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Fire Your Real Estate Banker! by Mark Willis, CFP​ Lake Growth Financial Services know who are in debt up to their eyeballs and working 60+ hours a week, or stressing over non-pay- ing tenants, or feverishly rushing from property to property, hoping they can sell a property before the balloon payment comes due. For many real estate investors, the road to becoming a wealthy landlord turned south toward the highway of serfdom, with their banker holding the upper hand. Is there any other way? How can someone who has skill and passion for real estate or their business keep control and a sense of sanity amidst a world gone in- sane? Is there a way to break free of financial slavery to the banks? Yes, it’s simple: Fire your banker! Where is it written that you have to service your debts and pay off a banker before you can enjoy the fruits of your investment? Who says you have to pay interest on your properties, effectively turning all your real estate assets into liabilities? Where did we get the idea that banks were the only ones who could provide the function of banking in our society? You can be your own source of financing - you can rid your financial portfolio of your banker and provide the function of banking yourself. How? The answer may shock you. I’m talking about a modernized form of dividend-paying whole life insurance. It works like a source of capital, a bank, to provide a guaranteed pool of money liquid and avail- able for whatever you need. The funds you accumulate in your life insurance grow safely and predictably every year, guaranteed - no matter what’s happening in the stock market. You can use the equity in your policy like a line of credit to yourself - and you have complete control over how, when and if you pay your money back to your policy. You are in complete control of the entire process. When most people see the words: whole life insur- ance, their mind turns off. Mine sure did! I was taught to avoid whole life insurance even in my earliest days as a financial planner. “A banker is a fellow who will lend you his umbrella when the sun is shining, but wants it back the min- ute it begins to rain.” A in’t that the truth? As we look ten years back on the Great Reces- sion, we can see how much has changed, and how much more has stayed pretty much the same. Home values are up again to 2007 levels. Unemployment is down to pre-crisis levels. The stock market is hitting record highs as I write these words. And yet, not much has changed since 2008 or since Mr. Twain wrote those humorous words - bankers control the money supply, and just when you need the money most, they are there holding all the umbrellas. I have no problem with bankers, personally. Some of my best friends are bankers! In fact, as investors we’ve been taught to use “other people’s money” (also known as OPM) as leverage to help us gain traction in real estate or to get ahead in our business. Other solutions include getting a business line of credit to buy new equipment, or securing a mort- gage on an investment property to renovate and flip a property. These are the standby solutions used by many Americans. But ask yourself - who are the “other people” when OPM is your strategy for leverage? (Remember, lever- age can work both ways - for and against you!) And what do other people want so badly that they’re willing to part with their money and hand it to you? Were you just handed an umbrella on a sunny day? When banks control the environment where your money lives, they win every time. When you control the financial environment in which your money lives, you win. Close to 34% of all American income goes to servicing debt. If time is money, as the old saying goes, that means a full one-third of the day is spent work- ing as slaves to a bank! Think of how many folks you -- Mark Twain Realty411Guide.com PAGE 78 • 2017 reWEALTHmag.com