Can life insurance help you start a business? This article will explore life insurance for start up companies. Historically we see many doing this but how and what did they do? Over the past century, many billionaires and large corporations have implemented Life Insurance as an investment vehicle in their arsenal, but what do they know that we don’t? Why do we not hear more often about this tool that so few have implemented with such great success? Let’s look at a popular figure and his use of life insurance and see what we can learn from them.
Life Insurance as an Investment vehicle
In 1923, Walt Disney Studio was founded by an ambitious man we dearly know as Walt Disney. Walt saw an opportunity in amusement parks, unfortunately he was the only one. At the time, amusement parks were dirty places with “seedy characters”, so it is no surprise that when Walt Disney proposed to open a clean amusement park where parents and kids can have a wonderful time together, there was much ridicule.
After failing to collect the needed collateral to start up his dream, Walt decided to borrow money from his cash value life insurance policy. With that money, Disneyland opened in 1955 and hosted more than 3.5 million visitors in its first year. Did you catch it? Walt Disney used Life Insurance to help him start his business.
Life Insurance For Start Up Companies: What you need to know.
Did you know that your life insurance policy can accumulate cash for you? Life insurance cash accumulation is a safe investment vehicle that can be used to start up business, supplement retirement accounts, send your children to college, or even take that dream vacation you always wished for. Life insurance policies evolved over time giving investors even more opportunity than even Walt could ever dream of.
What many are not aware of is that life insurance can be considered an income insurance policy. What ever premiums you invest will raise with the large indexes of the world, but will never fall. Your investment is guaranteed to grow during a bull market as well as during a bear market. You might be wondering, “If life insurance is such a great investment, why hasn’t my financial advisor told me about it?”. The answer is commissions.
Financial advisors get compensated based on the amount of money you hold in their investment accounts. The moment you put money in an investment such as life insurance, someone looses money (and that someone is never you). As I mentioned earlier, life insurance guarantees your principal to never fall making them great loan vehicles.
In addition, fees are significantly smaller compared to traditional mutual funds investments. While you are paying a percentage of your total investments in mutual funds, life insurance policies usually charge a flat fee which over time is significantly smaller than other fees. As you can see, life insurance for start up companies is a unique way to accumulate the proper money needed to start your business.
For an deeper at how life insurance loans works, and how a life insurance policy can help you start your business, contact your financial advisor for an indept look.