Why early rate of return is unimportant

There are some limiting opinions about the initial or capitalization years of a banking policy.  Probably not among our Bankers here at MFB, but you might get this criticism from your friends if you start bragging over dinner.

The misconception is that since not all of the premium is available as immediate cash value in the early years, then there is some kind of loss going on. This is not true. The fact is investments that can reliably provide returns greater than those that the policy will give you do not come along every day. What investment is there that we come across that we would immediately apply all of our savings to, such that we would need to have access to 100% of our savings in any given year?

If you have done extensive research in a particular fund or index, and have the strongest opinion of its growth in the next year, would you immediately want to shift your entire savings to it?  Probably not.

Yes even though the first years of the banking policy take some time for capitalization, and yes, there is a period in which the total premium paid  has not caught up in cash value, this should not be a deterrent for looking for and investing in good opportunities that you have done the research on and have confidence in a return greater than that which your policy will give you.  Privatized banking, using dividend-paying whole life insurance is an “AND” choice.  You can do both, even early on.  Going all in is probably not something you would do, even if you had never heard of Privatized Banking.