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The Insured Portfolio: Your Gateway to Stress-Free Global Investments

Book Description

How to safely, easily, and as tax efficiently as possible diversify and hedge against the dollar's fall

It's no secret-the U.S. economy is in crisis mode, threatening everything from personal savings to our overall prosperity as a nation. Panicking is not the answer. Having a clear game plan is. In this environment, investors must protect themselves from the immense financial uncertainties they face as a saver or an investor in the 21st Century. Investors need solid information about ways to recession-proof their retirement and investment portfolios.

The Insured Portfolio offers that guidance revealing the major financial threats the 21st Century Saver and Investor faces and showing them how to build a strong portfolio and protect their assets. Written in smart, engaging prose, the book:

  • Details ways to invest overseas, and specifically-how to use international private placement policies as a way to protect assets and reduce taxes

  • Provides investors with the tips and tools needed to profit overseas with insurance, including how to bypass the international restrictions often used to keep investors from seeking opportunities in other countries

For those seeking customized asset protection, a dollar hedge, global investment diversification, tax privileged growth and estate planning, there is not another single solution on the market today that can achieve all of these objectives at once better than The Insured Portfolio.

Table of Contents

  1. Copyright
  2. DISCLAIMER
  3. ACKNOWLEDGMENTS
  4. INTRODUCTION: A NEW GENERATION OF SAVERS AND INVESTORS HAVE BROUGHT CERTAINTY TO THEIR FINANCIAL FUTURE—AND SO CAN YOU!
    1. FIGHT OR FLIGHT—THE COURAGE TO SEE BEYOND
  5. 1. WELCOME TO THE TWENTY-FIRST CENTURY: The Lessons of the First Decade and the Historical Precedent for Today's "Unprecedented" Crisis
    1. 1.1. HISTORY MAY NOT REPEAT ...
    2. 1.2. WHY THE EVENTS OF 1873 REALLY MATTER
    3. 1.3. AMERICA'S AGE AS A SUPERPOWER
    4. 1.4. THE GENERATIONAL WEALTH PHENOMENON
    5. 1.5. THE FIRST GENERATION: PRIOR TO THE 1920s—LIVING THE AMERICAN DREAM
    6. 1.6. THE SECOND GENERATION: 1920s–1970s—KILLING THE GOLDEN GOOSE
      1. 1.6.1. Out of Crisis: A New Breed of Leader
      2. 1.6.2. Short-Term Solutions that Never Went Away
      3. 1.6.3. The Social Insurance Snowball—Sold as the Answer to Poverty
      4. 1.6.4. Keeping up with the Joneses
      5. 1.6.5. Government Growth Spreads to the Judicial System
      6. 1.6.6. Tort Law is Born
    7. 1.7. THIRD GENERATION: 1970S–TODAY—PAYING THE PIPER IS OFTEN HARD
      1. 1.7.1. Total Amount of Federal Spending per Family: More Spending = More Inflation
      2. 1.7.2. Mortgaging America's Future (and the Future of Your Wealth)
      3. 1.7.3. A "Debt-aholic" Government
      4. 1.7.4. National Debt Exploded in the Past 20 Years
    8. 1.8. NEARING THE BOILING POINT
    9. 1.9. WITH CRISIS COMES OPPORTUNITY
    10. 1.10. FINDING THE NEW LAND OF OPPORTUNITY AND SAFETY
  6. 2. PASSING THE WEALTH BATON: Building a Sustainable Investment and Savings Plan to Ensure a Solid Financial Future
    1. 2.1. STEP 1: FOR WORLD-CLASS INVESTMENT RETURNS, YOU NEED WORLD-CLASS INVESTMENTS—THE IMPORTANCE OF GLOBAL MARKETS IN THE TWENTY-FIRST CENTURY
      1. 2.1.1. The "American" Dream Finds a New Home
      2. 2.1.2. The American Dream: Gone Global
      3. 2.1.3. Globalizing the Economy—Americanizing at Home
      4. 2.1.4. The Key to Understanding Economies in the Long Haul
      5. 2.1.5. Profiting from the "New" First Generation
      6. 2.1.6. Why IRAs and 401(k)s Simply Are Not Enough
      7. 2.1.7. Understanding the U.S. Tax Requirements is Critical
    2. 2.2. STEP 2: PROTECT YOURSELF FROM THE ERODING U.S. DOLLAR
      1. 2.2.1. Dollar Holders Locked Inside a Sinking Ship
      2. 2.2.2. The Birth of a Worldwide Fiat Money System
      3. 2.2.3. The Brave New World—Creating Money without Value
      4. 2.2.4. What Drives Currencies
      5. 2.2.5. An Eternal Bull Market
      6. 2.2.6. Hedge against Market Risk
      7. 2.2.7. Greater Profits from Traditional Investments
      8. 2.2.8. Dollar Holders Are Way Behind the Currency Times
      9. 2.2.9. Currency Investments for the Twenty-First Century Portfolio1
        1. 2.2.9.1. Australian Dollar (AUD or A$) Central Bank: Reserve Bank of Australia (RBA)2
        2. 2.2.9.2. Brazilian Real (R$ or BRL)Central Bank: Central Bank of Brazil3
        3. 2.2.9.3. British Pound (GBP or £)Central Bank: Bank of England (BoE)4
        4. 2.2.9.4. Canadian Dollar (CAD or C$)Central Bank: Bank of Canada (BOC)5
        5. 2.2.9.5. Chinese Renminbi (RMB) or Yuan (CNY)Central Bank: People's Bank of China (PBC or PBOC)6
        6. 2.2.9.6. Czech Koruna (CZK or Kč) Central Bank: Czech National Bank7
        7. 2.2.9.7. Danish krone (DKK or Kr) Central Bank: National Bank of Denmark8
        8. 2.2.9.8. Euro (EUR or £) Central Bank: European Central Bank (ECB)9
        9. 2.2.9.9. Hong Kong Dollar (HKD or HK$) Central Bank: Hong Kong Monetary Authority10
        10. 2.2.9.10. Hungarian Forint (HUF or Ft) Central Bank: Hungarian National Bank11
        11. 2.2.9.11. Icelandic Krona (ISK or Ikr) Central Bank: Central Bank of Iceland12
        12. 2.2.9.12. Indian Rupee (INR or Rs) Central Bank: Reserve Bank of India (RBI)13
        13. 2.2.9.13. Japanese Yen (JPY or ¥) Central Bank: Bank of Japan (BoJ)14
        14. 2.2.9.14. Mexican Peso (MXN or Mex$) Central Bank: Bank of Mexico15
        15. 2.2.9.15. New Zealand Dollar (NZD NZ$ or Kiwi) Central Bank: Reserve Bank of New Zealand16
        16. 2.2.9.16. Norwegian Krone (NOK or kr)Central Bank: Bank of Norway17
        17. 2.2.9.17. Polish Zloty (PLN or zl) Central Bank: National Bank of Poland (NBP)18
        18. 2.2.9.18. Singapore Dollar (SGD or S$) Central Bank: Monetary Authority of Singapore19
        19. 2.2.9.19. South African Rand (ZAR or R) Central Bank: South African Reserve Bank20
        20. 2.2.9.20. Swedish Krona (SEK, Swedish Crown or kr) Central Bank: Sveriges Riksbank21
        21. 2.2.9.21. Swiss Franc (CHF, Fr, or SFr) Central Bank: Swiss National Bank (SNB)22
        22. 2.2.9.22. U.S. Dollar (USD) Central Bank: Federal Reserve23
      10. 2.2.10. Moving Your Wealth Out of One Basket
    3. 2.3. STEP 3: LOWER YOUR WEALTH PROFILE AND PROTECT WHAT YOU HAVE
      1. 2.3.1. Frivolous Lawsuits Abound with No End in Sight
      2. 2.3.2. Entrepreneurs and Professionals Are at the Biggest Risk
      3. 2.3.3. Divorce Is a Major Threat to Nearly 50 Percent of Today's Families
      4. 2.3.4. Identity Theft Is Also on the Rise
      5. 2.3.5. No State or Federal Protection
      6. 2.3.6. Your Primary Residence
      7. 2.3.7. Protection Limits Can Greatly Diminish Your Security
      8. 2.3.8. Your Retirement Nest Egg
      9. 2.3.9. For True Protection, Give Your Money Away
        1. 2.3.9.1. Asset Protection Trusts
        2. 2.3.9.2. Family Limited Partnerships
        3. 2.3.9.3. Limited Liability Companies
      10. 2.3.10. Timing Is Everything—Avoid Fraudulent Conveyance
    4. 2.4. STEP 4: CREATE A PLAN TO PROVIDE FOR YOUR LOVED ONES
      1. 2.4.1. Getting Started on Your Estate Plan
      2. 2.4.2. The Importance of Having a Will
        1. 2.4.2.1. A Living Trust Skips the Probate Process
        2. 2.4.2.2. Life Insurance—A Good Tool for Estate Planning
    5. 2.5. THE SOLUTION? WORK TWICE AS SMART, AND MAKE YOUR MONEY WORK TWICE AS HARD
  7. 3. AN AGE-OLD SOLUTION TO INSURE YOUR PORTFOLIO: Meeting All the Requirements of the Real World
    1. 3.1. MEET THE HUMBLE ANNUITY—THE MOST WELL-KNOWN PRIVATE PLACEMENT POLICY
    2. 3.2. THE EVOLUTION OF ANNUITIES IN THE UNITED STATES
    3. 3.3. THE BIRTH OF THE VARIABLE ANNUITY
    4. 3.4. DOMESTIC ANNUITIES EXPLODE ONTO THE AMERICAN MARKET
    5. 3.5. THE MECHANICS OF PRIVATE PLACEMENT POLICIES
    6. 3.6. SAVVY AMERICANS DEVELOP A LOVE FOR FOREIGN ANNUITIES
    7. 3.7. WHY FOREIGN PRIVATE PLACEMENT POLICIES ARE THE BEST SOLUTION
    8. 3.8. THE KEY TO A GOLD MINE OF INVESTMENT AND CURRENCY DIVERSIFICATION
    9. 3.9. ONE OF YOUR LAST OPPORTUNITIES FOR TAX-DEFERRED GROWTH
    10. 3.10. 100 PERCENT FLEXIBLE . . . 100 PERCENT OF THE TIME
    11. 3.11. UNMATCHED INVESTOR PROTECTION
    12. 3.12. UNDER LOCK AND KEY
    13. 3.13. NO SECRECY BUT SUPERIOR PRIVACY
    14. 3.14. PEACE OF MIND FOR GENERATIONS
    15. 3.15. TRANSPARENCY OF FEES AND EXPENSES
    16. 3.16. FROM MEAGER BEGINNINGS, THE MODERN INSURANCE POLICY THRIVES
  8. 4. FINDING THE RIGHT POLICY TO MEET YOUR FINANCIAL GOALS AND SECURE YOUR PEACE OF MIND
    1. 4.1. THE TOP THREE SOLUTIONS FOR TWENTY-FIRST-CENTURY INVESTORS
    2. 4.2. POLICY 1: THE DEFERRED VARIABLE ANNUITY
      1. 4.2.1. The Simple Setup of the DVA
      2. 4.2.2. Additional Protection for Heirs after You're Gone
      3. 4.2.3. The Finer Points of the Offshore Variable Annuity
      4. 4.2.4. Understanding U.S. Tax and Reporting Requirements
        1. 4.2.4.1. Main Rules for Tax Deferral
      5. 4.2.5. Annual U.S. Reporting Requirements for the Annuity Policy
        1. 4.2.5.1. Case Study: Deferred Variable Annuity—Jerry the Bachelor Gives a Helping Hand to Mom
    3. 4.3. POLICY 2: THE VARIABLE UNIVERSAL LIFE POLICY
      1. 4.3.1. The Simple Setup of the VUL
      2. 4.3.2. The Finer Points of the VUL
        1. 4.3.2.1. Case Study: A VUL MEC—Alfred Needs Cash to Help his Daughter Cover Future Estate Taxes
        2. 4.3.2.2. Case Study: A VUL Non-MEC—John Wants to Pass Wealth to His Children but Needs Flexibility in Funding His Policy
      3. 4.3.3. Understanding the Tax and Reporting Requirements
    4. 4.4. POLICY 3: THE FROZEN CASH VALUE POLICY
      1. 4.4.1. The Simple Setup of an FCV
        1. 4.4.1.1. Case Study: An FCV—Elizabeth Wants to Leave a Legacy for Her Grandson and Nieces
      2. 4.4.2. Understanding the Tax and Reporting Requirements
    5. 4.5. INSURANCE POLICIES—THE GATEWAY TO STRESS-FREE GLOBAL INVESTMENTS
  9. 5. THE IMPORTANCE OF A JURISDICTION FOR YOUR INSURED PORTFOLIO—PLUS OUR TOP RECOMMENDATIONS
    1. 5.1. LEVEL I JURISDICTIONS: THE MOST STABLE AND MOST PROVEN
      1. 5.1.1. Switzerland: The Historic Home of Wealth and Tradition
        1. 5.1.1.1. History and Overview
        2. 5.1.1.2. Switzerland "Once Upon a Time"
      2. 5.1.2. Liechtenstein: The Little-Known Nation Offers a Strong Alternative to Switzerland
        1. 5.1.2.1. History and Overview
      3. 5.1.3. Growing as an Important Part of Europe
        1. 5.1.3.1. Liechtenstein: The World's Gateway to International Markets
        2. 5.1.3.2. Concrete Benefits in This Tiny Principality
      4. 5.1.4. Isle of Man: Freedom to Flourish and the Creativity to Make It Happen
        1. 5.1.4.1. Tynwald and Freedom to Flourish
        2. 5.1.4.2. Some Obstacles for Annuities and Other Policies
      5. 5.1.5. Luxembourg: In the Heart of Europe, a Thriving Financial Center Was Born
        1. 5.1.5.1. Banking and Business Haven
    2. 5.2. LEVEL II JURISDICTIONS: NOT AS STRONG, EQUALLY STABLE—SECONDARY CANDIDATES
      1. 5.2.1. The Republic of Ireland
      2. 5.2.2. The Cayman Islands
      3. 5.2.3. Singapore
      4. 5.2.4. Nevis
      5. 5.2.5. Bermuda
    3. 5.3. LEVEL III JURISDICTIONS: UP-AND-COMING HAVENS AND THOSE WITH FLAWS
      1. 5.3.1. Brunei—The Tiny Jewel of Southeast Asia
      2. 5.3.2. Seychelles—Up and Coming
      3. 5.3.3. The Bahamas—Changes Make it Unattractive
    4. 5.4. THE SECOND PART OF THE EQUATION: SELECTING THE RIGHT COMPANY
      1. 5.4.1. How to Know Where to Start
  10. 6. HEADING OUT INTO THE UNKNOWN WITH CONFIDENCE
    1. 6.1. AN UNCOMMON SOLUTION ON THE ROAD LESS TRAVELED
    2. 6.2. OUR TOP THREE PICKS
    3. 6.3. EXCHANGING YOUR CURRENT U.S. INSURANCE POLICY FOR ONE OFFSHORE
    4. 6.4. POLICIES MAY BE COMBINED WITH OTHER TYPES OF STRUCTURES FOR BETTER ESTATE PLANNING AND MORE CUSTOM SOLUTIONS
      1. 6.4.1. Case Study: A Policy Combined with a Trust—The Stetsons' Wish to Leave a Legacy
      2. 6.4.2. Policies can also Be Combined with Life Insurance Trusts
    5. 6.5. YOUR ROAD MAP ON WHERE TO GO FROM HERE
    6. 6.6. ONE FINAL BIT OF ADVICE . . .
  11. A. EXAMPLES OF HOW PRIVATE PLACEMENT POLICIES MAY BE USED: Case Studies
    1. A.1. CASE STUDY 1: RUSSELL—YEARS IN THE ICE CREAM BUSINESS PAYS OFF
    2. A.2. CASE STUDY 2: MICHAEL AND SHEILA—THE YOUNG MILLIONAIRES
    3. A.3. CASE STUDY 3: JOHN AND MARTHA—THE SAILING COUPLE
    4. A.4. CASE STUDY 4: AARON AND HIS EX-WIFE
  12. B. FURTHER RESOURCES AND READING
    1. B-1: SECTION 7. PASSIVE FOREIGN INVESTMENT COMPANIES
      1. B.1.1. .01 In General
      2. B.1.2. .02 Determination of PFIC Status
    2. B-2: IRS SECTION 957—CONTROLLED FOREIGN CORPORATIONS
    3. B-3: EVERBANK CONTACT INFORMATION
    4. B-4: DEPARTMENT OF THE TREASURY—INTERNAL REVENUE SERVICE SECTION 8754
    5. B-5: LIECHTENSTEIN SUPERVISION LAWS
    6. B-6: IRS FORM 720
    7. B-7: FOREIGN INSURANCE EXCISE TAX
      1. B.7.1. Introduction
      2. B.7.2. Policy of Insurance
        1. B.7.2.1. Indemnity Bond
        2. B.7.2.2. Annuity Contract
      3. B.7.3. Insurance of a United States Risk
      4. B.7.4. Policy Issued by a Foreign Insurer or Reinsurer
      5. B.7.5. Liability for Tax
      6. B.7.6. Computation of the Tax Due
    8. B-8: TDF 90-22.1 FORM
    9. B-9: 26 U.S.C. § 7702—US CODE SECTION 7702: LIFE INSURANCE CONTRACT DEFINED
    10. B-10: SEVEN-PAY TEST VUL—NON-MEC
    11. B-11: PREMIUM GUIDELINES
    12. B-12: LIECHTENSTEIN INSURANCE CONTRACT ACT
    13. B-13: US LIECHTENSTEIN TIEA
    14. B-14: IRS SECTION 1035
    15. B-15: 1035 ASSIGNMENT LETTER
  13. NOTES
    1. CHAPTER 2
    2. CHAPTER 3
    3. CHAPTER 4
    4. CHAPTER 5
  14. GLOSSARY
  15. ABOUT THE AUTHORS
    1. ERIKA NOLAN
    2. MARC-ANDRÉ SOLA
    3. SHANNON CROUCH