Be the Bank: How to Use the VAULT to Build Wealth Faster Through Compound Interest, Leverage & Your Own Banking System

Be the Bank: How to Use the VAULT to Build Wealth Faster Through Compound Interest, Leverage & Your Own Banking System

by Ryan D. Lee — Wealth Outside Wall Street

What Can a VAULT Actually Do for You?

If you’ve followed the journey so far, you already know the basics of a VAULT:
It’s risk-free, tax-free, provides a private line of credit, has a guaranteed rate of return, and still functions as life insurance that protects your family.

But most people still don’t understand the real magic of a VAULT…

👉 How do you actually use it to build wealth faster than any traditional financial system?
👉 How do you turn your VAULT into a true banking system?
👉 And how does compound interest inside your VAULT outperform simple interest in the real world?

This blog breaks down the mechanics of using your VAULT — and why it is the foundation of your Passive Income Machine.

How to Use Your VAULT Like a Bank

To build wealth the way banks do, you must understand three components:

1. Cashflow
2. Leverage
3. Velocity

Let’s walk through each step of building your personal banking system using the VAULT.

Step 1: Fund Your VAULT

Just like a bank needs deposits, your VAULT needs premium.
This premium becomes cash value, and cash value becomes your line of credit.

Your money does NOT leave the policy — it continues compounding uninterrupted.

Step 2: Access Your Line of Credit (Leverage)

Here’s where the VAULT becomes incredibly powerful.

Mutual life insurance companies — the companies we use exclusively — are required by law to hold highly liquid reserves. These reserves are what allow you to borrow against your cash value.

When you have $250,000 of cash value, you can access $250,000 of the insurance company’s money through a policy loan.

Your cash value stays inside the policy, compounding without interruption.

You leverage their money while your money keeps growing.

That’s the entire game.

Step 3: Use Velocity to Increase Your Returns

Traditional financing limits you to two options when you want to buy something:

1. Save cash and spend it

2. Borrow and pay interest to a bank

The VAULT gives you a third, far more powerful option:

Use a policy loan and let your money continue compounding for life.

This is where velocity enters your system — the faster money moves and returns to your VAULT, the faster your wealth accelerates.

Why Use a Policy Loan Instead of Cash? The Math Explains Everything

Let’s walk through the most common question people ask:

“Why would I borrow money from the insurance company instead of just paying cash?”

Answer: Because compound interest always beats simple interest.

Here’s a simple, real-world example.

Example 1: Buying a Car With Your VAULT

You want a $50,000 vehicle.
Your VAULT has $50,000 of cash value.

If you take a policy loan:

• Insurance company charges 5% simple interest

• Over 5 years, you pay $6,614 in interest

• You control the repayment schedule

But…

Your $50,000 never left your VAULT.

It earns 5% compound interest the entire time:

• Year 1: $2,500

• Year 2: $2,625

• Year 3: $2,756

• Year 4: $2,894

• Year 5: $3,039

• Total: $13,814 earned

Now compare:

• You paid $6,614

• You earned $13,814

• You profited $7,200

For buying the exact same car you were going to buy anyway.

This is how banks profit — and now you can too.

Compound Interest Beats Simple Interest Every Time

This isn’t theory.
This is math.

Compound interest is exponential.
Simple interest is linear.

The spread between what you earn versus what you pay becomes pure profit.

And the VAULT allows you to use both simultaneously:

• You pay simple interest

• You earn compound interest

That’s the difference between consumers… and banks.

Example 2: Using a VAULT to Supercharge Real Estate Returns

This example is where the strategy becomes transformational.

Let’s compare two identical scenarios:

Scenario A: Buy a $100,000 Property in Cash

Over 30 years:

• Monthly cashflow: $1,000

• Appreciation: 5% annually

• Cashflow earned: $216,000

• Final value: $242,000

• Profit: $358,726

Good.
But not great.

Now let’s use the VAULT…

Scenario B: Use a Policy Loan to Buy the SAME Property

• You borrow $100,000 from your VAULT

• You repay the loan using property cashflow

• You still earn cashflow the whole time

• Your asset still appreciates

• And your VAULT compounds uninterrupted

After 30 years:

• Cashflow after policy loan payments: $22,744

• Property value: $242,000

• Profit after debt servicing: $165,740

• VAULT cash value grows from $100,000 → $574,349

TOTAL WEALTH: $739,819

Same property.
Same rent.
Same appreciation.

Just a better system.

Side-by-Side Comparison

Strategy

Total Wealth After 30 Years

Pay Cash for Real Estate

$358,726

Use VAULT + Policy Loan

$739,819

You more than doubled your wealth — using the same property.

This is why the VAULT is Gear #2 of the Passive Income Machine.

Because it turns ordinary transactions into wealth-multiplying engines.

How Much Money Should Flow Through Your VAULT?

Not your grocery budget.
Not your everyday expenses.

But every dollar you:

• Save

• Hold for opportunity

• Intend to invest

• Want compounding

• Want tax-free in the future

…should start inside your VAULT.

It allows your money to do multiple jobs:

1. Compounding tax-free

2. Protecting your family

3. Becoming collateral

4. Funding investments

5. Returning tax-free income in retirement

That’s why the VAULT is the foundation of your Passive Income Machine.

RISE UP. LIVE FREE.
— Ryan D. Lee, Wealth Outside Wall Street