New Trend in Building Wealth Outside The Wall Street with Anthony Faso and Cameron Christiansen

Anthony Faso and Cameron Christiansen are two gentlemen who has a passion for helping people create and preserve more wealth. They are consultants and hosts of the Infinite Wealth Podcast, and they’re also the Founders of Infinite Wealth Consultants. They are from Las Vegas. One of them has served in the US Army and is a self-describing recovering CPA

Anthony Faso served in the US army and a self-described, recovering CPA. He has been a CPA for over 20 years. At some point, he is challenged to find something different until he read the two major books that changed his perspectives, Rich Dad, Poor Dad, and Becoming Your Own Banker by Nelson Nash. He incorporated both of these books into his financial advising practice and CPA firm. He then realized that he can’t be a jack of all trades, master of none. He wanted to be an expert in one area. So he sold his firm and has been an Infinite Wealth Consultant full time ever since.

Cameron Christiansen, on the other hand, moved to Las Vegas 17 years ago and he immediately started a small business. Just like Anthony, he was influenced by the book he read by Nelson Nash. He started sharing with other business owners what he knew and then people were starting to ask for advice. He became an advisor in the industry for 11 years now. He then met Anthony, and just a couple of years ago, they partnered in Infinite Wealth Consultants.

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New Trend in Building Wealth Outside The Wall Street with Anthony Faso and Cameron Christiansen

Brett:

I’m excited about our next guest. This is going to be a fun episode because there are three of us today, folks, these two gentlemen have a passion for helping people create and preserve more wealth. They are consultants and hosts of the Infinite Wealth Podcast, and they’re also the Founders of Infinite Wealth Consultants. They’re out of Las Vegas. One of them has served in the US Army and is a self-describing recovering CPA, and the other is going to tell us a little bit more because I can’t quite see it on this bio sheet. So please welcome to the show with me, Anthony Faso and Cameron Christiansen, how you are guys doing?

Anthony:

We’re doing great and excited to be on your Podcast. Yeah, dude. Thanks for having us.

Cameron:

Thanks, Brett.

Brett:

Pleasure. Let’s start with Anthony, the recovering CPA Faso. And by the way, you can find these fine gentlemen at infinitewealthconsultants.com. Give us a little bit about your story and your current focus?

Anthony:

Okay, well, I like to say that I’m a recovering CPA, I’ve been a CPA for over 20 years, I worked for Price Waterhouse Coopers, CFO for a chain of restaurants. And then I eventually opened up my own firm. But what I found was the advice that typical financial planning was given, and even me as a CPA was given, was just not working. And I came to that realization, particularly in 2008, where I remember that I had one client, he goes, Anthony, I did everything right. I paid off my house, I stayed out of debt, I maxed out my 401k. And then now, all the equity in my house is gone. My 401k is now a 201K. And now I’m 70 years old. And now you’re telling me I need to go back to work when unemployment is in double digits. And then I kind of realized that really hit home to me for one, he was literally in tears standing across my desk. But then eventually I came into tears because I realized that I was on the same path that he was, I started doing some research and there’s a “crash or correction”. About every 10 years, there was in a way there was 2000, the 90s 80s I mean, what’s unreal, is we haven’t had one yet, which I think we’re on the cusp. But what that did is that challenged me to find something different. And so I what I noticed some of my clients did really well in ‘08, ‘09. So I started asking them, what are you doing? Like? What’s your mindset? What? How are you thinking differently? And also, what books are you reading? And so I started following and practicing the same concepts that they were doing. And the two major books that they told me were Rich Dad, Poor Dad, and then also Becoming Your Own Banker by Nelson Nash. And so I started to incorporate both of those books for me personally. But then my clients kept on saying, well, Anthony, what should I do, I don’t fully trust Wall Street. And I want some guidance. So I started sharing what I was doing. And then eventually, I had a financial advising practice and a CPA firm. And I realized that you can’t, I didn’t want to be a jack of all trades, master of none. I wanted to be an expert in one area. So I sold my firm probably about six or seven years ago, and have been doing this full time ever since.

Brett:

Fantastic love that. We’ll dive into some of that stuff here in a minute now. It’s Cameron Christiansen, you’re up go, sir.

Cameron:

Yeah, absolutely. As my story is, I moved here to Las Vegas maybe 16, 17 years ago. And what I did is I immediately started a small business and I had that for man six or seven years. And similar to Anthony in that is I was a small business owner and I did not have an HR department. So I can turn to someone to kind of say, this is what we’re gonna do as far as financial kind of avenues. And so I started looking at my options and to be honest, I was really, really frustrated with the options that were available for me as a small business owner. All the options that I was presented with, were essentially me putting my money somewhere where I was not going to have access to it. And so what I did is actually just set on cache for many years, and kind of kept doing research. And you finally get to a point where you’re just so overwhelmed with the amount of information out there, they just don’t do anything. So I did that for several, he just sat on cash and was frustrated. And to be honest, my story is my wife and I was buying a house. And I walked into this broker’s office, and we’re sitting down with him. And I asked him, I said, Do you have a good book for a young couple. And he turned around, he handed me Nelson Nash’s book, and he goes a father read this at your age, it would have been the difference of millions of dollars. And so I went home, I read that book three times the first night. And, Brett, man, if I’m honest, I was really upset on page 45. In that book, it teaches you about collateralizing. And it shows you that paying cash for any major purchase is not the best option. And so there I was kind of the mid-20s, pretty successful, had a great income, and thought I knew everything. And this book started just tearing apart everything that I knew about personal finances. And really, I felt like I was starting over at that point. And so the strategies that I found in that book were really designed for me as a business owner. And what I did is similar to Anthony, I just started sharing with other business owners that I knew. And then people start asking for advice. And what you find kind of in this space is that once you learn some of these strategies, you almost feel an obligation to share them with others that are in a similar situation. And so I became the kind of advisor. I got in this industry about 10, 11 years ago now. And I met this guy about eight years ago. And then we partnered up just a couple of years ago. And so here we are now fast forward, we got Infinite Wealth Consultants.

Brett:

Amazing. Love it, guys. So let’s dive right in. What in the world is infinite banking for those who are learning about it for the first time? And then the second part of that would be for those that are ultra-wealthy, what are they doing to take advantage of infinite banking?

Cameron:

Great question.

Anthony:

Infinite banking really started from the book called Becoming Your Own Banker by Nelson Nash. And there are other people who are putting their own spin on the word. So maybe it’s becoming your own bank or cash flow banking, or there’s some other terminology, but it all started from Nelson Nash’s book, becoming your banker. And one of the key things he talked about was, you finance everything you buy, meaning, if you pay cash, then we give up interest that we could have earned without money. But then if we use credit, we pay interest. So he’d say we either give up or pay up. Right. And so what he talks about in the book, and we’re kind of just gonna give a high-level example, but what he talks about is creating your own banking system with a high cash value life insurance policy. Now, this policy is I like to say is not your mama’s whole life policy is designed very different, minimize death, benefit and maximize the cash, and what it is, we can leverage that cash kind of like what Cameron had mentioned, instead of us spending it, we borrow against it. Right? And it may sound complicated at first, but you know, it’s just like using a rewards credit card. Let me ask you, do you use a rewards credit card?

Brett:

I do. I have American Express for traveling to Florida or traveling Francis here, we’re getting all our points to get some free flights.

Anthony:

Exactly. So why use that credit card as opposed to just paying cash?

Brett:

Because they’re giving you free flights?

Anthony:

Exactly. You’re gonna buy it anyways. But you add one extra step, your credit card, you get a bonus in the form of miles, if you can understand that, you can understand infinite banking. Okay, perfect. All break it down. Okay, so let’s say you wanted to buy some real estate what we can do is, instead of what do is we use our policy first, to make maybe to do the downpayment, or to pay for it in full. And then by doing that, instead of getting miles, we’re getting more money. And the reason being is because just like when Nelson talked about if we pay cash, we break that compound interest curve, right? We drain our account and buy the asset, and then we save up money to buy another asset, and then we drain our account. The problem is we’re continually breaking the compound interest curve, but by structuring and leveraging an infinite banking policy, we never break that compound interest curve. Because when we go to borrow against the policy, we’re not taking it from the policy, we’re borrowing against it, insurance companies using it as collateral, and you’re actually using the insurance company’s money. So the advantage is your money is still there, still compounding, even though you’re using it, so that’s where you get that extra AK mile, you’re getting more money.

Cameron:

But if you don’t mind, I’ll jump in there and add a little certain to what he just said is there. A lot of times what we’ll do with clients, especially if somebody new like you had kind of propose to us is we’ll break it down into two different categories, what we call it is we say 20%, of what we’re doing is going to be the product. And that’s going to be the whole life insurance policy. What’s really important about the product is that you got to get a properly designed policy. And so proper design you need to have, it needs to have certain features, right, we want to have those loan provisions that Anthony just talked about. But number one, by putting our money inside properly designed policies, we’ve got access to it, we’ve got collateralization, we’ve got creditor protection. So the number one concern with most real estate investors is that they’re usually sitting on some cash kind of waiting for the next deal. And so what we’re doing is we’re just repositioning that cash to kind of have a wrapper around it inside of that policy. And also one of the biggest features is that we also get a really good earnings rate on that cash value. And so those are kind of the features around the 20%, which is going to be the product. What’s even more important is what you do with the money. And what I tell people all the time is that we can get you some we can create some wealth for you, but to be wealthy, is you’ve got to put this money to work for you. And that is going to be the process of infinite banking. And that’s going to create probably 80% of the returns for you. And so your example was using real estate, where you would take you would fund a policy and then you take a loan against your cash value, and then you go buy some sort of real estate investment. We’ve got a lot of clients that use turnkey or permanent syndications. But anything that creates cash flow in that cash flow is going to come back to replenish or repay that loan against your policy. We’ve got many, many examples of clients that will buy cars or will do college tuition or those things. And so the process is really what I would say kind of separates Anthony and I, from most people that are in this space, is the policy is important, but it’s not as important as what you go do with that. And so that’s where we spend most of our conversations with clients is what opportunities can we find to go create cash flow, you’re creating that cash value?

Brett:

Got it. So let me say. make sure if I’m getting this with our listeners here, so you’re using the leverage, you’re leveraging the collateral, which is the policy, and you’re using that amount to go for whatever, buy property, buy whatever. Is that a fair summary so far?

Brett:

Yeah, yeah, very cool. Okay. So now let’s make an example. So I got a million bucks, and I can put this million dollars as a down payment right now for a multifamily property, three and a quarter percent. I have a listing right now. And it’s like $2.6 million. And the bank is saying the loan, about a million and a half. So I can just put the million to the bank and borrow at three and a quarter and buy that property for 2.6 million, but correct me if I’m wrong, are you saying it might be more beneficial to start put that million into infinite banking, life insurance that’s designed with collateralization access loan features, whole life insurance policy product? And then from there, put it as the downpayment, walk me through that?

Anthony:

You basically nailed it, right? That down payment got to come from somewhere, it can come from cash, or it can come from the policy. And the advantage of it coming from the policy. Again, as I alluded to, we never break the compound interest curve. Okay? Now, so that means that policy is continuing to grow. It’s continuing to the compound because we never took it from the policy. We’re actually using the insurance company’s money. And here’s a here’s another piece. Since we’re using their money, they’re gonna continue to pay us interest in dividends, but we’re gonna have to pay them interest. And where a lot of people get stuck is like wait a minute, I just put this million dollars in and now I have to take it out. I have to pay interest. But the thing is, you’re still compounding on your money. So there is a difference between the power of compounding and then a simple interest loan. But and we have done the math and we have a video that crunches it we’d love to do the math is especially me but here’s another one, not only does it work just like that, but however, we can actually create tax deductions.

Brett:

So let’s do the math first guys because I don’t want the tax deduction. So let’s say I put the million dollars as policy, what’s it going to cost to set up the policy? So as my million now 950,000? Is it 985? Is it 900,000? Give me the cost, just to get that million accessible for the downpayment, walk me through that.

Anthony:

Now, there’s a lot of different ways to design it. But we do a lot of times we have some people that have a windfall or a lump sum. Let’s just say they have this million dollars, well, we can design a policy where all they put in is that $1 million, okay?

Brett:

That’s the one I want. This is a wealthy person, they’ve got 5 to 10 million bucks, right? They don’t need or want the cash necessarily, right now, they can put it on the apartment complex, just get the loan at three and a quarter, or B, they can put it into the policy at a million and then borrow from the policy to put it into that property as a down payment. So I just want to just keep it real simple there. So what would it cost them to do that?

Anthony:

Okay, it’s gonna be a little variant depending on the age of the person, if they are healthy.

Brett:

They’re 50 years old, they’re married. Their life expectancies 85-90. They’re doing great.

Anthony:

We just did a similar case on that. At the end of year one, they had 99% of what they put in.

Brett:

Okay, so in one year, know, they’re at 99%. So they’re $999,000. Correct. Okay. But in this scenario, they want to put it there, and then they want to go buy a property as a down payment. So in that scenario, what is it costing to borrow from the policy? And where would it be at the end of one?

Anthony:

What we would be able to do is, we can borrow up to 100% of that value.

Brett:

Okay, that value of the 9000 of the million more of, because there’s got to be fees, right? When we close. So am I drop in and then 100% of that new value, and then it’s building back up? Walk me through that.

Anthony:

I would say if like, say from day three, the number I was using 99. That was at the end of year one. Right? So there is some growth for those 12 months. So I would say that there’s probably maybe a 4% down maybe from 30 days later.

Brett:

So I put a million in, and it costs me about 4%. Give or take. And so then the closing costs, I’ll call it the closing cost right now. And then I’m going to take in that scenario $960,000, right. Is that revenue, the math right there? Yeah. And I’m going to put that and come up with another $40,000. Am I doing that? Right? No, 4% of a million would be more than that. Right?

Anthony:

I guess I actually got it. I’m a recovering CPA, so I don’t do math anymore.

Brett:

4% Yes. 40 grand. I was right. I was right. So get a million minus the 40. So now I’m at 960. Okay, so I’ve got 960. The next day, and now I’ve got to come out of pocket personally for 40. So we’ll do the ROI on that. Am I fallen so far? Yeah. What am I borrowing that? 960 yet? What’s the interest rate on that?

Anthony:

Currently, right now we can get it at 3%.

Brett:

Okay, so I’m borrowing at three. Okay, I’m making up perhaps a quarter percent there because, well, unnecessarily because there’s will a property where well, will bank care where that 960 come from? In other words, it just is going to my account’s personal money. And it’s seen as that? Or is the bank going to scrutinize that 960 and say, it’s coming from this insurance policy? Is it going to hurt me?

Anthony:

Well, like no, it shouldn’t, because we have clients do this all the time, as well. And we and we can explain to the underwriter exactly how the money’s is getting there.

Cameron:

I’ll jump in there from the bank’s perspective is actually put more value on money that is collateralized inside a whole life insurance policy for several reasons. Number one is, is when you look at the stability of insurance companies is the man they sit on cash, they know that if money is sitting with an insurance company, that their amount of risk is almost nil, right? It’s zero. And so an addition to that, because we have it inside of a whole life insurance policy. There’s going to be a death benefit, which is something that we don’t often talk about, because we’re more focused on cash value and what you can do with it, but there will be a death benefit there. And the banks appreciate that, because they recognize that fact that, hey, not only do we have cash, if this guy lives, but also this individual that we’re lending this money to if he dies, we’re still gonna get paid back. And so banks actually put more value on money that is collateralized inside a whole life insurance policy than they ever would with cash.

New Trend in Building Wealth Outside The Wall Street: “We were always focused on our profit and loss statement. But cash flow was not a regularly discussed topic. It was as if we were driving along, watching only the speedometer, when in fact we were running out of gas.”
— Michael Dell, founder and CEO, Dell Technologies

Brett:

Yeah, they’re diversifying the chances of getting paid back, right? They’re saying, it’s a big insurance company that’s going to be you know, perhaps conservative, have a good track record with investments, and then be if they die, right, then it’s tax-free, right? It’s gonna get paid. Is that a fair summary guys?

Cameron:

Great.

Brett:

Okay, so let’s keep an eye on here. So I borrow at 3% or so. So now I’ve got the 960. Now, I take another 60 personal limit because I needed a million for the downpayment. So I’m feeling a village, okay, there, and I’m gonna borrow three and a quarter for the other 1.5 million to buy the properties. Now I bought the property. So now a year goes by, right, essentially, I’m borrowing. You know, $2.5 million, is one way to look at it right? with about a million at about 3%, 960, 3%. And then the remainder about a three and quarter. Okay. And now let’s talk about arbitrage. So you mentioned now investments. So what happened to my 960? What has been the average rate of return? How and where are those funds invested?

Anthony:

Okay, glad you asked. Because you earlier you asked a question about, how would this benefit high net worth clients? Okay, so, here, here are a few, a few things. For one, each state’s different, as you know, but each state has some level of asset protection of the cash value, it’s inside your policy. So there is that asset protection of the cash value? Also, when we are borrowing? So your question was the average rate of return, and it’s about an average of 4%. Okay, but here’s the here’s another thing that’s 4% is after, that’s the bottom line number. So that’s after any expenses, that’s after any taxes. So a high-income individual may need to earn 7%, to maybe pay or maybe eight to pay their advisor, the 1%. But then also pay the IRS. And if they live in the great state of California, they will be paying some more tax as well. So they may need to earn seven to 8%. pay taxes and fees to equal 4%.

Brett:

So pause there, make sure you capture that. Okay, so what you’re saying is, it’s on average, on average, it’s gonna return about 4%. net of fees and net of taxes. Imagine I didn’t take that 960 out. And I simply, I simply had it in there. Am I able to cashflow that 4% tax-free? Is that what you’re saying?

Anthony:

You could.

Brett:

So let’s say I put a million in there. I said, I just want to put it in there. And it’s producing 4% whatever it produces, you’re saying it’s tax-free to me. I don’t pay income tax on that. Is that right? Am I missing that?

Anthony:

No, you’re right. You’re right.

Brett:

Okay. But am I borrowing from myself or my living off the interest that it’s earning?

Anthony:

You could. Do you want to take them?

Cameron:

I was gonna say a great question. So you are kind of diving down into kind of what that looks like, we’ve got kind of 4% that that policy’s earning. So you’ve got a couple of options, right? You can borrow against the right loans, just like a home equity line of credit, if you borrow against that it’s not taxable. And it’s the same situation with cash values. If you borrow against that policy, it’s a non-taxable event. And so you can make it so that it does become taxable, right. But the whole idea of this strategy, same thing, right with a deferred sales trust is what we’re trying to avoid is taxes. And so we’re going to try to put every strategy first that is either tax deferral or tax avoidance tax-free. And so we’re going to put everything we’re going to start with that. I want to touch on something that you just mentioned is if we have a million dollars inside a life insurance policy that we’re borrowing against, and you talked about kind of withdrawing money off of that. There’s a kind of a fundamental understanding, I want to make sure your listeners understand is this is what Anthony spent so much time on kind of that 80% and creating cash flow is ideally for me, my goal is if I have a million dollars of the cash value in a policy is I don’t Want to be drawing off of that million dollars, I’m leveraging that million dollars to create cash flow for me to live off of. And so those assets are creating the income to support my lifestyle. I don’t want to ever draw down to zero my million dollars. So there’s a big difference between kind of someone’s understanding is the cash value is the tool that we use for leverage to go create cash value. We don’t really want to deplete that or draw that down.

Brett:

Okay, term alone, guys. So is this like a five-year term alone? Is there no term on a loan? When do I have to pay back this 960? back? So going back to, I just took the money out as and I borrowed my policy against my policy at 3%. I’m making a 1% arbitrage which I’m making 4%. Right? So making a little bit there. But what’s the term? When do I need to pay it back?

Cameron:

So the terms are dictated by the borrower by the policy owner, right, if we have a loan against our cash value, the insurance company is going to keep a record of that loan. And they’ll send us a statement every single year on that. But as far as how we pay that thing back, when we pay it off, how long we have it outstanding is completely dependent upon the policy owner, what I’ll typically recommend to clients is you let that asset that you purchased dictate that loan repayment. So we work with a lot of guys that do, you know fix and flips and usually, they have money outstanding for three to six months, let’s call it four. And so we’ll borrow that money out, we’re going to want two things. One, we either make no loan payments at all principal or interest, or we make interest-only payments until we sell that property. And then we take all the profits and we put them back inside that policy. If we’re doing a rental right we go buy a rental, we get monthly income that comes back immediately, we’ll start those monthly repayments going back to the policy to replenish those. So you got your options.

Brett:

You want to structure it based upon the cycle of the lifecycle of the deal. There could be prepayment penalties, there could be it could be principal and interest. It could be a balloon payment. It’s flexible, but you just kind of want to just structure based upon each deal. Is that a fair summary?

Anthony:

Correct. And it’s almost like it’s very similar to a line of credit like a HELOC. Right, where the interest-only is due there is no structured, there are no structured terms. What we recommend highly encourage is that we want to pay at least the interest. And we want to do that for two reasons. For one, technically, we don’t have to pay the interest, you can have that added onto the loan. However, we don’t want the interest to accrue. So ideally, we’d want to pay at least the interest. And then probably another big reason to pay the interest is if you use like in this example, we’re buying an apartment complex, and the mortgage that we’re getting from the bank. Now, that’s that interest is tax-deductible. Right? And if we use one of these, your policy loan for an investment purpose, that also becomes tax-deductible. So you start doing the math. Let’s do simple math. As I said, you are in California, let’s just say the tax rate with state and everything is 50%. Okay, so that 3% is really costing you 1.5 after your tax deduction. Does that sound fair? Sure. Okay, but remember that 4% is after taxes. So talk about arbitrage. There’s even a bigger value because your money is compounding at around four. And then that cost you your money is is about 1.5 to two depending on your tax bracket.

Brett:

So be like making five and a half compounds. Is that a fair summary?

Anthony:

Yeah.

Brett:

That’s cool. All right. I appreciate you guys get in the weeds with me here, right? Because this is not easy, right? Because it’s hard. We’re on a Podcast too. It’s better if you see graphs and figures and numbers and have real live deals, but you guys are good sports. You had to go through that. So I want to encourage you guys to go to infinitewealthconsultants.com. If you want to learn more about Infinite Banking, it’s infinitewealthconsultants.com. We’re here with Anthony Faso, CPA, and Cameron Christiansen. So let’s shift guys. We did a pretty deep dive there. And people’s heads are probably a little bit spinning. But I think I found it pretty good. And I think you guys laid it out really well. I want to talk about asset protection. I think we mentioned that. So briefly touch on just the payoff here for somebody who again bought that apartment complex borrowed from the policy, asset protection why do it guys, why not just put the million dollars down? What is asset protection going to give me here?

Anthony:

Well, again, each state has different, and unfortunately, California is probably one of the least protected states which I’m sure is no surprise to you. But in a lot of states like Nevada, where we’re at Texas, Florida, a lot of states, whatever money you have in cash value is protected from lawsuits and creditors. So like when we were talking about why the advantages to the wealthy are they can put the money in a policy, and it’s protected from creditors. It’s growing at a decent rate of return. It’s tax-free. And it’s also liquid. Because here’s the key like you’re using this example with real estate. Well, we’re trying to tell people is what is that this isn’t an asset. We’re not saying put your money in life insurance, or real estate, or your business or the market. This is an and let’s put the money in the policy, and real estate and the business. Okay, so we just want to entice what you’re doing. A lot of your clients are doing very well with their investments. And we’re the last thing we want to do is disturb that. But by running things through the policy, just like a rewards credit card, what they’re going to get is that uninterrupted compound interest, and we’re actually creating some tax deductions.

Brett:

Okay, so I own the property, literally, with the downpayment that came from the trust I borrowed against it, is there an asset protection part of this that I’m more protected now than I was if I just bought the property with my own cash.

Cameron:

Yeah, there is. So here’s, here’s the scenario. So if you go and you fund a policy, you take a loan against it for around a million dollars, and you go and purchase that what you’ve created when you take a loan against your cash values, essentially created a lien against that cash value with the insurance company. So if there’s ever an exit or anything else from your property, but there happens to be a lawsuit against you prior to you exiting that. There was a lien established back when you took a loan against that cash value, right. So when you sell that property, you can then replenish that loan with the pot with the insurance company. So essentially, what you’re doing is you’re creating kind of a bucket that you can put a million dollars back into, even if things go sideways, there’s a lawsuit, there’s a judgment, something like that, right. So and that’s not uncommon. It’s just a characteristic that’s found in this strategy. But it’s found in many others. You see that with pensions and those things with celebrities, you hear about that stuff all the time.

Brett:

Got it. Perfect. So that’s, that’s great. You guys did a great job explaining that. Again, infinitewealthconsultants.com. Anthony Faso and Cameron Christiansen, they’re in Las Vegas, and they can help you with infinite banking. So let’s shift a little bit here. So I’m going to talk about capital gains tax deferral a little bit. So one of the things we’re trying to help people is have solutions for capital gains tax or some curious guys, what’s the biggest frustration when it comes to capital gains tax deferral options, you could talk about the 1031, you could talk about other things, but what’s the biggest frustration you guys see for yourself or your clients?

Anthony:

I mean, without using some of the strategies you’re incorporating, the biggest one is paying the tax. Even though I will say capital gains are fairly low right now.

Brett:

What do you buy low? California is 13.3. We got a Medicare tax of about 3.8. We got federal at 20. And that’s about 37% not counting depreciation, recapture what could be as Upper 40 or 45? Or 50? So can you define low for us?

Anthony:

Well, okay, I would say that there are different tax rates, ordinary, and capital gains are always going to be lower than your ordinary income. So I’m referring to ordinary income versus capital gains.

Brett:

Fair enough.

Anthony:

Nobody wants to pay the tax, especially they’ve built to probably put their blood sweat, and tears in this business, or they risk making this investment, and then the half to pay some of these profits to the government is by far the biggest pain. And the 1031 has some advantages, but all we’re doing is kicking the can down the road. Right? We’re just deferring them. So kinda like with what you’re doing as you’re helping get rid of them, which would be much better than paying them. I would say.

Brett:

What’s your biggest frustration with the 1031 exchange?

Anthony:

For me, I’m hesitant to defer taxes to a rate that I don’t know what is going to be. I mean, there’s been a lot of talk with the capital gains rate being Increased, particularly over people, I just read the paper today. Biden’s floating around the idea of people make more than a million dollars. That I don’t know if that they’re gonna have a higher capital gains rate. I don’t know exactly what he’s trying to do. But he’s trying to get rid of some of the advantages of the capital gains rate. So if that passes, and you defer it to 1031 to a couple of years from now, you could actually be paying more tax.

Brett:

Take some boot or you find cash out, go ahead. Go ahead, Cameron.

Cameron:

No, I was just gonna try to take kind of a big broad picture. This is nobody likes paying taxes. Right? So really, there are four or five different ways that you can kind of what do we call tax avoidance, whether it’s deferral, it’s deductions, it’s the elimination, it’s kind of offsetting some of this stuff to different tax brackets, right. And so the space that we play in the anti plan is the permanent tax savings. Right. And so a lot of times, if you have a big sale of a highly appreciated asset, you look at a charitable remainder trust, or you looking for a deferred sales trust that you recommend are very well versed in. Right, if you have a highly appreciated asset, maybe that makes sense, what we typically do is we want to get somebody over into the permanent tax savings as quickly as possible. And now what you have, what you see is with a lot of deferral strategies, his people don’t have access to those dollars. And so the strategy that we implement is a permanent tax saving where we provide access to those dollars for clients. And what’s different, you kind of mentioned it before you start off by asking kind of what’s important to wealthy clients that it’s important up and down the spectrum, right is, mean what you rewind 15 years ago, 20 years ago, I was the early 20s, I wouldn’t say that I was wealthy, but I had some of the same frustrations. My frustrations were nobody taught me about money, or how to create wealth. And so by giving putting money somewhere where somebody has access to it, is now we can kind of talk to people about how money works. And that’s probably one of the biggest frustrations that I see with our higher-end wealthy clients is that lack of communication on how they how that patriarch or that matriarch created the wealth over their lifetime, is what you see is you see one generation that has been really successful either in business and or real estate, and the next generation doesn’t have a clue on how they did it doesn’t have a clue on how to manage money. And so that’s where we have really kind of set ourselves apart is having those family conversations. And a lot of what we do is probably what I would say falls under more estate planning than really anything else is when you have those conversations, that generational wealth planning, it is all about preservation. So I hope that helps.

Brett:

Yeah, it does, absolutely does. And just so you guys know the deferred sales trust for listeners. What I love about it, is it provides liquidity diversification and the ability to be active or passive. And I like to separate wealth strategies or tax deferral strategies, there’s kind of two buckets, there’s like the transactional ones, I call those like the blockbusters, those are like the Delaware statutory trust. Those are like the charitable remainder trust, those are like the 1031 exchange, they’re, they’re typically pretty limited and pretty focused, they all serve their purpose in different ways. But it’s it doesn’t necessarily always give you liquidity, diversification, and the ability to be active or passive without having to give it all the way to charity with the deferred sales trust. So I think it’s transformational is it kind of gives we called the Swiss Army Knife of tax deferral strategies, you can have liquidity and have diversification. You can be active in real estate, you can be passive in real estate, you can be in stocks, bonds, mutual funds, you can go into hard money lending, I have a client right now who did a $2.6 million sale out of Alabama, and he deferred all this tax, and he’s building 72 units. He’s in his early 40s. And he’s like I don’t want to retire all the way. I also have a really high income. And I want to shift to the second phase of my career, which is multifamily development. So he went from a marketing business background. And now he’s launched his new business, I call it the Go Fund yourself. He used the deferred sales trust partnered with it all tax-deferred to build these units. And on top of that, he’s a very high-income earner. So he’s able to like a 401k, roll the funds on the cash flow back into the trust, and the at the trust level. It’s able to expense what it owes to him. Therefore, it’s typically a zero tax transaction when it’s filing his tax return on his level, he’s lowered his tax bracket because he’s not necessarily taking cash flow from the trust. So all of these things are possible. The question is, are you the listener going to get educated? Check it out? Right? Are you going to get with me Capital Gains Tax Solutions, or Anthony or Cameron and figure out at infinitewealthconsultants.com which banking strategy is a good fit for you, I encourage you to do that. All that being said, Guys, we’re running out of time. Are you ready for the lightning round?

Anthony:

Let’s go.

Cameron:

Yeah, fire away.

Brett:

All right. So knowing what you know now If you go back to your 25-year-old self, what’s the one Golden Nugget you tell yourself to do?

Cameron:

Make sure you understand the difference between words, words are important, I would say make sure you understand the difference between saving, investing, and speculating. In our industry, those three words are interchanged, every single day, and they mean they are drastically different. And so that’s where I would start with the young 20-year-old.

Anthony:

For me, I would focus on getting educated. I don’t mean taking college courses. But I mean, working with the mentor, learning about business learning about passive income, not focusing on the money I’m making. But the sense of common sense that I’m earning, and that will pay much bigger dividends in the future than any paycheck in my 20s.

Brett:

Beautiful. Second question, what’s the number one book you recommend that the most are gifted in the past year?

Cameron:

I’m going to recommend Become Your Own Banker. It wasn’t in the last year. But I’m going to stretch that timeline a little bit, go back 12 years. And I’ll tell you what, that’s the second most influential book that I ever read second to the Bible. And I think I’ve tried to read it every single month since then.

Anthony:

What I’ve been recommending this year is called The 12 Week Year. And it’s a whole different philosophy. Instead of doing annualized goal setting, you kind of basically crunch a year down into 12 weeks. And the reason being a year is too long, you might hit a goal or miss a goal in the first quarter. And maybe you’re not going to be as efficient. But as you know, when you have that deadline, that’s when you’re going to become the most efficient. And that 12 week year helps you focus on the important things.

Brett:

Beautiful. Become Your Own Banker. Question three, what are you curious about right now?

Cameron:

I’m curious what this economy is going to look like in the next 12 months. I’m putting myself in a cash position to look for distressed opportunities. And so I’m curious as to where it’s gonna go.

Anthony:

I’m curious, how long the government is gonna continue to prop up the economy.

Brett:

As for my guys, this is very interesting to see. Question four, what’s the biggest obstacle your business is currently facing?

Cameron:

The biggest obstacle that we’re currently facing is education. Clients need to hear a message. People need to hear a message, if I’m totally honest, is because underlying what people do is they have this gut feeling that everything’s not right. Right, everybody’s going to work they’re putting money in their 401k in their IRAs, and the vast majority of people are subject to market volatility. And they just don’t know of any other options. And if you go in there, and you look at how kind of typically qualified plans, the history of them, and where they came about, they weren’t designed to be somebody’s sole retirement vehicle was an accessory to high executives kind of bonus at the end of the year. And now it’s kind of moved over into position a, what we’re doing is we’re giving people options with more control and less risk.

Anthony:

I’m going to expand on that with more of a personal obstacle that we are having. When COVID first hit Cameron, I was a little unsure how I was going to affect our business, to be honest. But we actually had our best year last year. And I think it’s been when people when there are uncertain times people are looking for certainty. So we’re balancing with we’re getting clients coming in, but we also want to produce more content. So kind of like what a lot of business owners will have is that transition of still being able to provide the good service but want to go out there and, and create more content, it’s kind of hard to delegate some of that stuff. So that’s probably the biggest obstacle.

Brett:

You guys have been amazing. We are out of time for our listeners who want to get in touch with you guys, remind them one more time, what’s the best place for them to connect with you?

Cameron:

Actually, I’m going to give you two places infinitewealthconsultants.com and then Brett as I mentioned before is we’ve actually created or because as a thank you for having us here. We’re going to give your listeners access to a free online course. And so we’ve created a page for you guys. It’s called infinitewealthconsultants.com/cresecrets. And so if you guys go in there, we’re gonna open up kind of our course to you guys. So you can dive in. We’ve got a whole bunch of information we dive into the numbers like Brett was asking us about and so there’s more of that in there with some more conceptual stuff just to educate you guys.

Anthony:

You know, I would like to correct Cameron for one. That’s one of my joys in life, is cracking Cameron. It’s not a free course, we actually charge 600 bucks for it. But if you use this link because you’re a listener, thank you, you can get free access.

Brett:

And by the way, if you guys don’t know, expert CRE Secrets is my second podcast. We’re also streaming expert CRE secrets for our YouTube and our second podcast right now as well. Some guests we do dual shows here. So if you’re listening on one or the other, sometimes the same because it is exactly launching at the same time. That being said, I think I want to thank you for being on the show. Thank you for sharing your part of your story, your passion, your niche focus on Infinite Banking, and helping people create and preserve more wealth. I want to encourage you to keep using the gifts and talents you’ve been given to be a blessing to others. And I also want to thank our listeners for listening to another episode of the Capital Gains Tax Solutions Podcast. As always, we believe most high net worth individuals and those who help them they struggle with clarifying their capital gains tax deferral options, not having a clear plan is the enemy and using a proven tax deferral strategy such as the deferred sales trust, or perhaps getting with Anthony Faso or Cameron Christiansen to build an infinite wealth-based insurance plan for you could be the best way to grow your wealth. Please go to capitalgainstaxsolutions.com if we could be of any service to you. By the way. Remember the Deferred Sales Trust works for primary homes, it works for investment, real estate, it works for cryptocurrency, it works for captive insurance, works for anything that basically highly appreciates it, we can defer your tax. And by the way, you can use it to purchase insurance policies. Would you imagine that? Pretty cool, right. I appreciate you listening to the show, and we hope to connect with you again real soon. Thanks, everybody. Bye

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About Anthony Faso and Cameron Christiansen

Anthony Faso and Cameron Christiansen are two gentlemen who have a passion for helping people create and preserve more wealth. They are consultants and hosts of the Infinite Wealth Podcast, and they’re also the Founders of Infinite Wealth Consultants. They are from Las Vegas. One of them has served in the US Army and is a self-describing recovering CPA.

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