Using Cash Value in Life Insurance for Partial Note Investing

6 Replies


Can anyone who is familiar or have used Life Insurance Cash Value for Note Investing make a suggestion, source or education material on how? Could I leverage taking a loan (@ decent APR under 5%-6%) on Cash Value on a Life Insurance Policy?

I recall hearing someone talk about this on a Podcast, can't put my finger on it.


Kishore. P

@Kishore P. Every time I have wanted to use the cash value of a Universal Policy, I have had to pull the cash out, as a loan to myself and my policy. The Int Rate is not much. I have not heard of a provider willing to take the cash in a policy as collateral.  Best of luck to you! 

@Kishore P. @Jack Bobeck

Interest rates are typically very low on cash life insurance policies and very convenient to use. I would be happy to tell you about my experience and vendor if you PM me. Thanks

@Kishore P.  

I might have been the one who mentioned it on the podcast.

"Missed Fortune 101" by Douglas Andrew is a good resource that talks about how to utilize your Cash Value on an insurance policy for investments (among other strategies). But the book doesn't tell you exactly what to invest in, but it's really pretty straightforward - use the cash value from the policy to make the note purchase, and benefit from the arbitrage taking place.

I learned the concept from a builder I worked for when I was young. He was borrowing money out of his policy to build houses, he'd sell then these homes and pay back the insurance policy loan. By doing so he made more than enough money to pay his insurance premiums, in essence buying him "free" insurance and then some - since he could put any leftover money in his pocket.

@Jack Bobek: Forgive my naiveté, Can you clarify Why? I would need “use policy as collateral” Isn’t it straightforward, take a loan and buy note. Am I missing something here? Thank You, Jack.

@Darren Eady: I will reach out to you, Appreciate, you taking the time to respond to my post. Thank You, Darren

@Dave Van Horn: It was indeed your podcast I was listening to Duh! You certainly jogged my memory. I will certainly look the recommendation on the book. In theory, my hope is to buy smaller notes and have the cash flow cover the yearly interest I owe on the Whole Life policy and yet keep it intact. Maybe i should consider looking into as well. Appreciate, you jogging my memory. Thank You, Dave

I've done several podcasts and video training classes on how to leverage high cash value life insurance policies. This is a great way to earn more on your investments.

1. You don't want to use a policy loan. Unless you want to pay more in taxes. Your business entity can get a loan with an assignment of collateral against the policy as a personal guarantee. That loan interest is deductible. 

2. I've got a shortlist of banks and lenders who are willing to provide a cash value line of credit.

3. I've got a short intro video on my profile where you can learn a little more about what I do.

4. This subject has been beat to death on this thread:

@Thomas Rutkowski: Appreciate, your response. I will certainly look up the link recommended. 


Kishore. P

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