More on Dysons “Secret 770 Plans”

By | July 22, 2013

…Continued from

Whole life insurance does have the insurance portion, and it’s set up to accumulate your death benefit over time. So if you are looking for a $500,000 policy and the insurance company thinks you’ll die in 30 years. Your premiums and whatever returns the insurance company can earn on those premium payments will have to add up to make $500,000 in that period, plus the insurance company’s profit. And that’s the logic dude.

If you’re thinking about it as insurance — much of your premium should go into building a cash value for the policy. Then your cash balance can multiply nicely, and provide what is effectively a decent investment return that is definitely tax-advantaged.

I really don’t know whether the 5.5% gain Dyson is expecting in this case is usual or not.

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So the crucial part of this, from what I could decipher, is that you want to buy whole life insurance, that you could have a partaking or dividend-paying policy. And perhaps even, if Dyson is following the same track as folks like the “Bank on Yourself” people do, and you want to maximize the amount of savings you put into such plans (more often known as “paid up additions”).

Taking advantage of “be your own bank” stuff is about putting so much of your money into policies that, you do all of your big purchases (like buying cars, etc.) by borrowing from your policy etc. To do that you have to be the type of individual who can set aside a considerable amount of money for these large premiums as your “obligatory savings” plan.

And that makes the whole stuff very confusing, even if you are not calling it a “Secret 770 Plan”, these are complex contracts, and they’re not consistent across different insurance companies. What I can tell you is they’re difficult to compare across providers, and this remains to be a hallmark, of most commission-driven, hidden fee businesses. I am not quite sure how most of these businesses work.

In conclusion I would suggest that most of these products start to make sense only after a long period of painful premium payments say 10 years or more, and this is a small niche of insurance business that’s focused on the uber rich.

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16 thoughts on “More on Dysons “Secret 770 Plans”

  1. MrInsuranceBrokerSF

    I thought that long secret recipe was something I had checked out previously. I listened while I was doing other work, then I went online to check scams. As someone who started selling Life Insurance at age 18, and never wanted to sell people the wrong policy, I quickly came to understand a few things:
    a) Life insurance is not cheap, but it can be a great deal depending on how it’s set up, and when you kick.
    b) The agent’s commissions ranging 75% up to 200% first year premiums are the best in the business, unlike
    Property & Liability commissions from 8% to 15% for most common lines. Incentives are huge: get people
    a product they really need, and make a bundle doing it.
    c) Can you really turn $1,000 into $10,000 in one year? Isn’t that about 1,000% ROI? Well, sure if you count
    on dying so your beneficiary collects the tax free death benefit. I haven’t read anyone comment on the
    biggest catch with any Life policy that accumulates cash values: unless it has a rider to pay your cash plus
    the death benefit, the way they got rich is 1) paying nothing on expired/lapsed policies, and 2) Paying off
    $1,000,000 using $400,000 of your own money. What, you say no – you borrowed out your $400,000, no
    problem says the Life Ins. Co., here’s your check for $600,000 on your $1M policy. There’s literally no free
    lunch. If this was really a secret, and really hurting the IRS collections etc., Congress would have stopped
    it long ago.

    There are certainly specific cases where using Life Insurance can save high income individuals and corporations
    taxes. Those are not secrets used in Key Man Employee, and business buyout plans all the time.

  2. Roy

    I have one of those “blended policy” as they call them with AUL American United Life. Paid in full in 8 years. I am 4 years in it and his guarantee returns has being better that the salesman agent protection.

  3. P Yoder

    If dyson is so willing to see people succeed, then why doesn’t he just come right out and tell what he knows. No, human greed- got to make more money off people some how. If the “770” is so sucessful, why is he still trying to make money off a publication? He should have enough money from his 770 accounts.

  4. Shirley Drummond

    Would you share the name of Insurance companies that offer the 770 plan? Thank you.

  5. Edgar Arceo

    I am a Registered Investment Adviser, and I can tell you exactly what this “770 account” is. I read some reviews and many have the right “product” but very few have the right understanding. So I am going to try to be as concise as possible. So what is a 770 Account?

    While looking at the video/information of the 770 accounts I knew exactly what they were talking about right away, because it is something I do and it is something I recommend to some of my clients based on their needs and their future plans etc – but I am kind of mad at these companies that are putting those accounts (770) like something mystical or hidden. Like finding a pirates’ treasure that nobody knows – it actually put fears on people’s minds sometimes. They use manipulation of people’s emotions to get their interest etc.

    So to answer the question, the “770 accounts” are just “Permanent Life Insurance” with some modifications to it – with special riders that some Mutual Companies offer (not all – you need to be careful) (like Non direct recognition, PUA riders, Dissability, MEC level, etc)
    Now, it is not your typical “Permanent life insurance” that you get normally – like with “All State” etc. You would need to talk with somebody that knows how to convert those permanent life insurance policies into a system that will allow you to “stockpile” money unto your own policy without getting into a MEC (modified endowment contract) – otherwise, the policy will lose the TAX-FREE potential.

    But when use it correctly, your life insurance policy will work like that documentary you probably saw that presidents, big corporations, banks etc use. It will give you a good competitive interest rate, tax free distributions, it’s secure against creditors (in case they sue you etc), it has guarantees, you have liquidity use and control of your money, it grows tax deferred, it will provide you with disability protection and it will let you use your policy as a “banking system” – which many people call it the Infinite Banking Concept.

    I know that when we normally look at Permanent life insurance we put a wall and don’t want to hear more about it– that is probably why that video hides the “life Insurance” word and switched it to “770 accounts” – (a lot of people are very close minded) – more because some “financial gurus” on TV have said that Whole Life insurance is a bad idea etc. And they are right – if you just get the typical Permanent life insurance… then it doesn’t make any sense. (That is what most of the people get when they buy a Permanent Life Insurance – high Death Benefit, ZERO cash value on the first years, and low growth on your cash value. And that is what the normal life insurance agent wants to sell – he gets paid really well when he sells one of these… but if you do it the right way, you cut about 60-70% of the agent’s incentive, because that money will be part of your cash value on year 1.

    If you know an insurance agent and he/she wants you to buy a policy with him/her, feel free to give me their information (as far as the company they are using and the illustration they showed you) and I can give you an unbiased opinion if it is a good idea or not.

    One final thing: it is real – and what that documentary said about presidents, Walt Disney, JC Penny, all banks, etc… is real. I also have documents that prove it. So it is something I recommend a lot as an adviser.

    Edgar I Arceo
    The Arceo Financial Group

  6. Anon

    This does not address the question. The question is “can excess paid in cash value be withdrawn and will and the cash value be treated as a high interest bank account?”

    1. Anum

      You can not withdraw the paid in cash value but borrow against the cash value.
      You can pass on substantial amount of wealth to your next generation with whole life.

  7. tfj

    Spent 7 years as an agent for a major life insurance company so I know a little bit about these products since I sold them. Bear in mind that the commission is front end loaded on these products. As much as 90% of the initial annual premium, sometimes even more, sometimes less. Each company structures their payout a little differently.

    If you look at the projections from the agent, you will notice that accumulations begin very slowly unless you make additional payments up front to cover the front end loaded commissions and expenses. Typically, it takes 10 years or more to get accumulations going.

    Payouts will vary from the initial projections contingent upon market conditions so it is not set in cement like an annuity payout. They can go down or up although the fluctuations are not as volatile as the stock market in whole life policies as opposed to variable life policies which is based on mutual fund like performance. Whole life policies tend to be more stable since they are more conservatively invested. Nevertheless, returns are not normally guaranteed.

    They are not necessarily a “bad” investment but remember their primary intent is to serve as a life insurance policy, not an investment plan. As life insurance goes, they are probably the best plan provided you can continue to make the premium payments.

    As an investment plan, they are not the best deal in the first decade but do conservatively well over time. The real growth comes from making consistent payments over a longer period of time and letting the gains grow in the policy.

    One of the advantages of a whole life plan is that the gains accumulate without taxation in the policy. Tax wise the money is taxable when withdrawn. However, it is a FIFO payout. This means that it is a first in, first out plan or the premiums paid are withdrawn first and not taxable because they were paid from already taxed income. Once the full amount of the premiums paid in are withdrawn the amounts withdrawn then do become taxable at your current level of income.

    If you are looking for life long insurance and can afford the premiums, whole life is a very good plan. As an investment because of the front end commission and expense loading, not so great in the first 10 to 20 years but will grow nicely thereafter with each premium paid and the money accumulates in the policy tax free until withdrawals are made beyond premiums.

    Not a bad plan for a younger person (40 or under). There are better, but then again, there are worse. A conservative investment as long as the company is stable. Life insurance companies do go out of business too.

    Just make sure that you look at all aspects of the plan before purchasing. Oh, and one last thing. Since it is life insurance, there is underwriting based upon your health. If your health is impaired, there will be additional premiums added to cover the additional actuarial risk to the insurance company. The lowest premiums are paid by younger, healthier females who do not smoke since they tend to live longer than males.

    This is based on my assessment of what I have read that this plan is. There may be differences but I think this will cover the basics for whomever is interested in what I believe this plan is based upon.

  8. Dennis Johnson

    I had 3 of these policies starting back in 1982. Hard for a young person to pay even modest premiums but glad I did. I cashed in two policies just before the housing crash & paid my daughters college tuition, room & board in cash for 1 year then tuition for the other 3. It worked out for us as I had the life insurance while we raised a child. Since she’s grown we dont need it now & no student loans. Good return but check with an accountant to decide.
    Good Luck!!!

  9. Mike

    I actually own one of these policiies. The cost of the base insurance is very reasonably price, really not much more than my term policy which went up wauy too mcch when I turned 50. I wish I had done this 20 years ago. I am 54. It takes only 3 years and the total cash values are more than the premimums. 6-7 years and the annual paid up additions will be paid for each year by the cash value interest. I don’t have to make another insurance payment if I choose not to do so.

    I have a policy with a dividend mutual company that has been in business for 150 years. In my contact I have a guaranteed 5% return and an annual dividend between 1.8-3%. (The company has never missed paying out a divident, even during the down times like 2008-09)

    There is no annual management fees of 1-1.5% like my mutual funds and it grows tax free in this vehicle. This is an actual rate of return and not a projected rate of return.

    1. Mark Mata

      Can you send me the name of the company? The Palm Beach Report Letter is saying about the same thing and not mentioning names. If you would, much appreciated.


      Mark Mata


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