📘 Session Recap: Lost Opportunity Cost & New Financial Planning Software Introduction

🔑 Key Takeaways

• Lost opportunity cost is a critical but often overlooked aspect of financial planning—it represents money lost unknowingly and unnecessarily.

• Time is one of the most valuable elements in wealth-building—delaying savings or investments can severely impact long-term results.

• Whole life insurance policies offer tax-free growth, control, and flexibility—positioning them as powerful tools for efficient financial stewardship.

• Small reductions in spending (e.g. 1%) can have a greater long-term impact than chasing high-risk investments.

📚 Topics Covered

🔄 Circle of Wealth

• Financial world divided into three categories:

  1. Accumulated Money – savings and investments (e.g. 401(k), IRAs, stocks, real estate)

  2. Lifestyle Money – spending on needs and wants (e.g. food, clothes, vacations)

  3. Transferred Money – money leaving your control unnecessarily (e.g. excess taxes, interest payments, fees)

Goal: Minimize wealth transfers and redirect those dollars toward building lasting wealth.

💸 Lost Opportunity Cost

• Definition: The future value lost when money is unnecessarily spent or misallocated.

• Examples:

  • $1,000 in avoidable taxes doesn't just cost $1,000—it could cost thousands in future growth.

  • $10,000 in credit card debt at 18% could grow to $78,000 in lost opportunity over 40 years.

  • Banks and lenders profit massively—potentially earning $13 million over 40 years from interest paid by consumers.

Every dollar leaving your control today has a compounding cost tomorrow.

🕒 Time Value of Money

• Delaying savings by just 5–10 years drastically reduces retirement outcomes.

• Illustration:

  • $5,000/year saved at 5% over 30 years = $353,804

  • Draining the account every 5 years drops it to just $71,000

• Start early, save consistently—this leads to lower risk requirements later in life.

🛡️ Whole Life Insurance Policies

• Serve as tax-advantaged, low-risk savings vehicles.

• Key benefits:

  • Tax-free growth and tax-free access via policy loans

  • Guaranteed growth of cash value

  • Use for financing purchases without interrupting compounding

  • Flexible premiums and repayment terms

  • Can outperform market-based strategies when adjusted for taxes, volatility, and risk

Whole life policies help you retain control over your money while still building wealth.

🙏 Financial Stewardship

• Emphasizes responsible use of resources, not just accumulation

• Encouraged attendees to:

  • Cut spending by 1% and track the long-term impact

  • Consider giving, especially when expenses are reduced

  • Reflect on the Parable of the Talents (Matthew 25)—a biblical lesson in using money wisely and productively

🧰 New Financial Planning Software

• Interactive tool introduced to:

  • Visualize lost opportunity costs

  • Track wealth transfers

  • Simulate “what-if” scenarios for taxes, investments, and insurance

  • Compare outcomes with/without whole life policies

• Designed to support individual consultations and long-term planning

📌 Next Steps

• Review the Parable of the Talents (Matthew 25) as a lens for financial stewardship

• Look for ways to cut expenses by 1% and redirect savings to productive use

• Evaluate your current strategy in light of lost opportunity costs

• Schedule a consultation to explore:

  • How the new software can model your financial future

  • Whether a whole life policy aligns with your goals