The Freedom Asset Manager: A Powerful Financial Platform for Individuals and Businesses

At the most basic level, the Freedom Asset Manager is a first mortgage that consolodates your mortgage, checking account and home equity line of credit into a single account. It is also a principal-first mortgage, unlike the interest-first mortgages that dominated the banking industry throughout most of the 20th Century. This means that every dollar you deposit into your account immediately reduces your mortgage principal and significantly reduces the total interest and time it takes to pay off your mortgage.

The principal-first nature of the Freedom Asset Manager account can help you pay your mortgage off in less than half the time of all other interest-first 30-year fixed mortgages and it can save you hundreds of thousands of dollars.* However, the Freedom Asset Manager can do much more because it provides tremendous financial flexibility for you to manage all your personal and/or business assets in ways that maximize your cash flow and increase the value of your entire net worth. For these reasons, you should think of the Freedom Asset Manager as a powerful financial platform that can make all your financial and personal goals much easier and faster to achieve.

What Does “Tremendous Financial Flexibility” Really Mean?

It means that you are in control of how much you save or spend—not just on your mortgage—but also on all your existing credit cards, medical bills, college loans, and all other personal and business expenses. The following is a partial list of examples of what you can do with the Freedom Asset Manager.

• Reduce all your monthly expenses by paying a single low interest rate.
• Consolidate all your other debts (credit cards, medical bills, college loans, etc.) into a single monthly payment.
• “Be your own bank” and finance all your major purchases yourself at the same low interest rate as your mortgage without taking out additional loans (cars, boats, vacations, etc.).
• Purchase one or more additional properties.
• Pay for yours and/or your children’s university education.
• Pay for unexpected emergencies like medical bills and property damage from natural disasters.
• Protect yourself from unexpected layoffs.
• Take an extended maternity leave to make the best of those first precious months with your child.
• Truly enjoy the gift-giving experience during holidays instead of choosing between giving gifts and paying bills.
• “Earn the interest you save” by using a company bonus, family inheritance or other large cash windfall to immediately decrease your mortgage and save all the interest you would have paid.
• Pay for home improvements.
• Start a new business.
• Expand an existing business.
• Even out your personal or business cash flow during cyclical or reduced income periods.

Be a “Home Owner” Not a “Mortgage Holder”.

Many people feel that the mere process of signing a mortgage contract makes them “home owners,” but they are merely “mortgage holders” until they actually pay off the principal of their homes. This misconception causes many people to overlook the fact that a home is not an asset until you own it. That means your home is actually your biggest liability until it is paid off. In fact, when the housing market takes a down turn, this reality becomes painfully obvious when mortgage holders try to sell their homes. If they don’t own the home outright and/or have a significant amount of equity in the home, they lose a significant amount of money on the sale.

The Freedom Asset Manager can help you achieve real home ownership in half the time of a 30-year fixed mortgage instead of spending 30 years in a state of “home mortgageship.”

Focus on Total Cost of Ownership, Not Interest Rate.

Successful businesses understand this concept very well. The total cost of ownership (TCO) is a key factor in all business asset purchases. Unfortunately, inexperienced consumers often overlook this concept and end up focusing on the wrong factor when comparing one mortgage with another. For these reasons, Reyes Capital Group always reminds our clients that the most important thing to consider when purchasing or refinancing a home is not the interest rate; it’s the total amount of interest expense that you pay over the life of your loan.

Although the interest rates that our clients enjoy with the Freedom Asset Manager are comparable to typical 30-year fixed mortgages, our clients often still like to see how much they would save even at unrealistically high interest rates. They are usually shocked to see that even double-digit interest rates would yield substantial interest savings with the Freedom Asset Manager. This may seem counter-intuitive until you remember that the Freedom Asset Manager is a principal-first mortgage. That means that every dollar you deposit into your Freedom Asset Manager account goes directly toward paying down your principal.

All other mortgages are interest-first "front-loaded" mortgages that force you to pay the bank’s interest first each month and only a small fraction of your payment is applied to your principal during the most crucial early years of your mortgage. In contrast, the Freedom Asset Manager enables you to pay down your principal much more quickly so the total cost of your mortgage—even at unrealistically high interest rates—is lower than the total cost of a typical 30-year fixed mortgage.

“Overpaying” Your Mortgage is Not the Same as a “Principal-First” Mortgage.

Many companies sell “programs” or “systems” that essentially amount to helping you overpay your 30-year fixed mortgage each month. Indeed, this will reduce the overall cost of your mortgage to some degree, but you don’t need to purchase a special program to do this. More importantly, even when you double-up on your monthly payments, you’re still paying on a front-loaded interest-first mortgage. In other words, you’re simply paying all the bank’s interest faster so you can start paying toward a more significant amount of your principal “sooner.” But even in the most aggressive overpayment strategies where the mortgage holder is working tirelessly to overpay each month, an interest-first mortgage will still take many more years to pay off than a principal-first mortgage. And in the process of working so hard to double-up on your payments, the quality of your life will inevitably suffer because of all the time you have to spend working to continue making those overpayments.

The Freedom Asset Manager can help you pay off your mortgage in half the time and save hundreds of thousands of dollars without working yourself to death in the process.* In fact, you don’t have to change your spending habits at all to achieve these results; and in many cases, the principal-first nature of the Freedom Asset Manager causes our clients’ monthly mortgage payments to be substantially less than they were with a 30-year fixed mortgage.

Build Real Wealth, Not Just Equity.

You may have heard of the phrase “Asset rich, cash poor.” This is precisely the situation most homeowners find themselves in even when the value of their homes appreciates significantly. Home equity lines of credit and home equity loans can enable people to gain access to an amount of cash up to the amount of equity they have in the home. However, the amount of equity that is available and the speed at which the equity accumulates in an interest-first mortgage is much less than with a principal-first mortgage. Additionally, most mortgage holders have to refinance periodically (and pay the associated fees) to continue to tap into the increasing equity in their homes.

In contrast, the Freedom Asset Manager gives you immediate and continuous access to your equity during the entire life of your mortgage. The amount of cash that you can access increases automatically as your equity increases and you don’t need to repeatedly go back to the bank and pay more and more refinance fees to benefit from your increased equity. As a result, you’re building real wealth by having access to real cash while simultaneously eliminating the repeated expenses typically associated with other methods of accessing your home’s equity.

Enjoy the Same Low Interest Rate for All Your Purchases.

When most people don’t have enough money to pay for a major expense, e.g., a car, a pool for their home, college tuition, medical bills, etc., they either take out a loan from the bank or make the purchase with a credit card. These loans and credit cards always have much higher interest rates than a mortgage. However, if you use the Freedom Asset Manager to make these purchases you will avoid the high interest rates of those other forms of payment and you will enjoy the same low interest rate on those important purchases as you do on your mortgage. 

Tailor Your Expenses to Suit Your Unique Lifestyle.

The Freedom Asset Manager is the only principal-first mortgage and financial platform that immediately adjusts to changes in your lifestyle. No refinancing, new loans or other financial tricks are necessary. Simply write a check or use your Freedom Asset Manager ATM card to navigate virtually any financial situation you and your family may encounter.
 
Transform Lump Sum Cash Receipts Into Ongoing Savings.

Inheritances, lottery winnings, employment bonuses, matured investments, court settlements and other windfall financial events provide great opportunities for you to use your Freedom Asset Manager to reduce your mortgage balance very quickly, which enables you to save even more interest. This is much better than depositing your money into a low- or no-interest bearing checking or money market account. 

Simplify Your Investment Strategy.

Some people spend a significant amount of time managing their investment portfolios to ensure that their investments are yielding an acceptable return. The typical active investor spends time every day buying and selling stocks and/or bonds, moving cash in and out of mutual funds, learning about the latest investment strategies, researching economic trends, and trying to anticipate which direction the market is heading. Every stock and mutual fund transaction and the high quality research tools required to make profitable investments cost money. Additionally, the time required to manage all these investments could be better spent on other more productive and fulfilling activities.

The Freedom Asset Manager provides a simple but powerful investment opportunity: You can forget about all the guesswork, time and expense associated to trying to play the stock market and get a guaranteed rate of return on the money you deposit into your Freedom Asset Manager account equivalent to the interest rate of your mortgage. For example, if your Freedom Asset Manager mortgage rate is 6%, then every dollar you deposit into your account will return savings of 6%, which is the same as earning 6%.

To some professional investors, 6% (or whatever their mortgage rate is) might not seem like a very high return on their investment. However, when they consider all the transaction costs, the expended time and other intangible costs associated to other types of investments, those other investments may not appear as profitable when compared to the interest and time savings that they can achieve with the Freedom Asset Manager.

Earn What You Save.

We have all heard that “a dollar saved is a dollar earned.” However, if the “dollar saved is a dollar earned” concept still seems a little vague, think of it this way: If you have a 10-dollar bill in your hand that you plan to use to purchase your breakfast, but somebody steals that money from you, you won’t be able to eat breakfast until you earn another 10 dollars. But if you can prevent the thief from stealing the 10-dollar bill in the first place, you won’t have to work to earn more money to eat breakfast. By saving the 10 dollars, you will have earned the ability to eat breakfast now instead of being forced to wait to eat until some time in the future.

The interest savings that you can achieve with the Freedom Asset Manager means that you can prevent the bank from taking the money that you’ve worked so hard to earn. Thus, the time that you save because you don’t have to earn back those dollars can now be used to do more productive things, e.g., spend more time with your family, finish your college degree, travel to another country, earn even more money from your employer, or whatever else you would like to do with the time you can save as a result of the interest you can save on your mortgage.

Maximizing Cash Flow for Business Owners has Never Been Easier.

All business owners have experienced periods of cyclical and/or decreased income. Variable income periods reduce the efficiency of companies and present obstacles to business growth. Business owners often take a number of actions to reduce the impact of these income doldrums, including cutting back on important services, reducing inventory, firing valuable employees, reducing marketing and advertising budgets, and other necessary expenses.

Business owners previously have not had any choice but to perform these cost-cutting actions. Unfortunately these actions often exacerbate the fundamental market conditions that caused the decrease in income in the first place. In other words, eliminating important services, employees, marketing, etc., reduces the company’s operational efficiency and reduces revenue. Reduced efficiency and revenue often results in longer recovery time, or worse, it sends a company into a downward spiral of inefficiency and depressed revenues until the company can no longer operate, forcing the business into bankruptcy.

However, with the Freedom Asset Manager, business owners can safely access the equity of their personal and/or commercial properties to withstand economic downturns. The actual mechanics of these transactions must abide by IRS rules, which involve a number of factors, but the process is not complicated. After the business owner understands how the process works, the company is able to not only survive adverse economic conditions, it can expand even more rapidly during economic booms. This is because the company will have the resources to take advantage of business opportunities that would otherwise be impossible to pursue without the added flexibility of having access to the business owner’s and/or company’s equity.

* Your specific savings will depend on your specific financial situation.