As far as I understand it, a billionaire’s wealth is wrapped up in stock, which is used as collateral to borrow money to actually spend. So how do they pay off those loans? With other loans? Loans all the way down?
In: Economics
You don’t even have to be a billionaire. Whole life insurance is an asset you can take a loan against for about 90% of the value. Take the money out, get a loan secured again a housing property, flip it, pay back the housing loan, take the difference, buy a bigger house, etc. Make sure to keep paying the whole life insurance yearly premiums for about 10 years, until eventually the value of the life insurance pays the premiums itself.
The life insurance becomes a loan vehicle that repays itself on the payout (at the time of your death.)
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