This insurance company has been around since 1841. Right now, being the second largest mutual insurance carrier in the United States, they are guaranteeing a year of 12% annual return. That averages out to over 8% over the life of this policy. You got to check it out. All right, everybody, welcome back to the End Asset Channel. Today, I'm really excited. This is going to be a really fun episode because I'm doing this late in the afternoon. Didn't think I was going to make an episode, but I got something across my desk and I was like, people need to see this. So today we're going to be looking at New York Life Insurance. Now, this is a carrier we have not done much content on in the past. We're going to have another video on them in a couple of weeks. You'll understand more about that soon. But the interesting thing about New York Life is they are a massive company. Number two largest mutual insurance company in the United States. And what I'm going to be sharing with you today is a bit of a bonus promo that they're doing for their clients, people who want policies with them. And so what I'm going to talk about is... a premium deposit fund bonus. Now, this is not something we've talked about the channel. Not many carriers do this, but in a nutshell, applications from today placed through the end of November, so November 30th of 2025, in that application, if you want a premium deposit fund, which we'll define that for you here in a bit, they give quite a generous bonus on top to make that much more efficient. So that's the overview. I think you guys are going to have a lot of fun and we'll dive into it. All right. So for those that don't know, what is a premium deposit fund? Well, I've done another video on this in the past that you can find it right here. That video describes what I call a backpack. So think of it this way. If you have a whole life insurance policy, you have a premium obligation to that policy every year on the minimum side, right? You can also overfund it, make it more efficient, but at minimum, you got to come up with that premium every year. But what if there was a way to attach something to that whole life insurance policy that pays for the premium for you? That's what I call a backpack. And that's the premium deposit fund. New York Life calls it a premium deposit account. Effectively, all it is, is we set money with the insurance carrier up front. They grow it at a guaranteed interest rate similar to a CD. But unlike a CD, every year, as your premium on your whole life insurance policies do, They're going to pull from that deposit fund that's growing interest and pay your premium for you. So this is a true set it and forget it strategy for a lot of people. Set up this fund. The fund pays the overfunded whole life insurance policy. And then you're done. You just allow it to grow and compound year after year. Now, this is the really cool rate about the bonus that New York Life is running right now. Right now in the marketplace, if we think of a company like Guardian or Mass Mutual or Penn Mutual or even Lafayette Life Insurance. PDF rates vary. On the low side, it's about 4%. On the high side, it's about 5.5%, guaranteed over a set timeframe, which in most cases, we fund somewhere between 7 to 10 years. Newark Life is doing the unthinkable, in my opinion, and they're giving you a bonus. So first year, they're going to pay either a 12% or a 10% enhanced return on that year. That's nuts. That's a huge amount of interest paid to you in the very first year, which is really, really cool. Now, The caveat is it depends on how large your insurance policy is. So with premiums amount of over $25,000, you can get to the 10% rate. So that is the minimum premium that we would need on an insurance policy to qualify for this enhanced rate with a PDF. 12% that's for much larger policies, $100,000 or more of annual premium pushes you into that premier rate. All right. So the numbers are really going to tell a story, but to take a step. back to take a step back for a moment here let's talk about just the general benefits why does this even make sense well if you think about it if they're going to pay you to hold your capital and also pay your insurance policy for you they're effectively reducing the out-of-pocket cost at the 12 interest rate enhancement we're looking at a decrease in premium costs of around 23 over 10 years so set another way if i put in a 10 today And that buys me a certain amount of life insurance. If I use the PDF instead, I could put in seven and a half dollars and buy the same amount of insurance because that difference, that 25, 23% difference is being paid for by the insurance company because they're paying you to be a customer from the PDF. So that's a pretty cool, pretty cool idea. Boosting your purchasing power. It's the other way to think about it, right? So it's either decreasing your cost or making your dollars more effective by giving you more. insurance and allowing you to buy more insurance. And that can boost up to 30% with the same outlay, same out-of-pocket outlay, 30% more benefit. from death benefit cash value growth etc so it can be a pretty powerful tool in and of itself and to kind of put this in perspective for you this is a simple graph the numbers are kind of hard to see here i apologize but on the left hand side we've got zero ten twenty and thirty dollars and on the bottom we have five six all the way up to ten years so what this is saying is by putting putting your money into in a PDF where we're doing a couple of things. One. we're giving a cost reduction. So what we're actually buying is $14, but it's allowing us to buy as if it's with $16. And if we look at this over time, the longer the PDF is enforced, the more interest that you can compound. The far right example is saying, look, you're buying $23 in this example. That's what you're putting into the system, but actually they're allowing $30 to impact the policy. That's the purchasing power. of the $23 that you put in. So just noticing because they're growing your capital, it's kind of taking a life of its own and increasing the overall rate. All right. So this is probably the slide. A lot of you guys didn't know it was coming, but you'll like that it's here. These are averages. So if we look at a 10 year timeframes, what I did, we're saying, all right, if they pay a 12% the first year and then pay me their normal rate, which right now 5% for the remaining of that PDF over a 10 year period. What does that average out to? How do I quantify that in my mind? Well, those are the numbers on your screen. So on the high end for large policies, as I said, we get almost an 8% return every single year on average for 10 years. And that's just on the outside of it. On the inside, once the backpack pays into the insurance policy, now you have those dollars working for you inside as well. So you're capturing money and interest coming in. Then you're going to grow that money and interest over time with a policy dividend. And that's going to grow tax deferred guaranteed for the rest of your life. The only question at that point is how fast, which as we know, comes from that dividend. And so with New York Life being around for a hellacious amount of time, very, very strong financially rated carrier, dividends, while not guaranteed, are very strong assumptions, which will drive these insurance policies very, very well in the future. So on the high side. almost 8%. On the low side, effectively 6%, just depending upon how long the PDA or PDF is in force, as well as what amount you put into it, which gets you the different bonuses. Now, something that is beneficial to mention as well is just like a CD at the bank, they're guaranteeing a rate for a set period of time. So if you lock in a 10% rate and in the very first year, let's say it's the far right example, and that 6% roughly is what you're averaging over that 10 year timeframe. Two years from now, rates could go to 0% again from the Fed and they still have to pay you a 6% average. That's powerful. That's really, really powerful. So we see a lot of our clients use this strategy as a set it, forget it, put it inside of a trust, perhaps fund an insurance policy for a grandkid or for a child of their own as an inheritance. And these types of situations where it's one time set up locked in a really, really good rate. And now it's just the insurance. company and their guarantees as well as dividend growth that drives everything else for you. All right, guys. So the lock in feature is actually pretty important. This is a promo, right? It's only around for applications placed and submitted before the end of November. So number 30th of 2025. Once that application is placed, then we have a 60 day lock period where We can go through underwriting, get an approval. Upon approval, we have the PDA agreement where you agree to the rates and the bonus. And then depending upon how close we are, we do have a slight backdating window of a comical seven days, which I just think is funny. That might allow us to maintain that lock rate. Right. So this would not be an ideal case for somebody who has complicated medical issues where underwriting may take a long time. But for individuals who are insuring perhaps kids, young, healthy adults, or they themselves are young and are just healthy individuals. this can be a great opportunity. Okay. So before we dive into some serious numbers, because I do have some illustrations to share with you guys today, I want to talk you through the changes and really what that allows me to do as an agent to flex these policies for different reasons. So on the left-hand side, we see on the screen for new applications, the insurance carrier New York Life is increasing their OPP limits. What is that? So OPP, I don't know why New York Life has to be different, but that's their paid up additions writer. So normally they have a maximum of about 10 times the base premium. 10 times the base premium can be paid in PUAs. They are increasing that limit through the end of the year. So this is actually a bonus that goes on longer than the PDA bonus. But through the end of the year, they're increasing that to 50 times. That's a lot. And so what this allows us to do is I can now build a front-loaded design insurance policy with New York Life that has a large degree of liquidity the very first year. It actually becomes almost the most competitive product on the market until the end of the year, which is pretty insane. Because normally, they're not that competitive for front-loads. But if we look at this, they enhance the amount of paid-up additions we can put in. That's also enhanced for 1035 exchanges. Sometimes you're bringing in a large cash value from another policy. If you want us to do a review and see if that could make sense, we'd be looking to do a 1035 where we take the cash value from one policy, roll it tax free into the new policy where it continues to grow tax deferred. And that exchange can be fairly large because of the 75 times room, I guess you could say, in that policy premium. So. I'm saying a lot of words, but I want you, what I want you to get is there's a secret in this, in this situation right here. This is a bit of a crazy hack that I was working on with the New York life team. So imagine this, let's, let's say we start an all base policy. So all base premium in the very first year, we just happened to fund it with a maximum amount of paid up additions that we can. So massive, massive front load. Then we couple it with a PDA. What I mean by that is that That deposit fund is going to pay that base premium moving forward. You pay the front load, you pay the PDA, and the whole policy is taken care of. So what did we effectively just do? I'll show you. Let me share my screen. Hey, it's Alden Armstrong, the head of product and case design here at Better Wealth. If you're a high earning professional, an entrepreneur, or someone who wants to just take more control over your money, we offer a clarity call. It's a one-on-one conversation where we get to know you, your situation. and advise on whether or not life insurance could help you build a safe, liquid, and tax-advantaged financial foundation. No pressure, no fluff, just a real conversation with an expert to assess if this strategy is right for you. Click the link in the description or comment below, and we'll walk through how we can help you. Back to the video. All right, here we go. So this is a mock-up I'm working on for one of the clients we have, and this happens to be happening right when these bonuses are hitting. So this is a really cool opportunity. What we're looking at on our screen is the very first annual premium. It's about almost $600,000 into this policy the very first year, and then subsequently about $100,000, and that slowly tapers. After 10 years, the policy is offset, meaning no more additional premiums are paid. It pays for itself moving forward. And now you just have a permanent death benefit as well as a cash value that continues to compound. This is that crazy hack example that I was talking about a moment ago. We're coupling a front load with a premium deposit fund on a 10 pay insurance policy. So let me show you what dollars are actually being contributed to this insurance policy and how much the carrier is giving us for being a customer. So if we look at this, this policy qualifies for that 10% bonus. The first year premium, including the paid up additions, as well as the premium deposit fund, a PDA account. is about 1.2 million dollars paid in lump sum now i realize this is a very large premium for a lot of our clients that may not be the realistic number in your mind just mentally cut off the last digit and it's going to be fairly accurate as far as the cash value and the premiums so it could be 120 000 in this example right when we're looking at this we have 1.2 million deployed one and done now that particular person is effectively done with their insurance policy everything else is is going to be taken care of by the insurance. carrier. Now the very first year out of that 1.2, we pull about half, about $600,000 goes in the very first year to pay the base premium and then a whole lot of paid up additions. So early on, we have a very strong cash value as we saw above. What we're seeing here now, however, is that no more premium outlay is required by the insured, the owner of this policy. Annually, there's an additional 95,000 being paid out of the deposit fund into the insurance policy. That continues and then decreases down to 81 over time after we drop off the term insurance rider. So the way this plays out year to year, we have a remaining balance after every premium that's going to earn some guaranteed interest. You'll notice that's 10% because it's in the first year. 10% of that number is here. Add that back, and then the story repeats. Pull out 95,000. You have a smaller starting balance, earns interest, new balance, et cetera. The story continues. So over on this far right-hand column, this is what I think is really powerful. This example shows $1.2 million put into the insurance policy. But because of the fact the insurance company is paying you to be a customer from the PDA, as well as from the insurance policy growth itself with dividends, they are contributing an additional $200,000 into your insurance policy for you from the PDA. So what does this mean? We scroll back up. All right. So if we're looking at this illustration, we've put in 1.2. At the end of 10 years, we have 1.5. So the insurance company has contributed between dividends and guaranteed interest an extra about $350,000 into this insurance policy. You haven't done anything else. This client has not done anything else apart from that one-time payment. What happens after year 10? Guaranteed compounding the rest of your life. The only question is how fast, which is how fast that dividend may grow year over year. So this, in my opinion, is a crazy hack. Partnering the premium deposit account with a front load, putting it together. One and done, very efficient insurance policy long-term. Rate of return internally is gonna average, depending upon age and health, reading between about four to 4.8%. So very strong compounding policy. So to recap, crazy hack, premium deposit account, front load, together, makes a beautiful baby. The other one I wanna show you is just a straight front load. And this is interesting. Normally, as I mentioned before, New York Life is not very competitive when it comes to front-loaded insurance policies. However, because of that enhanced 50 times, they call it the ASBP, but basically it's the base premium of the policy. 50 times that number can be front loaded in paid up additions. And so what I'll show you now is the most competitive insurance product I have ever seen from New York Life Insurance. Something I've said before as well, which my clients may recall when I'm in competition with New York Life, is they don't have to be the most competitive because they have a large. large market share, the second largest market share in the United States. So a lot of their products are not competitive because they're banking on the insurance company market share ratings, financial security to speak volumes beyond how their policies illustrate. That said, still a very good product and carrier. So on your screen now, this is a true front load. We're looking at about half a million dollars going in the very first year, creating about 400, almost 490,000. So if we do some quick math, and this is a preferred rating on a 45-year-old, quick math will tell us that this gives us almost 92% cash value in the very first year. That's a lot. That's a really, really cool thing that Neuron Clive is able to do for us. If the person is younger, that number is likely going to be higher because we can buy more term insurance. It gives us more room to put in more PUA. Starting in year two, I then just dropped premiums to show how small the actual policy is. It's about $32,000 per year of base insurance premium with some term. After seven years, we drop the term, drops to 19. And then we have that same situation where we have an offset starting in year 11. All right. So what did we accomplish here? Well, one, we accomplished a huge degree of liquidity in day one, right? It's by 92% in that first policy year. Secondly, we have a very low comparative. minimum premium required for this policy. It's around 6%. So those of you who know 1090, 40, 60, this would be a 694 example. That's the amount of PUA that we're throwing into this policy. Now to play devil's advocate, I'm showing base premium because I wanted to illustrate that big difference in drop-off of what you could do from years one to two. However, you could also continue to fund at a higher level, 100, 250, whatever the number is. all the way up to the maximum that first year of 500 000 it just needs to be approved and underwritten that way at the insurance carrier okay so something i do need to mention is that there are some limits with working with newark life you'll get some more detail on this when we do a carrier review video with them in a couple of weeks but the the point is they have kind of a minimum for brokers so a broker or independent agent somebody who's not in the career agency system like a w-2 system for the insurance company has to come to the carrier with minimum policy sizes. They can't just issue anything they want. That policy size is about $25,000 or more in order to qualify. So because of that relationship and us being independent agents, these do need to be slightly larger policies. So some people just wouldn't qualify from a funding perspective. That said, if you do, and you're sitting on capital you want to deploy, this could be a very good opportunity within the next 30 days. All right, guys, so just to start to land the plane here, coming down to brass tacks, who actually benefits from a PDF strategy? Well, the one I see almost exclusively is following a liquidity event. Somebody who's sold a property, maybe they had an insurance claim settlement from a family member or an injury claim settlement, and they're sitting on capital and they want to make sure it's put to good use. Well, What better place to put it to good use with an insurance company paying a very generous guarantee as well as lifetime deferred compounding of those dollars for tax deferred nature. And so that can be a really, really powerful tool, having idle capital and repositioning it. The second one that I see most often is strategic gifting. And this comes into a grandfather, a grandmother, or even a parent wanting to gift money into a trust for the purpose of their grandchildren, buying insurance on them. Sometimes we hear this said as the Rockefeller method or just legacy planning. This can be a very good set it and forget it so that grandma being 83 years old does not have to keep paying premiums every single year into that trust. She does it one time and that's taken care of. The last one is just maximizing policy performance. And this goes into how you have additional leverage on your dollars where you're paying seven and a half and it works as 10. referring back up to that slide we reviewed, showing the purchasing power of your dollars is enhanced because they're also paying you to be a customer through that PDA. All right, guys. Well, it's actually five o'clock my time. So my wife is waiting for me to go have some dinner. So I hope this was valuable for you. I'm going to wrap this up, land the plane. This is a really cool strategy. In the next 30 days, if we have an opportunity to serve you and look at some premium deposit funds through New York Life, I'd be very happy to do that for you. On the other side, if the time frame is too tight or it doesn't make sense, New York life is still a very solid carrier. And through the end of the year, front loaded insurance policies can be very, very interesting. All right, everybody. Well, thank you so much for your time. Appreciate you. See you on the other side.
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