Invest Your Money in Two Places At Once- Legally

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           Christian Allen

 

In this episode, Barbara and Christian discuss:

• Alternative wealth-building strategies 
• How to get a “Retirement accelerator”
• Investment Optimizer

 

Key Takeaways:

“The key is the alternative space- there’s often a better risk-adjusted return, meaning that you can take less risk and get a better return, sticking with it, being consistent with it, and repeating it until you’ve mastered it more than having a lot of different tactics.” —  Christian Allen

 Connect with Christian Allen:  

http://www.f3assessment.com

Facebook: https://www.facebook.com/MoneyInsightsGrp

 

Connect with Barbara Hales: 

Twitter:   @DrBarbaraHales

Facebook:   facebook.com/theMedicalStrategist

Business website:www.TheMedicalStrategist.com

Show website:   www.MarketingTipsForDoctors.com

Email:   Barbara@TheMedicalStrategist.com

Books:

• Content Copy Made Easy
• 14 Tactics to Triple Sales
• Power to the Patient: The Medical Strategist

YouTube: TheMedicalStrategist

LinkedIn: www.linkedin.com/in/barbarahales

Transcription

Barbara:         Welcome to another episode of Marketing Tips for Doctors. I’m your host, Dr. Barbara Hales.

Today, we have with us, Christian Allen. He is the author of Money Insights for Physicians and the founder and CEO of the strategic wealth-building firm, Money Insights. Christian’s team specializes in helping clients understand and implement alternative wealth-building strategies centered around life insurance but not the type of life insurance you can get when you go to your local agent.

Christian is passionate about making it easier for his clients to build and protect their wealth. And he is here today to share some insights into his strategies. Welcome Christian.

 

Christian:      Thank you so much, Barbara. Excited to be here with you.

 

Barbara:         Thank you. Now, I know that doctors are always getting bombarded by people who are claiming to be the best financial advisors, and despite being strangers to them, just take your money and invest it all with me. So, what makes you unique or different from all of those people that doctors are constantly getting bombarded with?

 

Christian:      Yeah. That is a great question. I think one of the things that are different is that I didn’t start the firm with the plan initially to focus on physicians. It just so happened that I got connected with a podcaster who’s also a head and neck surgeon. And through the connection, the two of us, we were able to really start connecting with physicians specifically.

Several years ago, we really wanted to make a focus on those high-income physicians because there’s –You know, here’s the thing, Barbara. Most people don’t realize like the traditional world of financial planning is just kind of broken. It’s kind of a disaster, right? There’s a lot of noise out there. And just like you’re saying, there’s a lot of questions as to what to do.

So my experience is that people that are successful at building wealth generally, generally, not always, but generally have to and do play in what I call the alternative investment space which is really — Alternative just means like real estate, businesses, commodities, like things that you don’t traditionally get from stocks, bonds, and mutual funds. So, what we’ve done is we created basically a pathway to help physicians go from high income to actually create and build a net worth. Can I throw a couple of crazy stats at you, Barbara?

 

Barbara:         Absolutely.

                                    Money Stats

Christian:      Okay. So, this is kind of mind-boggling. I’m going to get to the physician one in a second but just a couple of stats. So according to the New York Times, 75% of Americans have less than $30,000 in their retirement accounts, right? And 49% percent of middle-class workers will retire poor or near poor. Now, according to Hewitt and Associates, four out of five workers will fail to meet financial needs in retirement.

So, my point here is just that there are some problems out there in the world. And specifically, if you go to the Medscape Physician Report, they suggest that less than 50% of physicians even with an income of around $250,000 as an average are not able to get $1 million dollar net worth, so less than 50% even if physicians can build that net worth. And so here’s the thing. Net worth is a lot different than liquid cash, right? This isn’t saying I’ve got $1 million in the bank. This is just saying I have $1 million that could be through my personal residence, though, you know, retirement accounts and so forth.

So, my point here is just that the traditional way of doing it is broken. And so, my experience has been that by implementing and kind of crossing over, utilizing some of these alternative strategies, again getting into things like real estate where I can use leverage — Once we move into those things, there’s just so much more opportunity for physicians to change that narrative and turn that high income into something that they can actually keep and create net worth.

 

Barbara:         Well, that’s great especially since the average resident that is first going into practice after graduating his training, you know, comes out with 300,000 or so in student loans. Ouch! You know, that’s going to take a while to pay back before you could even start amassing your wealth.

 

Christian:      Yeah. It’s really a difficult thing that — Not only that but most physicians have to start a little bit later in life, right? So not only do they end up having significant debt but they also might be, you know, four, five, six years behind some of their peers who may have graduated in something different that didn’t take all of those additional years of school. There is a hill that needs to be climbed. And I think that’s all the more reason to make sure that you’re doing it the right way, finding ways that really work. And I guess my caution to people is just don’t just kind of, you know, look at the commercials on TV for Fidelity.

It’s not that that’s not a good company but like you’ve got to do more than that. You’ve got to start digging a little bit deeper. And I’m telling you that if you’ll move into that investment, that alternative investment space, there are just so many more opportunities that you can take advantage of as physicians.

 

Barbara:         Now, I understand that you have a core strategy made up of several steps to help people become financially solvent and successful. What are they? Could you explain that to us?

                                Retirement Accelerator

Christian:      Absolutely. I’m just going to hit on maybe a couple of our core strategies that I think really make sense for physicians. So, two of them that I’ll hit on. The first one is what we call the retirement accelerator and it does exactly what we’re talking about. Barbara, you know how when people invest in real estate, almost always people use leverage.

In other words, they have a bank with them, right? It’s not just them going and buying it in cash, right? So, what the retirement accelerator does is it takes that same principle of investing, utilizing leverage. And now, the contributions to the plan, a portion of it is going to come out of my pocket and a portion of it is going to come from the bank. I’m adding that additional component of leverage so that I can take advantage of arbitrage. And so, what we do then is we create a plan where we can bring leverage into retirement planning so it’s very similar to real estate in that way. That’s one. It’s just super powerful. And I mean this when I say that it is the most impactful retirement strategy for physicians. It just is.

So, you need to check it out because I honestly in all my years haven’t been able to find something that’s more unique and powerful and we’re just having a lot of success with it. So, we’re excited about that.

                                    Investment Optimizer

The other one that we use is called the investment optimizer. And in this strategy, what we’re doing is we’re basically replacing a bank with a life insurance policy. Now, that sounds a little bit weird, right? Like why would I do that? But what we’re going to do is we’re going to instead of saving up our money to invest in real estate or whatever it is in the bank, want to put money in a place where we can get an actual return. So, we call that an opportunity fund. And as a cash flow investor, everybody has to have an opportunity fund. Otherwise, you can’t invest, right? So what we do is we show people a better, more effective way to generate real cash flow and then use that money and allow it to flow in and out of the policy, gaining interest regardless of whether the cash is inside or outside of the policy. So that might sound a little bit crazy but if you just go to our website, moneyinsights.net, you can check out the webinars on it. That’ll give you a little bit more, a little bit deeper dive into it.

 

But again, the principle there is to replace the bank account with a place that I’m going to get 5% tax-free interest, completely safe. In that way when I’m ready to invest, I can take it out, borrow it. I can invest it and then I can put the money back and do it again and again. And what happens is that by replacing the bank with this policy, it’s going to dramatically increase our net worth especially over a period of many years. And the reason for it is simply because of the arbitrage, the leverage, and the time value of money. There’s just such a big difference between earning 5% and getting 0.2% with the bank like we are now.

 

Barbara:         That’s true. Is any of that money overseas or that’s all strictly in the United States?

 

Christian:      Yep. Everything’s completely — We’re very much in the white, right? We’re not even playing in the gray. So the only thing that’s different is just that people don’t hear the stuff we talk about as often because it’s not the Wall Street stuff, right, where the high-powered Wall Street stuff that you’re going to see on TV. What we’re going to do is help people get into things like real estate. That’s kind of our core way of helping people to build wealth.

 

Barbara:         That’s interesting. Now, is that part of your idea to invest the same dollar in two places at the same time? What is that all about?

 

Christian:      Yeah. You nailed it, Barbara. So that’s kind of one thing that people hear and they’re like, well, how could I possibly invest the same dollar in two places? Well, okay, so here’s how it works. When I put money into my life insurance policy — So first off, we talk about we’re not going to have this policy — This policy that I’m talking about is not there for the purpose of providing a death benefit. It does because it’s a life insurance policy but the purpose of it is to create a place where I can get a 5%, a safe 5% compounding return and then be able to invest it in two places at once. And here’s how that works.

When I put money into the policy and when I take money out of it, I’m actually not taking money out of the cash in my policy at all. What happens is the insurance company has what’s called the general account of the insurance company. A really creative name, right? The general account of the insurance company. And so, what we do then is we are borrowing from that which means that our money stays in it, stays in, and continues to build.

So how does that play out? I put that when I — Let’s say that I take $100,000 out of my policy to invest in a property. I now have that money in my possession but it’s still in that account earning a return and I’m just borrowing against it. I bring it back and do it over and over again. And what I’m doing is I’m using a concept of building through compound interest and I’m going to only pay simple interest. So by creating that arbitrage especially over time, it has a really big impact on the bottom line.

 

Barbara:         What is the percentage that I would have to pay back if I was borrowing from that policy?

 

Christian:      So, it really just depends on kind of what the investment is but I’ll give you an example. Well, so most people try to do is they try to use their money for a down payment. And then as that money, that investment property spits cash back out, they’ll start funneling it back into the policy. The reality is you don’t ever have to pay it all back if you don’t want to. But the value is, is that as I do get more money, as I have more cash flow coming in, I need a place to save that so that it’s going to keep working for me, right? I don’t want lazy money on the sideline. So, what the investment optimizer does is it just simply allows you to have a holding place where you’re going to just constantly be earning that 5% tax-free, completely safe return. But again, the actual percentage that you have to pay back, I wouldn’t say that there’s anything specific that’s hard and fast on that.

 

Barbara:         Okay. Now, congratulations on getting your new e-book out, Money Insights for Physicians. Tell me about that.

 

Christian:      Okay. So, thank you for bringing it up. I’m super — We’re super excited. My partner, Rod Zabriskie, and I, worked together to write this. And basically, what we did is we took all of our experiences. And we’ve met with now thousands of physicians across the country. One of the things that make us unique is that we meet with people just like we’re talking about right now, Barbara. I meet with people all day every day on these Zoom meetings. That’s how we do it.

So the benefit to that is that we can do it all across the country, right? So anyway, the e-book, and we’re actually going to have it published into an actual book shortly, but the e-book is meant to be a roadmap so that a physician can read that and very quickly understand the five steps that are going to be required to kind of make that shift and really start holding. And so here’s what it is, right? There are a few things that are really important. One, you’ve got to keep more of what you make. Now, what does that mean? It means that tax planning is critical for physicians. They sit in a unique position because of their high income where you have to be more strategic and plan. Tax planning is really, really critical.

 

The underlying investment utilizing leverage is the second part. So, we teach people how to go into alternative assets like real estate we’ve talked about, commodities, closely-held businesses. There could be others. And that doesn’t mean that there’s no room for stocks, bonds, mutual funds. I invest in stocks personally and like to take advantage of, you know, opportunities with really great companies. But the other thing that I really love to do is invest in things that are hard that I can grab, right? That’s why I love things like multi-family real estate which has just generated an incredible consistent return for a really long period of time.

 

I kind of got off on the track here but really the book, Money Insights for Physicians, is really just meant to provide a very simple roadmap to say, hey, here’s where I’m starting out, and here’s where I need to go. What are the steps that are required to get there? And that’s what we layout. And then in about 40 pages, we’ll lay out exactly what someone needs to do to get there. And that doesn’t necessarily mean they have to work with us by the way. What it is is going to show here are the core steps that are needed to go from high income to high net worth. And regardless of whether you’re working with us or other people, it’s going to be incredibly valuable from that standpoint.

 

Barbara:         Well, that certainly sounds not only helpful but quite digestible. How can our listeners get a copy of your book?

 

Christian:      Great question. I want to — I have one other thing that I’ve been recent, that my firm has been recently working on. It’s called the F3 Assessment. And so the best way to get a hold of us, get a copy of the e-book is to go to f3assessment.com. Again, it’s f3assessment.com. And the reason that we set that website up is that we created an actual assessment. It’s really simple. It’s a 15-question kind of, I don’t want to say quiz, it’s an assessment where you can utilize it and get a score back that’ll help you get a better feel for where you’re at and that’ll give you a really great starting point. So what we try to do is help people go with the e-book and the assessment. And if you just do those two things, read the e-book and take the assessment, you’ll be in a really good place. But again, that’s f3assessment.com. It’s the easiest way to get the e-book or take that assessment.

 

Barbara:         Now, the three from the F3 are numerical, not spelled out, correct?

 

Christian:      Yes. I’m glad you brought that up. So it’s F, the number 3, assessment dot com. And it’s actually, so the reason it’s F3 is that our assessment is actually called the freedom factor assessment or we call it a freedom factor score and a financial freedom factor score and so that’s where we got the three F’s from. But yes, f3assessment.com. Thank you for clarifying, Barbara.

 

Barbara:         And thank you for clarifying what the three F’s mean.

 

Christian:      Anytime.

 

Barbara:         How can our listeners, you know, reach you to speak to you further? Is that through the assessment page?

 

Christian:      You can do that absolutely or you can go to our website at moneyinsights.net. We’re really easy to find. One of the things that we’ve really put an emphasis on is getting reviews from existing physicians. But one of the questions you asked me early on, Barbara, was “well, what makes us different?”

I think one of the things that make us different is that we have over 100 Google reviews from physicians, we have a ton of video testimonials because we want people to know that we’re working with people that have been there, they’ve done it. But yes, moneyinsights.net or f3assessment.com. Either one of those will get you — You can get connected with us through that.

 

Barbara:         That’s pretty impressive that you’ve been able to get that many reviews especially video reviews so that physicians looking at them know that they’re bonafide and that you didn’t just, you know, write something up on your own.

 

Christian:      Yeah.

 

Barbara:         And to have that many, I mean, that’s, you know, really impressive.

 

Christian:      Thanks, Barbara. We’ve taken a lot of pride in really trying to focus and do a great job with people. So, we hope that those kinds of things will kind of help set us apart and know that we’re people that you can trust, right? That’s a huge issue, isn’t it?

Like that’s the biggest issue that physicians have, is they’re worried about being taken advantage of. And so for us, it’s our job to prove out that, hey, we’re people, we have a reputation that you can trust and we’re going to do a good job. So anyway, that’s been really important to us. Thank you for the compliment.

 

Barbara:         Where are you located?

 

Christian:      So most of my team exists here in Salt Lake City, Utah. So we have about 10 of us and we work all across the country but we’re all located here locally in Salt Lake.

 

Barbara:         And not that it matters. I was just curious because nowadays especially with quarantining we’re all just on Zoom anyway.

 

Christian:      Yeah. I know. It’s a crazy world we live in these days, isn’t it?

 

Barbara:         It certainly is. Do you have any final tips that you could give to our listeners out there?

                                             Final Tip

Christian:      Okay. My final tip is really simple. You have to go into the alternative space. Okay, I’m going to throw out one more thing that I think is really important. There’s — When we talk about return, investment return, there’s a concept or, maybe that’s not the right word, a phrase that helps us to get a better idea of what a return actually means. It’s called a risk-adjusted return. And a risk-adjusted return just means that I’m not only taking into account the return but I’m also taking into account the amount of risk I had to take to get there.

A lot of people think that the stock market is the only place to do it. But what we find and what’s been true for years and years and years is that in the alternative space, there’s often a better risk-adjusted return, meaning that I can take less risk and get a better return moving into the alternative space. I just want to emphasize if it’s something that kind of sounds scary, just go read, do a little bit of investigating, research. And I think anybody who wants to build wealth has to kind of move into that alternative space. And so that’s what I would encourage people to do as a final thought.

 

Barbara:         Well, thank you so much. It’s been a real pleasure having you here today. And thank you, listeners, for being here, sharing the time with us. This has been another episode of Marketing Tips for Doctors with your host, Dr. Barbara Hales. Until next time.