While more and more average Americans are finding their way to financial strategies using life insurance, these strategies are far from mainstream.

One of the biggest reasons is that we are simply not taught about these strategies, how they work, nor the value of a guaranteed future cash flow that permanent life insurance provides.

When I got into this business, I already knew what I was doing because I had implemented these strategies myself. Having significant liquid capital was crucial to my ability to enter into an entirely new profession and start my business from nothing.

What I was less prepared for was how much MORE I still had to learn.

What I have discovered by working with real people, with real businesses, real problems and concerns, and real dreams about what they wanted for themselves and their families is that:

We are taught these behaviors by the various financial institutions and government, based on what they want. If we take a hard look, we can see this is true because what they teach us to do is not what they do themselves.

We are taught to give up control and use of our money by transferring it away for as long as possible. And then incentivized, through taxes, to use and enjoy as little as possible.

My clients found me because they felt like something about this was wrong. They just never had a way to quantify it.

Here are the 12 things I’ve learned from real clients:

1. Misuse of Risk – Taking entrepreneurial risk is part of the American fabric. But taking risk on things over which we have no control is a learned behavior – and counter to what we know is right, intuitively. Having some iron-clad certainty in a portion of our lives allows us to take calculated risks.

2. Poor Cash Position – Most people would agree that “cash is king,” but very few people have sufficient cash because they are taught by the institutions (through artificially-low interest rates) that cash has no value.

3. Prioritizing Debt – Prioritizing outflows to other peoples’ financial systems over capitalizing our own “financial system” is a learned behavior. Prioritizing debt leaves us financially weaker and can lead to guaranteed losses of hundreds of thousands of dollars over the course of our financial lives.

4. Conflating Payments with Cost – Focusing on “payments” (or “price”) vs. the actual “cost” is a learned behavior that has caused massive wealth erosion, e.g., the incorrect idea that paying cash has no “cost” because there is no interest “payment.”

5. Future Tax Uncertainty – When asked the direction they think taxes will go in the future, 100% of the people I’ve asked think taxes will go up.

6. Tax-Deferral Uncertainty – Thus, tax-deferral is a learned behavior. Deferring tax in a qualified plan is the conscious and intentional surrender of control and use of our money now, only to, according their own beliefs, pay more tax in the future.

7. Unadaptable Plans – The further down the road we get with status-quo financial plans, the harder it is to adapt to changing conditions.

8. Forced Market Timing – The further down the road we get with status-quo financial plans, the more we must rely on active portfolio strategies that require us to time the market — at a time in our lives when mistakes can be catastrophic.

9. Tax Options Require Permission – The further down the road we get with status-quo financial plans, the more we must rely on permission-based tax strategies like ROTH conversions and tax-bracket gaming which have limitations and divest us of the use of our money.

10. Priorities Will Change – I have met many people who did not place any importance on passing a financial legacy to anyone. And then in their 60s, 70s, or 80s, it becomes the most important thing. I have yet to talk to an 60, 70, or 80 year old who was happy that their term insurance expired because their family “didn’t need it.”

11. Intangible Value of Certainty – Even though intangible, peace of mind has incredible value.

12. The Earlier Certainty is Created, the More Powerful it Becomes – Because of the above almost all of my clients made it a point to tell me they wish they had started earlier. Like, 20 years earlier.

About the Author

My mission is to teach people how to strategically accumulate capital in a way that makes all of their other financial activities perform better, and with less risk.

What are you doing, today, to ensure that you are in a position to take advantage of change, rather than react to it?

John D. Perrings