The Truth Concepts Blog
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Welcome to the Truth Concepts Blog. We’re delighted you are here! You’ll find many examples and tips for using Truth Concepts in our posts, along with other helpful information you can use in your business. Have you heard about our Free Ten-Day Trial? Click here for details. Looking for something in particular? Check out the Categories in the Menu on the right. Click on a Category to view posts relating to that topic or Truth Concepts calculator. The “Truth Tips” category is for quick tips and updates on various calculators. Please note

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How Do You Calculate the Rate of Return on a Real Estate Deal?

One of the great benefits of using the Real Estate Calculator is that it automatically calculates the Net Cash Out, as well as the resulting Rate of Return. All you or the client must do is plug in the numbers, and you’ll see how good your deal is.  However, there’s a difference between seeing the results for yourself and verifying them through your own analysis. One of my favorite ways to demonstrate this in Truth Training is using the Rate Calculator. This simple calculator allows you to plug in variables

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The Huebner Foundation: Foundational Life Insurance Education

“There is nothing more uncertain than life, and nothing more certain than life insurance.” Solomon Huebner It’s easy to get caught up in the more exciting parts of life insurance, like the infinite banking concept. After all, it’s exciting to think about leverage and cash flow and building your own “bank.” Yet it’s important that we don’t neglect the foundation of life insurance, which is protection and certainty. Whole life insurance is foremost, insurance. And it is the only type of insurance that is guaranteed to pay out—which is one

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3 Non-Financial Assets Clients Can Pass Down

Different stages of life mean different stages of financial advice. And while many advisors do a great job of educating clients on financial products and assets, there’s something to be said about the “non-financial” assets that clients can accumulate. As an advisor, speaking with your clients about their desires can go a long way in building a financial mindset beyond dollar signs. We want to take it a step further. You can help your clients live a richer life and pass down a legacy in a way that transcends money. 

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How to Build Trust and Make Sales

Dan Sullivan of Strategic Coach recently posted on LinkedIn:  “My definition of selling is two-fold. The First part is that you intellectually engage the person you’re selling to with a future desirable result, something that would be an improvement or achievement in their life. And it’s not what you want for them—it’s what they want for themselves.  The second part is that you then enable them to emotionally commit to that goal and then to courageously take action to move forward and achieve the goal. And if you do both

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New Button in Loan Analysis: Difference Between Payments

While the update may seem small, it has a huge impact on user friendliness. The update in question is a new “right-click” feature that does some simple math for you. That way you don’t have to fuss with the copy/paste function if you don’t want to. In a mortgage comparison, like we demonstrate here, it’s important to show the potential savings of a 15-year mortgage vs. a 30-year mortgage. Previously, to do so, you would have to calculate the difference between payments within the Future Value calculator. This meant a

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Truth Tip, “Lost or Found” Payments in Borrowing Strategy

Important Note  – The “Extra Payment Lost or Found” does not add to (or subtract from) any of the calculations. It is just a way to see the difference in net payment at a rate between whatever is in the “Market Loan Rate” input and either: the net earnings rate when “Acct-Cash” is selected  -or- the “Market Loan Rate” when any of the other 3 options are selected. If you have (-100%) in the “Market Loan Rate,” the numbers for the “Extra Payment Lost Or Found” will look skewed because

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Understanding the Participation Ratio in IULs

Earlier this year, we wrote about how to illustrate IUL returns in the Accumulation calculator. The reality is, IUL’s are sold as something they just aren’t—there are fewer guarantees, and a lot is still left up to risk.  Now, we have a new button that illustrates another “lesser-known” provision of an IUL policy: participation ratios/rates. The insurance company sets the participation ratio, and is non-guaranteed, which means it can change from year to year.  A participation rate controls how much dividend a policyholder will receive. For example, say the index

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The Truth About Whole Life Insurance Taxation

Tax language—you’ll often hear talk about tax loopholes, tax breaks, tax shelters. All have a negative implication and show a fundamental misunderstanding of why tax advantages exist in the first place. Whole life insurance taxation is another beast altogether. With whole life insurance, I often hear people talk about how it’s tax free, which is equally misleading. While the death benefit is tax free and there are ways of accessing cash value without causing a taxable event. To say it’s entirely tax free is incorrect.  And yet (outside of one area)

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Can You Save More with a 30-Year Mortgage, Refinanced Every 10 Years?

What’s the major reason that people want to have their house paid off? In most cases, people fear a scenario where they can’t pay their mortgage, so they spend more money up front. Too often, this puts them in the scenario they were trying to avoid. It all comes down to control, and a 30-year mortgage simply gives you more control.  We’re going to run an experiment here, and see how you can actually save more money in your own pockets. Setting Up in Loan Analysis To begin, pull up

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Section 7702 Changes: Is Whole Life Insurance Still A Good Savings Vehicle?

By now, advisors in the industry are well aware that the life insurance industry is going through changes. The end of 2020 introduced recent changes to Section 7702 of the tax code, which hasn’t been touched in decades. While we’ve read mixed interpretations, we’re looking at the whole truth. The truth is, first and foremost, that whole life insurance is an incredibly certain asset. Insurance companies have always met guarantees and have a more than century-long track record of paying non-guaranteed dividends. Even through world wars, recessions, and the Great

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How to Demonstrate the Laffer Curve in Cash Flow

Is it possible to reduce taxes by lowering the tax rate? Let’s talk about the Laffer Curve. This theory, posited by Alfred Laffer during the Reagan Era of tax reduction, may hold more water than you’d think. This is a great exercise for webinars where you’re helping clients understand taxes better (and why they should seek to save on that tax bill as much as possible). What is the Laffer Curve? The Laffer Curve theory, as Investopedia explains, is the theory that as tax rates increase, people become dis-incentivized to

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Does IUL Really Offer Stock Market Returns Without Risk?

Since the IUL (Indexed Universal Life insurance) came onto the scene, it’s been sold as a way to get stock market returns without taking any of the risk. In this case, the risk in question is losses in the stock market. Companies often have a guaranteed minimum interest rate. In theory, this should make you rich, right? So how come so many IUL policies collapse? Flexible premiums are not solely to blame. In reality, guaranteed minimum interest rates have to be tempered somehow. For whole life insurance, minimums can be

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License to Buy vs. Permission to Spend

In the financial industry, and in Truth Training specifically, there are two concepts with similar names that we often discuss. The first is the “License to Buy” idea, and the second is “Permission to Spend.”  Both are important topics, both result from whole life insurance strategies, and we must understand both so that we can help our clients. What is a “License to Buy”? Whole life insurance, as a savings vehicle, provides benefits beyond that of your typical savings account. Not only is the cash value account liquid—it provides growth

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Todd Quotes, Part 4

As we wrap up the first Truth Training of 2021, and the last one in the current Paradigm Life building (they’re moving locations), it feels fitting to add another round of quotes. We’re fortunate to work with some of the brightest minds in the business, and we love sharing nuggets for those minds who could not attend. Or those who could and want to review! Unless otherwise noted, quotes are from Todd. Quotes on Truth “We all want to be right. If you’re really seeking Truth, you have to be willing

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How to Prepare for Truth Training in Salt Lake City

Whether you’ve been to a dozen Truth Trainings, or you’re gearing up for your first, it’s tricky to know just what you’ll need to be prepared. As with any business trip, you can forget some of the small things. Sometimes, there may be “hacks” you had never even considered. Today, we’re giving you an insider’s look at how to best prepare for a Truth Training. With these tips and tricks, you’ll leave nothing up to chance. Tips to Prepare for Truth Training in Salt Lake City 1. Choose Your Hotel

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How to Set Up Dual Screens for Greater Productivity

We’ve shared before the benefits of using two (or more) screens when you’re working. In fact, Todd himself uses more than three screens. Yet without the technological know-how, setting up dual screens can be daunting. Fortunately, it’s easier than it seems. We want to help you be as productive as you can be, so we created this post to help you get set-up on more than one screen with as little hassle as possible.  Why You Should Have Dual Screens Dual screens help boost productivity primarily because they increase the

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Truth Tip, Life Insurance Values

Importing illustrations into Life Insurance Values properly is essential to getting the most from the Truth Concepts software. The importing process will look different from carrier to carrier. Some insurance carriers will export illustrations into a PDF, some will export into an Excel spreadsheet. No matter how the insurance company operates, there’s a way to import your illustrations. Supported Companies for Importing Illustrations Currently, only certain file-types of illustrations are supported. It’s important to note which is which, so you can import illustrations with ease. Here are the carriers and

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A New Way to Calculate Opportunity Cost in Loan Analysis

If you use the Loan Analysis calculator, you’re likely familiar with the “Loan View” provision. This enables you to do a side-by-side comparison of two loans, or view each loan individually. In the latest update of the Truth Concepts software, you’ll now see a third button: “Opportunity Cost.”  The function of this button is to more clearly show what Todd has demonstrated in his comparison of a 15-year vs. 30-year mortgage. That is, you cannot separate the analysis from the time value of money.  In previous demonstrations, Todd has used

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Get the Most from Truth Concepts Tools

Are you getting the most out of your Truth Concepts tools? Let’s take a tour of the tools, and how to use them to optimize the effectiveness of your illustrations. Income Tax Chart The income tax chart can be useful for several reasons. The first and most obvious use of this tool is to know which tax bracket to use for your clients. The second use is to help discuss taxes with your clients. For many, taxes are more abstract than they should be–after all, taxes aren’t in school curriculums.

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Education Calculator Vs. Cash Flow—Which Should You Use?

The Truth Concepts suite is designed to be versatile, and some demonstrations can be done on multiple calculators. One of the primary reasons is because sometimes the work you do behind the scenes isn’t the best way for a client to visualize. For starters, you want to avoid overwhelming clients when you’re building a Prosperity Economics foundation. After all, typical financial planning is a much different approach.  Secondly, some clients are more analytical than others. While a number-heavy chart may be ideal for one client, another client might find the

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Retirement: How 87 is the New 65

How much do you really know about retirement? It’s commonly practiced throughout the world that, at a certain age, it’s time to leave the workforce. Yet do you know why it exists, or how it came to be? And does retirement as we perceive it even work anymore?  The Beginning of Retirement as We Know It The roots of modern retirement can be traced back to 1881, and Otto Von Bismarck. The Prussian prime minister posited an idea—government-backed support for the older members of society. This was a radical idea

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Can Socialism Save Capitalism?

Bill Ackman, chairman of Pershing Square Capital Management, recently proposed an idea to “save” capitalism. Framed as a panacea for growing disillusionment with capitalism, he recommends that every child have a sum of money invested on their behalf. The idea is that an 8% annual return should make them millionaires by retirement. So is this idea viable? Can socialism save capitalism? And is it really the best way to “encourage greater financial literacy”?  Probably not.  Financial literacy is an admirable goal, yet there are a multitude of ways to reach that end.

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Finding the Best Deal in Real Estate Analysis

Whether you’re an amateur or long-time veteran, a smart real estate deal always starts with research. So how do you properly analyze a real estate deal? Whether you’re looking at a residential property, or an investment, don’t go in without doing your due diligence. That’s where the Real Estate Analysis calculator comes in.  Let’s start with a real world example. A couple, after making some wise decisions about their financial strategy, had some available capital to do with what they liked. And when you’re in a position of cash, opportunity

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Truth Tip, Loan Analysis (Remaining Loan Schedule)

How do you calculate the remaining number of months on a loan? This Loan Analysis “hack” makes it simple to determine, all you need is the remaining loan balance, the rate, and the monthly payment. For example, let’s say your client had a remaining loan balance of $50,000 and they’re paying 5% interest on that loan. Their payment is $1000, and neither of you know the exact time frame remaining on that loan. In Loan Analysis, once you fill in the loan balance and the interest rate, right click on

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Truth Tip, Asset Flow (Social Security)

When filling out social security income, there’s a “trick” to doing it correctly. First, you’ll go under the “earned income/ss” tab. If you’re including social security income for someone who has been taking the income, you should do the COL adjustment (if needed) manually. Let’s say you have a 70 year old, and he began taking his social security benefits at age 66. Input the amount he was initially taking, at age 67, so that Asset Flow calculates everything correctly. Then you can choose to include a COLA if you

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