Using Other People's Money: OPM Leverage Strategies

The wealthy rarely use only their own capital. Learn how to ethically and strategically use other people's money to accelerate wealth.

Learn OPM Strategies

It's not about having money. It's about controlling money.

Why the Wealthy Use OPM

Other People's Money (OPM) is the foundation of how the wealthy build and scale wealth faster than their income alone would allow.

The Middle-Class Mindset

Save up cash
Buy asset outright
Wait for it to appreciate
Repeat (slowly)

Result: Wealth grows linearly with income.

The Wealth-Builder Mindset

Control asset with minimal capital
Borrow the rest (OPM)
Let asset appreciate (you own 100%, only paid 20%)
Refinance or sell, extract equity
Repeat immediately with multiple assets

Result: Wealth grows exponentially, independent of income.

Different strategies for different goals

Types of OPM

🏦

Traditional Lending

Mortgages, business loans, SBA loans. Requires credit approval, income verification, and debt service. Good for real estate and scalable businesses.

🤝

Investor Capital

Angel investors, private equity, venture capital. Trade equity for capital. Good for high-growth businesses that need fuel fast.

💰

Policy Loans (Infinite Banking)

Borrow against your own cash value. No credit check, no approval. Your collateral continues growing. Good for flexible, immediate capital needs.

Why 5:1 leverage is standard in real estate

Real Estate: The Classic OPM Play

Scenario: Buying Investment Property

Option 1: All Cash

Buy $500K property with cash
Property appreciates 5%/year = $25K/year
Rental income (net): $15K/year
Total return: $40K/year on $500K = 8% ROI

Option 2: Using OPM (20% Down)

Buy $500K property with $100K down (80% mortgage)
Property still appreciates $25K/year
Rental income minus mortgage payment: $3K/year
Total return: $28K/year on $100K = 28% ROI

3.5x better ROI using OPM. Plus, you still have $400K to deploy elsewhere.

Bonus: If you used policy loans for the $100K down payment (while cash value keeps growing), your effective ROI is even higher because your collateral didn't stop compounding.

Why bootstrapping is slow (and sometimes unnecessary)

Business Growth: OPM for Scaling

Bootstrap Model

Reinvest all profits
Growth limited by cash flow
Slow market penetration
Risk: Competitors outpace you

Timeline: 5-10 years to reach $5M revenue

OPM Model

Inject capital from investors or policy loans
Aggressive marketing and hiring
Rapid market share capture
Risk: Must hit growth targets

Timeline: 18-36 months to $5M revenue

Key insight: If your business returns 20-30% on invested capital, borrowing at 5-8% is a no-brainer. The spread is your profit.

Why Infinite Banking is the ultimate OPM strategy

IUL Policy Loans: The Most Flexible OPM

Traditional OPM Challenges

❌ Requires credit approval
❌ Income/asset verification
❌ Strict repayment terms
❌ Loans can be called (margin, HELOC)
❌ Collateral at risk

Policy Loan Advantages

✅ No credit check
✅ No approval process
✅ Flexible repayment (or none)
✅ Can NEVER be called
✅ Collateral continues growing

With Infinite Banking, you're using your own money as OPM. You borrow against your cash value, but the insurance company is technically lending you their money (using your cash value as collateral). Your cash value keeps compounding as if you never borrowed.

It's the best of both worlds: the control of your own capital + the leverage of OPM.

How leverage compounds returns

The OPM Wealth Multiplication Formula

Wealth Multiplication Formula

ROI = (Asset Return - Cost of Capital) × Leverage Multiple

Example 1: No Leverage

Asset Return: 10%

Cost of Capital: 0% (all cash)

Leverage: 1x

ROI: 10%

Example 2: 5:1 Leverage

Asset Return: 10%

Cost of Capital: 5%

Leverage: 5x

ROI: 25%

Same asset, 2.5x better return simply by using OPM.

Frequently Asked Questions

Consumer debt is bad (credit cards, auto loans for depreciating assets). Leverage is different — using borrowed capital to acquire appreciating assets or generate returns higher than the cost of borrowing.

This is why the wealthy use non-recourse loans (real estate mortgages) or policy loans (which can't be called). The downside is limited while the upside is unlimited.

For traditional lending, yes. But policy loans require no credit check, no approval process, and no income verification. It's YOUR money being used as collateral.

Margin loans are callable and can force liquidation in a downturn. Policy loans can't be called, have no payment schedule, and your collateral continues growing.

Ready to Use OPM Strategically?

OPM is powerful when used strategically. The key is understanding which form of leverage is appropriate for which goal, and structuring your financial foundation to have immediate capital access when opportunities arise.

Schedule a Strategy Session