The Economic Value of Certainty, by Les McGuire (Reviewed)

Les McGuire reveals a timeless truth about the economic value of certainty that goes back as far as scripture.  It’s that to have the highest chance of flourishing, you need certainty, guarantees, and stability. 

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In Jesus’ parable of the wise and foolish builders, the wise man’s house on the solid rock withstood storms.  He was able to go on with life the very next day and continue his livelihood of exchanging in the marketplace. 

However, the foolish man’s house on the shifting sand “collapsed with a mighty crash.”  He would have had to spend time, money, and energy sorting out the mess, rebuilding, and finding a way to live in the interim.

But the storm didn’t cause the advantage for the wise man – it just revealed his leverage point.  The wise man’s confidence came from certainty in his life.

What if there had never been a storm, floodwaters, and winds to test the quality of their workmanship?  Can you imagine the character and mental state of each builder? 

The foolish man may have put a brave face on, but he probably would have walked around every day with a subconscious concern that what he had wouldn’t last.  There would have been an undercurrent of cowardice and insecurity in all his dealings.  That maybe his shortcuts would be found out. 

Meanwhile, the wise man would have had internal confidence that graced his affairs, knowing that he was secure.  He was upright, fair, produced quality work, and probably was highly respected and trusted in his circles.    

The Economic Value of Certainty

In The Economic Value of Certainty, a thought-provoking masterpiece, Les Guire outlines these truths and calls us to our greatest potential.  While the article is about whole life insurance, it’s more about why the certainty it creates is so empowering. 

When you have certainty serving as the bedrock of your financial life, you conserve and maximize, rather than waste the precious limited resources in your life.

Les is a financial thought leader who died in 2006.  However, his ideas and bold, deep thinking continue to influence the industry. 

In today’s discussion of this article, we’ll give you an internal guidance system to help you think about your financial life in a way that gets the best results across the widest range of circumstances.  You’ll expand your vision about your financial objectives and what you want out of life.

Where Does the Economic Value of Certainty Fit into the Cash Flow System?

Choosing certainty starts in your mindset.  It then helps you select financial products that maximize your resources and help you fulfill your greatest potential.

However, certainty is an undercurrent of the bigger journey to time and money freedom. 

That’s why we have created the 3-step Business Owner’s Cash Flow System. It’s your roadmap to take you from just surviving, to a life of significance, purpose, and financial freedom.

The first stage is the foundation.  You keep more of the money you make by fixing money leaks, becoming more efficient and profitable. Then, you protect your money with insurance and legal protection and Privatized Banking. Finally, you put your money to work, increasing your income with cash-flowing assets.

With whole life insurance, especially when used for the Infinite Banking Concept, you can weave certainty into your cash flow system and improve every other area of your financial life.

The Economic Value of Certainty Article Highlights

Economics is about scarce resources.  Our limited resources extend beyond money, to include many intangibles. 

These include assets such as time, effort, focus and attention, hope, faith, love, integrity, desire to contribute and excel, and willingness to take risk. 

Les, McGuire

Economic “costs”, therefore, are not limited to money, but rather any resource which is under-utilized …

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It is entirely possible (and actually quite common) for the disclosed “price” of a choice to be low, but for the economic “cost” to be extremely high.

Les, McGuire

Maximize All of Your Resources

Any stated objective of a financial plan is intrinsically limiting because we can’t know what our needs will be over time.  Instead, we should focus on maximizing all our resources.

… according to the “science of scarcity”, our only stated objective should be to achieve maximum utilization on all available resources with the highest degree of certainty possible.  The client’s stated needs or goals are irrelevant when the objective is maximization.  Most people, limited by preconceptions and misinformation, will shoot for far less than their maximum potential if asked to state their needs and goals.

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There is a difference between methods and objectives.  We need to discover what we want most in life. 

Only when we understand … true desires and objectives can we begin to test the likelihood of various strategies getting … where [we] want to be. 

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[Advisors] must not allow people to believe that their preferred method is the objective in and of itself.  It will inevitably lead to economic risk and loss every time.

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Like in chess, you need strategic coordination of all of the pieces to be in the ideal position no matter what happens.

If we can identify strategies that out-perform all other alternatives across the widest range of possibility, then we still do not know how things will turn out (best case, worst case, or something in between), but we do know that our selected choices are superior to all others no matter what happens.  In other words, we have maximized, or done the best we could do.

Les, McGuire

Certainty Helps You Maximize All Your Resources

Financial products with risk limit you in other areas of your life, because of the lack of certainty.

Many at-risk products or investments such as Variable Universal Life, mutual funds, IRAs or 401(k)s may work out great in hindsight, but people will not feel safe making significant, bold choices in other areas of their lives based on the expected performance of these assets because there is little certainty ahead of time.  They will be in a cautious, wait-and-see mode through most of their lives.  The true economic cost of this uncertainty over their entire lifetimes is absolutely enormous, but it is not disclosed anywhere in the prospectus or proposal because it is almost entirely “unseen” and therefore undetected.

Les, McGuire

The certainty and guarantees of whole life insurance are its most distinct and valuable benefit.  That’s because it is the basis for bold, confident action in the other areas of your life.  The economic value of certainty is the maximization of all of your resources throughout your lifetime.

The real economic value of Whole Life Insurance is not in the rate of return on the cash value, nor in the ability to borrow at low rates, nor in the estate created for charity or heirs upon death, nor the tax treatment of the policy.  Rather it lies within the world of economic possibility that opens up to the insured during his own lifetime because of the certainty he now has because of the contract guarantees and the resulting choices he can now make in other areas of life without fear, worry, or doubt.  The insured quite literally becomes the beneficiary of his own life insurance policy during his own lifetime, perhaps many times over. 

Les, McGuire

Increase Your Certainty and Maximize Your Money

If you would like to maximize your money and your ability to achieve everything you want in life, reach out to our team by booking a Strategy Call. 

We can help you personally implement Privatized Banking with whole life insurance, discover cash flow strategies to keep more of the money you make, or increase your asset-based income with alternative investments. 

Success leaves clues. Model the successful few, not the crowd, and build a life and business you love.