the "program" seems to be a take on the "bank on yourself" idea.
essentially, "bank on yourself" uses a specific type of whole life policy, and one must be very careful to set it up. not all whole life policies qualify.
1. arrange for the "specific" policy (i do not know the precise name, but a company should know which policies let you borrow against 'cash value', without a reduction in the 'cash value')
2. make the payments into the policy; a combination of significant coverage, and 'cash value' element.
3. when you have cash value of a value to allow you to purchase something you would otherwise get a loan for, simply "borrow" (important term) from your cash value. DO NOT ask for a 'withdrawal' or 'surrender'. the insurance company loans you the money, but your 'cash value' does not decline immediately. that means it will continue to earn growth at the gauranteed rate, as if you still had all the 'cash value' remaining (which is very different from regular whole life policies).
4. figure out a re-payment plan (ask a lender what they would charge, and use the re-payment schedule as your plan)
5. Instead of buying "on credit", and making payments to a credit card or bank loan, you make payments into your own 'cash value'.
so what is the benefit? a loan invisible to the credit reporting companies; a loan where you not only have the item you purchased, but also the money you spent on it in the first place; a loan you are never required to payback*; a whole life policy (which may or may not be something you want).
once you completely repay your private loan, you have your entire cash value (increased per rate guarantee), available to 'borrow' again.
*note: if you choose not to payback the loan, interest charges will still accumulate. it is possible to have those charges exceed your cash value, ending the policy entirely.
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Not familiar with 26(f) other than this thread. Many insurance questions/comments on the thread so I'll offer my experience with insurance.
In Feb 1989 I purchased a $100,000.00 Permanent Life Insurance plan for one time payment of $34,817. Over the years, it has increased in Death Benefit and Cash Value. As of end of 2016, the Death benefit increased to $248,513.00 and Cash Value increased $213,389.00.
Now that isn't necesserally a spectacular icrease in 28 years but I did have the security if the insurance amount if my dependents ever needed it. Now with no heirs other than a school teacher daughter, she will enjoy the bonus when I go.
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