Highlighted

26(f)

Big Leagues's avatar User  Big Leagues  (Opens a pop up layer) Contributor

Hello,
What is the story behind this"loophole "that is closing in March or May next year?
If is legit how do you invest in it?

Thanks.

USAA Social Service's avatar User  USAA Social Service USAA Service

Big Leagues, I'm unfamiliar with the loophole that you are inquiring about. Can you provide additional information? Thank you. ~Darcy

Re: 26(f)

[ Edited ]

golfer5's avatar User  golfer5  (Opens a pop up layer) Contributor

This is the pitch to invest in 26(f)

 

 

 

 

*Edited by Moderator to remove external link.

Re: 26(f)

[ Edited ]

frimble's avatar User  frimble  (Opens a pop up layer) Contributor

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.

 

** i goofed up the submission; no request for follow-up. if you find this useful, or have questions, please email: frimble@hotmail.com.

fvbrooks's avatar User  fvbrooks  (Opens a pop up layer) Contributor

The promo's I've seen reference a Wall Street Journal article saying that "this regulation will cost American savers over $80 billion". That WSJ article is talking about the DOL's Fiduciary Rule, which will require advisers to retirement plans to be fiduciaries, and is expected to eliminate a lot of expensive junk from retirement plans. I have no idea what a 26f program is and I've been a professional investor for almost 20 years. But looking at the websites hocking it (MoneyMorning, etc.) and the way the pitches are written (he made so much, I'll tell you about it in a minute ACT NOW OR YOU'LL MISS OUT, details coming, so much money, ACT NOW, ... you get the idea), it's pretty clearly a sales scam for a very dodgy newsletter.

 

Best to avoid ANYTHING written like that, and remember there is no such thing as 30-40% returns without serious risk. 

RANGDOG's avatar User  RANGDOG  (Opens a pop up layer) Contributor

Whats the store on this 26(f) progam? Sounds to good to be true...

Re +: 26(f) investment programs

njg2's avatar User  njg2  (Opens a pop up layer) Contributor

I am trying to find out about this program.

Re: Re +: 26(f) investment programs

USAA Social Service's avatar User  USAA Social Service USAA Service

njg2 - What program are you talking about? We can have an expert research it for you. - Jason

Popular Topics
Close Pop-up