Using IBC for Business, with Marcus Toal

Ever wondered how the Infinite Banking Concept (IBC) can protect your family and boost your business? That’s exactly what our client, Marcus, shares in this enlightening episode about using IBC for business. Since 2017, Marcus has leveraged the IBC to support his ventures, from real estate and flipping properties to running two unique franchises – HOTWORX and Destination Athlete. Get inspired as he lays bare his journey from the Navy to becoming a successful entrepreneur.

While we navigate Marcus’s intriguing IBC journey, we’ll also dive headfirst into the world of franchise ownership. Marcus gives us a front-row seat to the realities of owning two franchises, the challenges he faced, and how IBC has been an invaluable tool in his business arsenal. He shares insights about thinking long-term when using IBC and the significance of Key Performance Indicators (KPIs) in pinpointing growth areas. An intriguing highlight is how he cleverly utilized the death benefit as collateral for an SBA loan!

Wrapping up our conversation, we explore the nitty-gritty of insurance policies. Marcus weighs in on the age-old debate between whole life and term policies, stressing the importance of understanding the risks and benefits of each. He also shares his experience with buying additional PUAs and how these steps have maximized his benefits. Listening to this episode will equip you with a wealth of knowledge, not just about the IBC and its potential, but also about the ins and outs of entrepreneurship, business growth, and smart financial planning.

Tune in to find out how IBC for business works!

Podcast: Play in new window | Download (Duration: 52:28 — 60.0MB)

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Getting Started Using IBC for Business

Many roads lead Marcus to where he is today, though most notably, his IBC journey began when he decided to look beyond the insurance offered to him through the Navy. He wanted something more than term, and maybe even something that would be advantageous on his wealth-building journey as a real estate investor as well. 

He stumbled across IBC and some podcasts on the matter, and began to research what a whole life insurance policy could do for his family. In 2017, he began his first policy and has used it many times since then. So even in the early accumulation phase, his policy has created value for his family. 

While he hasn’t yet used his policy for long-term rentals, the first two moves he made were fix-and-flips. He’s also used the cash value as collateral for an SBA loan to franchise a HOTWORX, a vehicle for his wife, and even funds for a Destination Athlete franchise, demonstrating the breadth of options cash value can provide. 

[05:37] “I’ve always paid it back as soon as that equity comes back in. So pay it back, then reuse it again. But if any bit is deployed, I like to pay it back down to zero before I use it for anything else again.” 

Making Your Own Terms with IBC

What makes IBC function well, and what Marcus demonstrates so avidly, is being an “honest banker.” In the same vein, you might hear us say, “Don’t steal the peas.” The sentiment behind both phrases is that you’ve got to be responsible with your money. And when you take a policy loan, you want to repay it. This is the best way to replenish your capital and use it again. 

While you certainly don’t have to, it’s this mindset of good stewardship that prevents problems down the road and ensures that your policy keeps running smoothly. Marcus’ own family uses their cash flow from the assets that they purchase in order to replenish their capital first, then they experience the benefits of that cash flow second. This allows them to accelerate their asset base early on because they’ve got the cash value free to re-invest. 

[08:33] “That’s one of the things I love: you can make your own terms.”

Marcus shares that in busy seasons, his Destination Athlete business does so well that he can make additional payments on his policy loan. While that means there’s cash flow he’s not seeing right now, it also means that his loan will be paid off that much sooner. Then the cash flow from Destination Athlete can be pure cash flow for his family, and he’s got cash flow ready to be deployed elsewhere. 

[09:00] “I don’t let it bleed over into what our personal [income] is, and my income from the Navy, or rental. So I keep it all segmented into what I’m using it for at the time, and let that actual asset pay back the loan.”

The Death Benefit is Critical

For Marcus, part of the initial draw to IBC was the death benefit. As life insurance kept coming up in his research, this was one of the critical elements that drew him to the concept. 

[29:55] “[The death benefit is] a huge part to me because I want to leave something to my children, and to my wife if she’s still here whenever I pass. I did about six months’ worth of reading and listening to that podcast, and that’s when I found The Money Advantage podcast.”

Whole Life vs. Term Insurance

Somewhere along his journey, Marcus was told by another advisor that whole life insurance is bad, and agents only sell it for the commission. He was baffled when Marcus shared his experience. The thing is, there are bad apples in every industry. There are a few who give the whole profession a bad name, and unfortunately, whole life insurance has a poor reputation–especially when it’s lumped in with universal life insurance. 

The truth is that whole life insurance and term insurance are both assets that have their place in your financial portfolio. Convertible term insurance, for example, can help you lock in your insurability now, so you can convert to whole life insurance later. This is great if you’re not yet ready to commit to whole life, yet you want the coverage and peace of mind that a policy provides. Term insurance is also ideal for getting more death benefit if you cannot yet afford to buy the amount you want in whole life insurance. But whole life insurance is the permanent, safe solution that gives you a place to store cash. Term insurance just doesn’t do that. 

Many people who sell term insurance only advocate for a “buy term and invest the difference” strategy. However, many people don’t make it to the “investing” part for any number of reasons—they don’t know how to invest effectively, they lack the capital to invest significantly, they don’t have the discipline, etc. Whole life insurance allows you to do both–create a savings discipline that builds capital so you can invest outside the stock market, as Marcus brilliantly demonstrates with his own investments. 

One Multi-Purpose Asset

The advantage of whole life insurance over most other assets is that it can provide many benefits and results from a single premium payment. Rather than splitting your dollars between many different buckets, you have one large pool that can be leveraged for any purpose. Meanwhile, your money is protected, growing, and liquid. And at the end of your life, you’ll leave a death benefit to your loved ones. 

It’s an asset that streamlines your money to make it more efficient for you. Marcus’ family is proof, as they’ve leveraged cash value for real estate, personal purchases, business franchises, and more. 

[40:35] “Yes you have to pay it back, and yes you’re going to pay interest on it, but it’s being treated and earning dividends uninterrupted while you’re also simultaneously using it… Then if I can do that and also secure a death benefit while doing the same leveraging with those funds, it just makes sense.”

Book A Strategy Call

Do you want to coordinate your finances so that everything works together to improve your life today, accelerate time and money freedom, and leave the greatest legacy? We can help!  Book an Introductory Call with our team today https://themoneyadvantage.com/calendar/, and find out how Privatized Banking, alternative investments, or cash flow strategies can help you accomplish your goals better and faster. That being said, if you want to find out more about how Privatized Banking gives you the most safety, liquidity, and growth… plus boosts your investment returns, and guarantees a legacy, go to https://privatizedbankingsecrets.com/freeguide to learn more.