In this episode, your Cash Flow Consultant discusses Debt Elimination Banking Tools. These debt weapons allow you to eliminate debt fast!
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Thanks for watching!
Hi folks. Welcome to Oregon Cash Flow Pro. I am your cash flow consultant, James Barber, and I’m here to help you take control of your finances.
In today’s episode, we’re going to be talking about how to beat the bank, with Dynamic Banking.
Dynamic is a process or system characterized by constant change, activity, or progress. That’s what characterizes how we use the banking system. We need our money to work for us constantly, not sitting in a checking or savings account, earning nothing and just benefiting the bank.
So, Dynamic Banking is a process that maximizes your cash flow to eliminate debt, grow assets, and stockpile reserves.
Now, with traditional banking, as you can see, any cash flow that you have, you can either put it towards debt or you can put it towards savings. If you put it towards savings, you’re going to keep paying on the debts and you’re going to end up paying the maximum in interest charges. If you decide to put all of your extra cash flow into savings, you aren’t doing yourself any favors at paying down your debts.
On the flip side, if you put all of your cash flow towards paying down debt, if you come upon an unexpected emergency, you’re not going to have access to that money in order to stay out of trouble.
With Dynamic Banking, we get the best of both worlds. We save for emergencies and we’re paying down the debt. How does that work? Utilizing lines of credit. With lines of credit you’re paying down a debt, but it’s a revolving account. You still have access to all of that credit that you paid down. So if you come across an emergency and you can’t cover it with a credit card, you have to write a check, you can do that out of your line of credit.
Business owners and investors can use Dynamic Banking to rapidly improve their cash flow, acquisition pace, emergency preparedness, debt to income ratios, total debt load, and interest costs.
Now, how do we beat the bank?
It’s a three step process. First, you’ve got to optimize your credit profile. Two, we’re going to leverage that credit to access capital, by way of lines of credit. And three, we’re going to use what we call Debt Elimination Banking Tools (D.E.B.T.) to maximize your cash flow.
So, with Dynamic Banking, we flow all of your income, all of the money you get in a month, through the debt elimination banking tools. We do not want your cash to sit idle in a checking or savings account, ok?
So, here’s what it looks like. Dynamic Banking with a home equity line of credit. You’ve got your income. Normally it might go to a savings account or a checking account, or it might go right to debt. We’re not going to do that. We’re going to put your income right into the home equity line of credit. And from there we’re going to deploy it into investments, emergency funds, vacations, life insurance policies, cash value life insurance policies, and retirement accounts. And your debt of course.
So, we can do everything with a HELOC that we could with a checking account.
Now, let’s talk about the Debt Elimination Banking Tools and see how those work. Those are the keys to success with Dynamic Banking. Remember, we first talked about optimizing your credit. If your credit is not good, you may not have access to unsecured lines of credit and that’s ok. We can still make this work. You can get secured lines of credit.
Credit cards, those can be secured or unsecured. Ideally, we want them to be unsecured. So, your consumer credit cards, if you start off with secured, we’re going to improve your credit and ultimately get you some unsecured. Those usually offer the best rates and the best rewards.
Secured personal lines of credit, same thing, you don’t want to tie up your assets by pledging them to a bank, so we want to work towards getting unsecured personal lines of credit, unless it’s a home equity line of credit.
Home equity line of credit typically offers you the lowest rates available. So, home equity line of credit is a secured one but that’s an ok secured line of credit. You tend to get the most access to the highest balances and it can help you knock out debt really quickly.
Cash value life insurance can be used. It’s not quite as liquid as a line of credit, but it has it’s purposes. That’s cash value life insurance and retirement accounts, both of those, can be used, they’re just not revolving accounts and so we have to use them in a different way. That’s something we’ll discuss in another video.
If you have a business, you have access to business credit cards and business lines of credit. If you have the choice between using business credit cards and business lines of credit and personal, go with the business. It doesn’t show up on your credit report. As long as your credit is ok and you’re not trying to rebuild your credit, utilizing your business credit cards and your business lines of credit is optimal, because it won’t show up on your credit report. It doesn’t matter what your balances are, it’s not going to hurt your credit scores and it won’t hurt whatever you’re trying to do in your personal life. When anybody has to check your credit, these don’t show up there.
So, these are your debt elimination banking tools. Home equity line of credit is the gold standard. Cash value life insurance and retirement accounts can work in conjunction with that to help you grow your wealth. You can also use them to eliminate some debts. But those are more for grow your wealth.
These up here, credit cards, lines of credit, those are attack your debt assets.
Thanks for watching! Stay tuned. The next video will go over a specific scenario using Dynamic Banking and attacking some credit card debt, auto loan, and a mortgage. Let’s see how quickly we can pay those down. Be sure to like the video down below and subscribe to our channel, and we will see you soon!