Here’s one thing Walt Disney, J. C. Penney, Ray Kroc, and the Pampered Chef have in common – they all used cash value from their life insurance policies to start, grow, or support their businesses.

Walt Disney borrowed against his cash value life insurance in 1953 to help fund Disneyland, his first theme park, when no banker would lend him the money. Permanent life insurance policies that grow cash value can function as a private funding source. No qualifying required!

Following the 1929 stock market crash, famous retailer J. C. Penney used his life insurance policies as collateral to help meet the company payroll. Had he not had ready access to capital, the company may have been forced to close its doors, adding even more people to the unemployment line.

When Ray Kroc was building McDonalds, Kroc did not take a salary during his first 8 years, and to overcome constant cash-flow problems he borrowed money from two cash value life insurance policies (and also his bank) to help cover the salaries of key employees. He also used some of the money to create an advertising campaign around emerging mascot Ronald McDonald. We all know how that story ended.

In 2002, Doris Christopher sold her kitchen tool company, the Pampered Chef to Warren Buffett for a reported $1.5 billion. In 1980 she launched the company out of her home with a $3000 life insurance policy loan.

Foster Farms was founded in 1939 when Max and Verda Foster borrowed $1,000 against their life insurance policy to buy an 80-acre farm near Modesto, CA.

Senator John McCain secured initial campaign financing for his presidential bid by using his life insurance policy as collateral. Just goes to show you can choose to use your policy as collateral for whatever reason, good or bad.

Permanent or cash value life insurance, whether Whole Life or Index Universal Life builds up cash value that policy owners can use in difficult times as a readily available source of cash to cover personal or business expenses for emergencies, opportunities, and even to cover insurance costs.

Do you agree it is a good idea to consider a financial vehicle that provides access to cash without penalty? It is certainly worth a conversation. Contact us to discuss.