When my financial advisor told me to put my excess cash into life insurance, my first reaction was admittedly, to laugh.
But once I’d looked at what he showed me and done the research, I had just one question: “Why aren’t more people doing this?”
When I understood what a remarkable asset whole life insurance is, I was dumbfounded that more people aren’t taking advantage of it.
The first and biggest obstacle preventing more widespread use of life insurance policies is simply put, a lack of education. People don’t understand what they’re dealing with; when they hear “life insurance,” they think solely of the death benefit payout, and consider it as something that will only materialize when they aren’t around anymore—which isn’t very enticing to many of us.
However in reality, it’s basically fixed income, only better.
Let me explain - I buy my Starbucks using my life insurance policy. No kidding. I could even buy a house with it. And I certainly can pay my monthly bills using it.
Here’s how it works: first, I get a whole life insurance policy. It’s important to distinguish a whole life policy from a term life policy, which is what most people think of. Whole life insurance provides permanent coverage throughout your life, and the money you pay into it as premiums accumulates over time into a cash value that you can withdraw from, or borrow against during your life - no questions asked (unlike term life insurance). You’re also earning 5-7% dividends on that cash value.
Properly understood, the death benefit is more like the final gratuity, rather than the primary focus of the policy.
Once I have the policy in-hand and have contributed enough in premiums, I can go to the bank and take out a line of credit against the cash value of my policy. I can use the LOC’s debit card to buy my espressos, sneakers, motorcycle, what have you. But I’m never losing control over my capital, which remains in that life insurance policy, into which I keep feeding premiums. In other words, I’m borrowing from myself.
In summary, the policy grants me a host of privileges and benefits: I can store my money in it, much like a bank, make tax-free withdrawals from it, borrow against it, earn stable and consistent dividends from it, and provide my family with a huge payout when I die. Not too many downsides.
So, are misunderstandings about life insurance the only reason few people take advantage of this versatile financial instrument? No. There’s another reason: it takes time and money to get it up and running.
In order to have a cash value to withdraw from or borrow against, you have to pay in significant funds through premiums. The policy I use to pay for my daily dose of caffeine, for instance, took 8 years to build up.
So a fully-functioning, well-oiled and well-producing insurance policy takes time and money to develop. This makes it out of reach or impractical for a lot of people.
But that's where blockchain and tokenization come in.
The explosion of blockchain technology onto the financial scene has opened up new and exciting doorways to new universes of opportunity. Because of its decentralized and bullet-proof ledger system, blockchain seamlessly enables fractional ownership of assets that would otherwise be unattainable for many people. We’ve seen it used for the tokenization of real world assets ('RWAs') like real estate, artwork, intellectual property, as but examples.
Now, infineo, the company I founded, is tokenizing the most valuable real-world asset: life.
We’ve created a digital security--$SOUND Token—that allows anyone to seize the investing opportunity provided by life insurance policies. $SOUND Token combines the innovation, democratization, and decentralization of blockchain technologies with the stable, time-tested, growth-opportunity of whole life insurance policies—which is the real-world asset our team found to be the most valuable after a year of in-depth analysis.
$SOUND Token represents the creation of a whole new stable asset class - a life-insurance backed security, one tradable in secondary markets. And it’s an answer to the volatility of traditional investment markets and the historic inaccessibility of traditional life insurance markets.
After my own paradigm-shifting experience with life insurance policies, I felt a responsibility to make this asset more readily available to people everywhere, from every background, and with every type of financial status.
Tokenization has made that mission a reality.
We hope our initiative can bring hope and opportunity to those who need it most, igniting financial independence and changing lives for the better—and maybe transforming the financial landscape itself in the process.
