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Hector_LaMarque_-_Presentation_-_02_Product_Portion_of_Presentation
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The speaker discusses the product part of a presentation, specifically focusing on the rule of 72 and the power of compound interest. They explain how different rates of return can impact the growth of investments over time. They also discuss a loan product for debt reduction and provide an example of how refinancing can lower monthly payments and help pay off debt faster. Additionally, they mention the benefits of cash value life insurance. The speaker emphasizes the potential financial benefits and encourages the listener to consider getting involved in their business. Hello, everybody. What we're going to do next is we're going to cover the product part of the presentation. I don't think you need to do that generally. It's going to be very rare that you're going to actually have to go over this information. But sometimes you're going to have some people that are a little inquisitive. They're going to want to know. So what I'm going to do is I'm going to go over each of the different products and how they work. In most cases, once you get into the F&A, you're going to be discussing each product as you're doing the F&A input sheet or when you carry it back. But every now and then, you're going to have somebody that wants a little more information. And this is how you would share this information. One of you had some questions about the security and investments and how that works. And what I want to just kind of give you an idea of some things that we talk about and we teach to our clients. And the first is the rule of 72. I don't know if you guys ever heard of the rule of 72 before. I hadn't either before I got involved in the business. But what it is, and I can read it here, this simple calculation gives the approximate number of years it will take to double your investment. So for example, if you had $10,000 to invest, if you invested that at 3%, 6%, or 12%, if you divide the rate of return into the number 72, that gives you the approximate number of years it would take for your money to double at that particular rate of return. So if you look at 3%, 3% goes into 72 24 times. So if you were going to save money at 3%, like in a CD, which is probably not even 3% right now, $10,000 would double in 24 years, and then obviously another 24 years. At 6%, that same investment, if you're able to get a 6% return, the same 10,000 would double in 12 years because 6 goes into 72 12 times. So it would be 10, 20, 40, 80. But you can see at 12%, higher rate of return, 12 goes into 72 six times. So your money's doubling every six years as opposed to every 24 or every 12. So you can see that same exact $10,000 put to work at 12% would go to 10, would be 20, 40, 80, 160, 320, and 640. Is that a big difference or a little difference? Huge difference. So what we're going to do when we start putting together your investment portfolio, what we're going to do is we're going to look to try to maximize the rate of return and do that in a way that's comfortable for you and that's diversified. And historically, we're going to do a lot closer to 12 than we are to 3%. We're going to go in more detail over the information. Here's a kind of a quick example of the power of compound interest. And what this is is just an example of a 22-year-old, if they were to contribute $4,000 to an IRA each year until they were 28, which is really just seven years, right? If they put $4,000 a year for that period of time, that 10% rate of return, and never touched it again, just invested it and stopped investing from age 22 to 28, and then from 28 to 63, right? That period of time right there, that would grow to $1,256,660. Wow. Which is the one-time investment? Yeah, well, it's that seven year of maxing out an IRA. So you could imagine if you had two IRAs, right? $8,000 a year, and you did it all that period of time, what that number might be, right? Over $200,000. That'd be huge. Wow. That'd be huge. So kind of what this illustrates is that, you know, just putting money to work for you at a decent rate of return can really make your investments grow. So we're going to show you, when we do their financial needs analysis, we're going to actually come back with illustrations and show you exactly what the money you have available to work with and what you need to do. It's going to be very comprehensive. You're going to be really excited about that when I share that information with you. Just like Einstein said, Albert said, compound interest is the most powerful force in the universe. And you can see from that example, it's pretty exciting stuff, right? And then another thing that we do is our loan product, right? Debt reduction strategy that we have. And I want to show you an example of what we do there. And what we do in our loan, when we're helping people get out of debt, this is one of those strategies that we have. We actually have a couple of different strategies. One is using a loan, and that may or may not work for you. I don't know. Or there's no way to find out. What we'll do is we'll take an application, the loan application. It's not a problem. There's no commitment on your part. And we'll find out if that particular solution makes sense for you. If that doesn't make sense for you, then what we're going to do is we're going to use another thing called debt stacking. It's another strategy to get you out of debt. But in regards to whether you qualify for a loan or it makes sense for you or not, we're going to have a strategy to get you completely debt free. That's one of our commitments to you. And that's something you want to do, right? Correct. Yeah. This is one of the ways we go about it. And so this particular client right here, they had a first mortgage of $145,000 and they're paying $1,118 a month. And they had 25 years left on that mortgage. They also had personal debt. That would be like credit cards, car loans, et cetera, of another $32,000. They're paying $1,081 to service that debt. Obviously, it's similar because the interest rate on this kind of debt's a lot higher than this, right? So they're totally monthly payments for $2,199 to service all their debt. And you see the original loan was at $7.99 at 30 years. The original loan amount was $152,000, but their market value of their home today is $225,000. So what we do is we do this. This is our solution. We refinance this debt here, right? Okay. So we refinance that. We took the $145,000 and the $32,000, add it together. So we gave them a loan for $180,000. So that encompassed all. What that does, it serves two things. One is the interest on that is really high. So we converted the high interest to lower interest. And then a mortgage is tax deductible. The interest is, but on personal debt, it's not tax deductible. So you can't deduct interest on your car loans and your credit cards. But if we turn them into the first mortgage, now they become lower interest and they become tax deductible. It's a big, big plus for you. That make sense? Yeah. Okay. So, and what it does also, it reduces that, remember it was 219, I mean, sorry, 2199 to service that debt. Now, when we refinance it, it's $890 to service that same amount of debt. So the payment per month goes way down. So we have a lot of extra cash left now, right? So where we are different from other companies, from like from Countrywide or from other companies that do loans, right? Home mortgages, instead of just doing a loan and saying, okay, we'll take that savings that you had, right, and go blow it, buy a big screen TV and go on a vacation. Our objective is to get you guys debt-free and financially independent, which is what you want, isn't it? Yeah. Okay. So what we do then is we take the savings, right? Which is, you know, $890 a month. We're gonna take 574 of it in this situation and we help them invest it, put it in an investment portfolio. And at 10% for 15 years, that 574 is gonna grow to $237,900. And then the difference at 316, we're gonna add that to the principal of the loan. So we're gonna pay the mortgage off a lot faster. So instead of doing a $1,300 a month, we're gonna do like 1,500 a month. So we're gonna add a little extra principal every month to knock the mortgage down, right, a lot faster. With that, just adding that 316 a month, it pays off the mortgage in 15 years. So now we're 15 years later, right, with this solution, you would have $237,000 of cash and a mortgage completely paid for. All that debt would be gone now. Wow. 10 years ago. Can you imagine, you know, 15 years from now, having no house payment, no car payments, having an extra, you know, that's a lot of extra money every month, right? Yeah. And so what we do then, it's $2,100 a month, you'd have extra now to do whatever, you know, to go live, to have some fun or to invest. In this situation now, what we would do is after the house is paid off, the $237,000 lump sum that you accumulated and invest that with the 2,900 that you have extra every month, if you were to do that to your age 67, that 237 plus the 2,199 a month, at 10% would grow to 2.4 million. So that's what you'd have in your retirement account. Wow. And so like at 10%, that'd be $240,000 a year of income, passive income to you at retirement. See that? Yeah. So let me ask you, like from your perspective, if we could do something like this for you, of course you'd want to go ahead and do that, right? Definitely. Yeah, right. You could do that because we refinanced two years ago and that didn't happen. So if there's a, I don't know that we can, we may or may not, may not make sense, I don't know, but if we can, you would? If it were like that, absolutely. Okay, fantastic. So I want to ask you, I want you to think, because we're going to talk to you, you know, we're talking about you getting involved in our business. I want you to think, if I was to share this information with somebody that, you know, like yourself, right? How many out of 10 people would go ahead and do something like this? If we're looking at everybody. Everybody, yeah, right. Can you see from a business perspective how easy it would be to do this business and to be successful at this? I mean, it's kind of a no-brainer, isn't it? Yeah. And it is, we do tons of loans, just tons of loans. It's really a great part of our business. And so the last thing I'm going to talk to you about is the life insurance and how that works, okay? And the difference, there's two kinds of life insurance. There's cash value life insurance, and all that is, it's cash value life insurance is a life insurance with a savings component. You know, I don't know what kind you have. Do you guys have that kind? Mm-hmm. You have a life insurance policy and it has some sort of a savings in it? Yeah. Do you remember that? Well, then you have cash value life insurance. Oh, okay. Is that a good thing or a bad thing? Well, it's, if you're really serious about getting financially independent and you really want to protect your family the right way, it's the worst way to go. Really? Yeah, it is. And I'll explain to that when I get your policy and I'll look at it and I'll go break it down. Okay, we're gonna do that later because, you know, you've got to, you probably have a bearable universal life or something like that. Yeah, I'm not sure what we have. So, I'm gonna go over that later. But the bottom line is this, the way it works is this, this particular family, this is when we replaced John and Mary, they had $75,000 of protection on each for $150,000 total. And they're spending $114 a month for this protection. What we did after we did that financial needs analysis that we did for you, that we're gonna do for you guys, we found out they actually needed $250 and $250, all right, for $500,000 of total coverage. And we were able to do that same, that coverage for $66 a month. So, we basically tripled the protection for John and Mary for $66 a month. That freed up $48. If you remember on the loan, we freed up money. Our concept is whenever we can save you money somewhere is to take that money and put it to use to help you get retired sooner, all right? So, what we would do is take that $48, if we invest that $48 at 10 or 12%, $48 over 30 years would either grow to 109,000, you'd have 109,000 of extra cash, or 169,000 of extra cash at retirement. Which, you know, every $100,000 helps, doesn't it? Yeah, definitely. So, that's one of the things that we do there is from that portion. What we're gonna do is we're gonna take a look at your program and then we're gonna break it down and go over it in detail. And I'm gonna show you how it works and I'm gonna show you what you can do in lieu of that, right, instead of that. All right, sounds good. All right, guys, those are the three ways to explain each of those major products that we market. And that's really the level of detail you need. Unless the client started asking lots of questions, really what you're gonna do is when you do the F&A and you complete that and you carry the F&A back, you're gonna be covering each of the products in much, much more detail. The initial appointment, you're not gonna wanna go into as much detail because it's really not necessary. They know how everything works exactly. They're gonna really need to know that when you bring the F&A and when you cover each product, whether it's the securities or the life insurance product or the loan program, you're gonna cover that in a lot more detail. The key thing you wanna do, again, is simply get the client comfortable and motivated to complete a financial needs analysis. Financial needs analysis is gonna kind of dictate what we're gonna do and what they need to do and what makes the most sense for them.
