurance Policy When You Die”

Here’s Proof That the Financial “Experts” Don’t Know About Bank On Yourself Whole Life Insurance Policies

April 12th, 2017 by Pamela Yellen | 4 Comments

Policy Statement Showing How Whole Life Policies Designed the Bank On Yourself Way are Different From the Policies Most Financial "Gurus" Talk About — Click on the policy statement above to see a larger version

Take a look at this life insurance policy statement. It’s for a policy I took out on September 15, 2002. I’m showing it to you because I want put to rest the misconceptions and untruths the so-called financial “gurus” are spreading about the cash value growth of well-designed dividend-paying whole life insurance policies.

The financial gurus tell you not to buy whole life insurance because your equity in the policy—your cash value—grows too slowly, and you won’t have any equity for the first few years.

This is simply not true of Bank On Yourself-type whole life insurance policies!

You’ll have cash value in the first year with a whole life insurance policy designed the Bank On Yourself way!

Vacations are for People, NOT Your Retirement Plan

September 10th, 2015 by Pamela Yellen | Leave a Comment

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…] “Vacations are for People, NOT Your Retirement Plan”

They’re lying to you, again..

June 22nd, 2012 by Pamela Yellen | 4 Comments

A widely publicized new report from the Federal Reserve shows Americans’ wealth plunged by nearly 40% between 2007 and 2010, due to the collapse in home values and the stock market.

There’s one big problem with the Report, which reveals that the net worth of U.S.families has been reduced to a level not seen since 1992 – it’s one of the biggest lies ever perpetrated on the American public!

Here’s why: You can’t eat a number on paper!

Those statistics about how much Americans’ wealth had ballooned prior to the financial crash were pure fiction. Unless and until you sell your assets and (hopefully) lock in your gains, you have nothing more than a bunch of eye-popping numbers on paper that have lured most Americans into believing they have real wealth and financial security, when they do not.

At least that’s the case for Americans who save and invest the way the conventional wisdom tells us to. But it’s not true for people who use the Bank On Yourself method.
[Read more…] “They’re lying to you, again..”

Bank On Yourself Round-Up for week of July 13, 2011

July 13th, 2011 by Pamela Yellen | 2 Comments

Here are short summaries of three of the most interesting and thought-provoking items that have crossed my desk this week. Enjoy… and tell us what you think!

Would you be prepared if you suffered a 30% pay cut?

A shocking new report reveals that the average person’s pay levels off when they’re in their 40’s. After that, about all you’ll be likely to count on will be cost-of-living adjustments to keep pace with inflation.

That will come as a real surprise to many people who assume their pay will continue to rise as they get older.

And if you lose your job while in your 50’s, you’re likely to remain jobless longer than when you were younger, according to the report.

Read this sobering and well documented article from the Wall Street Journal.¹

What’s your best self-defense? When planning for retirement, assume the only salary increases you’ll get will be cost-of-living adjustments. And identify a worse-case scenario – such as a 20% pay cut during your final ten years in the workforce – and try living on that income and putting the rest into savings.

Is Bank On Yourself too good to be true?

January 19th, 2011 by Pamela Yellen | 85 Comments

A review of my book, Bank On Yourself, in the December 2010 issue of the American Association of Individual Investors (AAII) Newsletter declared that the concept is “too good to be true.”

The reason given was, “A life insurance policy loan is not truly a loan. Rather, it is an advance that the insurer must eventually pay out. Worse yet… policy loans can erode a life insurance policy over time.” It also pointed to “potential tax liabilities.”

This review brought to mind one of my favorite quotes…

If you’re looking for an excuse, any one will do.”

– Dan Kennedy

So I wrote the editor and explained there was some misinformation in the review, and that I would like an opportunity to correct the record, pointing out that their motto is “Unbiased Investment Education.”

The editor told me to let him know what I think is incorrect, and he “will take a look at it.” I suspected he was just “humoring me,” but gave him the benefit of the doubt. However, when I submitted my rebuttal, he replied that they would not publish it because “there are no factual corrections to be made.”

I informed AAII I would be publishing my rebuttal on this website, and let YOU decide who is taking things out of context, committing sins of omission, and twisting the “facts”… and who is being fair and unbiased. We’ll pick three of the most interesting, insightful and/or humorous comments made on this blog and award the posters their choice of a $25 gift certificate for a restaurant in your area or a personally autographed copy of my “too good to be true” book.

Besides that, there are several points made in my rebuttal that I have not made elsewhere, so you will find value in reading this (I made it a bit more colorful for your reading pleasure)…

The “unrealized loss” riddle

December 8th, 2010 by Pamela Yellen | 14 Comments

Note: this post has been updated in November 2011

-$62,734.06. That’s the “unrealized” loss we’ve had in one of the mutual funds in our retirement account, according to the statement we just received.

A $62,734.06 unrealized loss.

I keep staring at the statement, hoping that number will somehow magically turn positive. After all, we’ve had a nice run-up in the stock market recently, and that mutual fund has one of the best long-term track records of any fund.

What the heck is an unrealized loss, anyway?

I realize I’ve lost a whole bunch of money. And I remember working my butt off to make that money!”

A $62,734 “unrealized loss.” Is that an oxymoron, like “Great Depression,” “small fortune,” “accurate forecast” and “quickly reboot”?

I dunno if it qualifies as an oxymoron. But I do know it’s moronic that we pin our hopes and plans for financial and retirement security on things we can’t predict or count on!

My husband Larry is 61 and theoretically four years away from retirement. He probably won’t retire when he’s 65 because he says he’d get bored. But if we were relying on the conventional wisdom about saving for retirement, it wouldn’t even be an option for him.

Did you know that 40% of retirees were forced to retire sooner than planned, due to health problems, job layoffs and other factors beyond their control?

Of course, none of us want to think that could happen to us… but what would you do if it did?

Another mutual fund in our retirement account shows an $8,012.16 “unrealized” gain.

And there lies the rub: You don’t actually lock in a gain or loss until you sell an investment.

(November 22, 2011 Update: Our most recent retirement account statement shows our “unrealized loss” is virtually unchanged since I wrote this blog post almost a year ago. And looking at the Dow’s ups and downs over the past year makes a day on the roller coasters at Six Flags look tame.)

Unfortunately, studies and history show that most of us are far more successful at locking in our losses than our gains.

Can you tell me what your retirement account will be worth on the day you plan to tap into it? (Not what you hope it will be.) If your answer is “no,” how can you even call it a plan? And what will you do if the market plunges by 50% – again – right before you planned to retire?

Bank On Yourself: A financial plan you can count on

December 11th, 2009 by Pamela Yellen | 28 Comments

Oh what a roller-coaster year this has been! Our entire financial system and economy almost fell off a cliff.

And while there are some hopeful signs of new life in the economy, this year has also brought us:

Massive bailouts
A tripling of an already-bloated federal deficit
A falling dollar
Rising foreclosures (and likely to spike as billions of dollars in ARM’s are now coming up for adjustment)
Major banks and investment houses taking on three times (!) the risk they were before the collapse

So what do you think next year has in store for us?

No one really knows for sure. (Well, except maybe the folks at the Psychic Hotline.) So how do you prepare for a very uncertain future?

Here’s a quick quiz that may reveal an answer for you…

What’s the one financial asset that increased in value during the market crash of 2008? And in 1929? And in every period of economic boom and bust in between?

Answer: The product used for Bank On Yourself: Cash-value life insurance.

As I’ve mentioned, my husband Larry and I now have 18 Bank On Yourself policies. I’ve picked one of them to show you how a dividend-paying whole life policy like this can grow over time – even when the markets are plummeting. It’s a great example of how Bank On Yourself gives you the peace of mind that lets you sleep at night.

Here’s how much this plan has grown each year since the beginning of 2000, a period that includes not one, but TWO devastating market crashes. In four of these years, the S&P 500 was down for the year, as you can see in this side-by-side comparison:

If you had put $10,000 into an S&P 500 Index fund at the beginning of 2000, how much do you think it would be worth today?

Take a guess before you read on.