Kim Butler has 20 Whole Life Policies to Build Wealth

I’ve known Kim Butler for years in person and through our Office Hours sessions. She’s one of the top thinkers in finance and a close friend of Caleb Guilliams. While many people offer financial advice, Kim is an actual practitioner who practices what she preaches—she has 20 life insurance policies! Through her company, Prosperity Thinkers, Kim helps people manage their personal finances from her home in Mount Enterprise, Texas, serving clients in all 50 states.

Kim adopted the ‘Dollar a Day’ strategy for her personal brand to extend her reach on Facebook. By investing a dollar a day, she’s connected with a broader audience, sharing her experience on personal finance and wealth-building.

At first, I thought Prosperity Thinkers was connected to the prosperity gospel. Turns out, it’s all about whole life insurance and infinite banking.

The Basics of Life Insurance

If you’re not familiar with infinite banking, it’s a strategy that uses whole life insurance policies as a savings and borrowing vehicle.

Many folks think life insurance is something you only need later in life. Most don’t know the difference between term life and whole life insurance, assuming term is the “regular” kind. But life insurance comes in two main forms:

• Term Life Insurance: Often viewed as “regular” life insurance; it’s like renting a house. It’s straightforward—you receive a tax-free death benefit if the insured passes away during the term. By the time you’re 18, having some term life insurance can be advantageous, especially if you have financial obligations like car loans or student debt.
• Whole Life Insurance: This is where the strategy of infinite banking comes into play. Whole life insurance is offered by companies in the mutual life insurance industry, like Guardian, New York Life, Northwestern Mutual, Mass Mutual, and about 15 others in the U.S.

How Powerful is Whole Life Insurance?

Many of my entrepreneur friends have told me, “Dennis, I set up a whole life policy through Caleb or Kim.” I wondered, “Why are so many wealthy families and entrepreneurs using their whole life policies as their bank?”

Because whole life insurance is a centuries-old product that simply works. Wealthy families often purchase life insurance policies when a baby is born, creating an immediate trust. That trust holds stock in the family-owned company, something these families have done for generations.

On day one, that baby is already valued at millions, qualifying for life insurance based on their human life value. When a grandparent passes, their life insurance—tax-free—pays into the estate, replacing that generation’s wealth. This cycle repeats, allowing each generation to spend freely while ensuring the wealth is replenished for the next.

A common misconception is that you need a lot of money to set up your own infinite bank or a whole life insurance policy. But that’s not the case. The great thing about life insurance is that it can be paid monthly or annually, so you don’t need a huge amount of money upfront.

Kim has worked with young adults aged 18 to 20 who have good summer jobs, making $50k a year. They start by putting away as little as $100 to $500 a month to build their first life insurance policy. As your income rises, you can save more—the key is to start early and be consistent.

The Doctor Who Recovered from a Hurricane Using Whole Life Insurance

Twenty years ago, a man in his early 30s—a doctor—bought a lot of real estate in Florida and also took out a whole life insurance policy with Kim’s guidance. Things were going well until a hurricane hit Florida, wiping out much of his real estate investment. While he had insurance on the properties, it didn’t cover everything.

To keep things afloat, he borrowed against the cash value of his life insurance to cover expenses. This happened during the third year of his policy. Over the next couple of years, he managed to rebuild his real estate portfolio, thanks in part to the liquidity provided by his whole life policy.

With his cash flow restored, he used the income from his properties to pay back the loan against his policy. During all this time, the cash value of his life insurance continued to grow, unaffected by the loan. Whole life insurance works similarly to real estate: you have an asset, and you can borrow against it, but the asset itself keeps growing.

Looking ahead, he plans to combine his real estate and life insurance benefits using a charitable remainder trust. This will allow him to sell his properties without paying capital gains taxes, a powerful strategy for preserving wealth.

Folks often talk about using the cash value of their whole life insurance while they’re alive, and it’s a great tool for emergencies or opportunities. However, when combined with other assets like real estate, the death benefit becomes even more valuable. It’s not just something to consider when you’re in your 80s or 90s—the real magic happens when you plan ahead and use both the cash value and death benefit to your advantage.

Kim Butler’s expertise in this area is invaluable, and I’m grateful to have people like her in my life. If you’re interested in learning more about how to build wealth using whole-life insurance and infinite banking, I highly recommend reaching out to Kim or exploring her resources at Prosperitythinkers.com.