mmb - debt booklet

WORK BOOK

Debt Free Retirement my
money

BANC

HOW MUCH DEBT DO YOU HAVE
COMPARED TO THE AVERAGE AMERICAN?

In 2017, Americans have officially borrowed more money
than they had at the height of the credit bubble in 2008.

TYPES OF DEBT

The total owed by the average U.S. household, by debt type.

Credit Cards Medical Bills

Vehicle and Other an$d 1Pe6rso,n7al4Lo8ans an$d5Ot,h0er0D0ebt
In$st2all8me,n9t 4Lo8ans
$1M7o6rtg,a2ge22

$St4ud9en,t9Lo0an5s

$An1y3Typ4e,o6f D4eb3t

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HOW MUCH DOES DEBT COST YOU?

Taking into consideration the current average interest rates per type
of debt, and average debt per U.S. household, this is how much a
consumer can expect to pay with amortized interest, annually.

CREDIT CARD Current average

$2,766.18 15.59%interest rates:
annually

MORTGAGE Current average

$7,474.24 3.95%interest rates:
annually

AUTO LOAN Current average

$921.00 3.24%interest rates:
annually

STUDENT LOAN Current average

$2,228.05 4.29%interest rates:
annually

If you are a consumer who pays each of the debts listed above,
you could be paying more than $13,000 each year on interest alone.

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MEDICAL DEBT ON THE RISE

A 2016 study conducted by the Kaiser Family Foundation
and the New York Times says, medical debt in a rising issue.

63% 42%

of insured people with took on extra job or
medical bill problems worked more hours to
have used up most or
all of their savings for cover the mounting
bills.
medical costs.

AVERAGE CREDIT CARD DEBT BY AGE

Credit card debt is typically the most expensive and consumes the longest
span of a consumer’s life. What does credit card debt look like by age?

10k Average credit card debt
9k
8k 45-54 55-64 65-69 70-74 75>
7k
6k age
5k
4k
3k
2k
1k

<35 35-44

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NOTES

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Personal
Economic
Model®

Earned Investment/Savings Protection
Income Diverter

Qualified Plan Contributions

Lifetime Capital Potential Investments F Savings Borrowed House
U Funds
T
U
R
E

IL

RISK E F SAFE
S
TY

E L

Emergency Fund

Inflow ► Outflow ► Lifestyle

Lifestyle Standard of Living
Regulator
Tax Filter ©MoneyTrax, Inc. All Rights Reserved.
Personal Economic Model® is a registered trademark of MoneyTrax, Inc.

3 Types of Money Do You Know

LIFESTYLE TRANSFERRED the Answers to...
MONEY MONEY

ACCUMULATED The 4 Most Important
MONEY Financial Questions?

5 Areas of Major Wealth Transfers 1. What rate of return do you have to earn on your savings and
investment dollars to be able to retire at your current standard
1. Mortgages of living, and have your money last through your life
2. Taxes expectancy?
3. Qualified Plans
4. College Planning 2. How much do you need to save on a monthly or annual basis
5. Major Expenses to be able to retire at your current standard of living, and your
money last utill life expectancy?
(i.e. car payments, credit cards, etc.)
3. Doing what you are currently doing, how long will you have
Copyright © 2019 My Money Banc®. All Rights Reserved. to work to be able to retire, and live, your current lifestyle utill
life expectancy?

4. If you don’t do anything di erent than you are doing today,
how much will you have to reduce your standard of living at
retirement, for your money to last to your life expectancy?

Debt Free Retirement my
money

BANC

HOW TO Redirect
USE YOUR Inefficient Dollars
MONEY TWICE
x2 METHOD • Overpayment's
• Savings
CHECKING • Commission & Bonuses
ACCOUNT $ • Roth IRA Contributions
• RMD Withdraws
• Dividends
• Annuity Income
• Tax Refunds

$ Income Deposit Money
• After tax dollars
• Income Collateralization • Salary/Commissions
• Pension Income
• Social Security
• Alimony

EVERY DAY LIVING Write Check
or Pay Online

• Continue making MINIMUM
payments on all debts but
your smallest.
• Maintain lifestyle spending

(hair/nails, shopping, golf, vacations)

Copyright © 2019 My Money Banc®. All Rights Reserved.

SAVINGS & RETIREMENT

Debt Free Retirement my
money

BANC

Permanent Life Insurance Benefits

Tax-deferred HIGH Use as a bank to nance
Cash Value Growth future major capital purchases
Guaranteed 4% Annually
Income-tax free death bene t1
Use Your Cash Value Living bene ts2 (Chronic Illness)
as Collateral Retirement tax-favored
Accessible without penalty
• Borrow up to 95% LTV from the Grow your wealth safely and
insurance carrier’s general account
while your money continues predictably whether the markets
compounding interest go up, down or sideways
• Policy loans are NOT taxable3
• No credit check required Pay Off Debts

Pay Debts Pay o debts with policy cash
value on speci ed dates
• Credit Cards @18% INT
• Student Loan @6% INT When your smallest debt is
• Auto Loan @6% INT PAID-IN-FULL, redirect those
• Mortgage @6.5% INT freed-up monies back to your
policy to replenish some or all
of the POLICY LOAN, until it’s time
again to pledge your increasing
cash value, to pay o the next debt
and so on.

1 IRC §101(a)(1). There are some exceptions to this rule. Please consult a qualified tax professional for advice concerning your individual situation.
2 Use of Accelerated Benefit Riders reduces the Cash Value and Death Benefit otherwise payable under the policy. Receipt of Accelerated Benefits

may be a taxable event and may affect your eligibility for public assistance programs.
3 Policy loans and withdrawals reduce the policy's cash value and death benefit and may result in a taxable event. Withdrawals up to basis paid

into the contract and loans thereafter will not create an immediate taxable event, but ramifications could result upon contract lapse or
surrender. Surrender charges will reduce the policy's cash values in early years.

STEPS TO PAY OFF ANY DEBT

Let’s say YOU have the following 4 debts:

Debt Type INT Rate Balance MO. PMT

VISA 17% $4,080 $200
5% $13,116 $150
Student 5% $20,841 $500
Loan 5.5% $249,543 $1,419
Auto
Loan

Primary
Residence

Using your money twice method, you would HYPOTHETICAL BY THE NUMBERS
make the minimum payments on everything
except the VISA ($200). + $400 Overpayments
For this example, let’s say we identify that we $200 Savings
have an extra $600 each month from = $600 Ine cient dollars
overpayments ($400) and savings ($200).
These ine cient dollars would be redirected to $600 Monthly Premiums
your family MMB, a high cash value x12 Months
PERMANENT life insurance policy. = $7,200 Annually
These monies will grow UNINTERRUPTED
compound interest each year on a tax-deferred $7,200 Buys a Death Bene t of $521,343
basis. to age 100

Let’s assume that your monthly premium to
your MMB is $600 per month; with a
permanent death bene t of $521,343 to age
100. Your strategy is to pay o ALL debts from
smallest to largest by collateralizing your
policy’s cash value on predetermined
calendared dates.
(Google Calendar Recommended)

In the FIRST YEAR, when your policy’s cash _ $4,080 VISA Balance
value exceeds the outstanding balance of your $596 Principal Paid
VISA, you’re going to pledge that cash value, =_ $3,484 New Balance
and borrow money from the carrier’s general $204 Interest Paid
account (@ 5% Interest only) while your money = $3,280 Ending Balance
continues to grow uninterrupted.
Since you’re paying $200 a month against your _ $3,280 Outstanding Bal. After 4ms.
VISA, plus taking out a collateralized loan from $3,280 Policy Loan
the insurance carrier, that debt will be paid o = $0.00 VISA Paid-in-full
early in under 4 months.

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+ $600 Monthly Premiums After your VISA is PAID-IN-FULL, you're going
$200 Paid o VISA to move on to your student loan debt. You will
= $800 Increased Premium now redirect the newly freed-up $200, plus
your $600 monthly premium back to your
+ $800 Monthly Premiums policy to replenish some or all your POLICY
$150 Paid o School Loan LOAN, while paying the minimum $150
= $950 Increased Premium payment against your school loan.
And again, by simply collateralizing your
+ $950 Monthly Premiums increasing cash value, you'll pay-o your
$500 Paid o Auto Loan student loan balance in about 9 months.
= $1,450 Increased Premium
Next, you would eliminate the auto loan.
+ $1,450 Monthly Premiums With increased cash ow from two debts being
$1,419 Paid o Mortgage Loan paid o , you can now redirect those freed-up
= $2,869 Debt Free Savings monies of $950 ($800 plus the newly freed-up
$150) back to your policy to replenish some or
That’s $34,428 Compounding Annually all POLICY LOANS, while continuing to pay the
for Emergencies and Retirement! minimum payments towards any remaining
debt.

By the time you reach your mortgage—which is
your biggest debt—you will be putting a
whopping $1,450 a month towards your
compounding cash value savings. That means
you’ll have more leverage and collateralization
to take out another carrier loan to pay-o your
30-year mortgage in 9-years or less.
With no more debt, the entire $2,869 monthly
would continue compounding interest annually
creating more tax-free savings for emergencies
and retirement.

Financing by collateralization of cash value eliminates the need to borrow money
from banks because YOU ARE THE BANK!
No more need for credit approval to qualify for a loan! Just use your bank to nance
future major capital purchases tax-favored without penalty.

This strategy makes perfect sense to any insurance carrier because should you die too
soon any outstanding loans would be automatically deducted from the death bene t.
BUT while you’re still living you can use your savings for tax-favored retirement
income. And as your savings balance grows, so does your death bene t for your
bene ciaries. WIN WIN!

Thanks to your hard work and sacri ce, you have successfully paid o nearly
$300,000 of debt in 9-years or less utilizing the USING YOUR MONEY TWICE
METHOD!

Congratulations!

NOTES

Debt Free Retirement my
money

BANC

Brass eld Business Park
2232 Page Road, Suite 202
Durham, NC 27703-7724
Direct: (919) 696-9664
Support Team: (919) 896-3180
Fax: (866) 704-9114
Email: [email protected]
mymoneybanc.com