Health Insurance Strategies Every Real Estate Investor Must Know

Parker Wilcox (00:00)
I have a friend, he owns a sales company. And he had previously been on a marketplace ACA plan that his family was on. He has a wife and he has three kids. They’re all very healthy, they’re active, they’re a great little family. He’s doing awesome with his company, he’s making tons of money. But because of that, he’s making tons of money and his household is…

fairly large, you know, with a wife and three kids, he qualified for no subsidies. He was paying full price for this ACA plan at something like $2,100 per month. So it was just forking out tons of money. Obviously, insurance is very important to have in case of emergencies, in case something crazy happens. But he was forking out lots and lots of money each month and each year for something that he wasn’t necessarily using because he’s healthy, and so is his family.

And so we evaluated and we looked at it and we got him onto that private plan and it’s gonna cover, it’s gonna give him all the same benefits, it’s gonna help him in the same exact ways, emergencies, checkups, his kids can go to the doctor, his wife can go to the doctor, and we knocked him down from about that much, 2100, all the way down to about $600 per month. So something like,

$1,000 to $1,500 of savings. And with that $600, he’s got accident coverage in case something crazy that will cover his deductible. He’s got coverage also for dental and vision. It just makes so much more sense to be on that side of things than to be on a marketplace

Michelle Kesil (03:09)
Hey everyone, welcome to the Investor Fuel podcast. I’m your host, Michelle Kesil. And today I’m joined by someone I’m looking forward to chatting with, Parker Wilcox, who’s been making serious moves in the health and life insurance space as far as helping realtors and investors figure out how to structure that best. So excited to have you here on the show today, Parker. I think the listeners, yeah.

Parker Wilcox (03:34)
Thanks, Michelle.

Michelle Kesil (03:35)
think the listeners are going to get a lot of nice tips and tricks from you. So let’s dive in.

Parker Wilcox (03:41)
OK, well, I can dive in and kind of give my spiel right from the get-go. Is that how you want it to be? Or do you have specific questions that you have?

Michelle Kesil (03:48)
Yeah,

I was just going to ask you like to just kind of share why it is that you’re focused on right now, what it is that you do. So go ahead and yeah, share your little spiel.

Parker Wilcox (04:00)
Okay,

well, the obvious question to anyone listening to your podcast today is gonna be why on earth is a health insurance broker on a real estate podcast? And it’s a valid question, and the reason is, is because health insurance and taxes are tightly tied to each other, more tightly tied than people might expect. And it’s the same with real estate, right? So.

I’ll kind of establish this conflict here that is in the, there’s a conflict of interest in the real estate world and then in the health insurance world. And then I’ll explain how structuring your health insurance and life insurance in a specific way can help you better invest in real estate and make those purchases on mortgage terms and stuff. So there’s a,

Let me take you to a bird’s eye view basically of the health insurance world. There is, this is in the US. There is the marketplace, a federal marketplace for Obamacare health insurance plans. And those are referred to as the marketplace, they’re referred to as government sponsored ACA, Affordable Care Act. That’s what they’re referred to as. And ACA plans, the premiums that you pay each month on your health insurance,

are not based on your health at all. They’re based on your income. So it’s kind of like a progressive tax system. The more you make and the more that you report to the IRS each year that you make on your taxes, the more that you will pay per month on your health insurance. And the reason that matters is because these people that are trying to invest in real estate or just purchased their first home, depending on their household size, if they have a spouse and kids,

they’re going to qualify for more or less subsidies depending on their income levels. Does that make sense?

Michelle Kesil (06:27)
Yeah, absolutely.

Parker Wilcox (06:28)
Okay. So say like a family of four, you know, a guy has a wife and he has two kids and he’s at 80k per year on his salary and he’s self-employed, right? With his company or whatever that he’s doing. He’s going to qualify for a lot more subsidies and he’s going to, or discounts rather, that’s what a subsidy is on your health insurance. He’s going to qualify for a lot more than someone making 80k and they’re single.

because he has a bigger household. So the other side of that coin on health insurance is the private market. The private market is they are health-based plans. The premium that you pay each month is based on not your income, but your health. So as long as you’re relatively healthy, they will charge you relatively low prices. And it’s not tied whatsoever to your taxes, it’s not tied to your income, it’s not tied to your 1099, your W-2, whatever.

There’s a big difference there. And the reason that that’s important in real estate is because there is kind of these two conflicting interests. A lot of times when I help entrepreneurs and self-employed people structure their health insurance, I’d say, hey, write off your income. Do all the deductions that you can. If you can show a low income on your IRS tax return, then you’re going to get lower premiums on your health insurance. Huge win for them, right? They get.

a state sponsored plan, it’s great, and they get lower premiums because they’re right out of their income. But the conflict here, and this is why it’s relevant on this podcast, is if they’re trying to qualify for a mortgage, then they have to be actually reporting income and reporting something that the mortgage company is going to look at and say, all right, he’s able to pay back his loan, he’s able to pay his mortgage each month. But if you’re deducting all of that for the sake of health insurance premiums and you’re on a state sponsored plan, then it’s

then it’s kind of a problem and it poses this conflict of interest. Does that make sense? And so the reason I bring that up is, hey, these people need to get onto a private plan just for even the time being that they can take the factor of the taxes and their IRS earnings out of the health insurance game so that they can.

Michelle Kesil (08:17)
Sure.

Parker Wilcox (08:38)
report as much as they want and report all of that to the mortgage and the lending company.

Michelle Kesil (08:42)
Awesome. Yeah, that’s so interesting. So what would you say like most real estate investors are doing versus what you feel they could do that would benefit them more?

Parker Wilcox (08:55)
Sorry, I’m not sure if I understood the question. One more time.

Michelle Kesil (08:58)
Like what are kind of like the common things with the insurance space that real estate people you see like they’re the plans that they’re in or what they’re doing versus what you feel is like the better option for them that will support them.

Parker Wilcox (09:47)
Good question. So a lot of times, someone, let’s say it’s a young family and they’re purchasing rental properties for their portfolio. And they’re doing it, they have, one of the spouses, let’s say, is on a group health insurance plan that the entire family is on. That is an ACA, or Affordable Care Act plan, that is going to basically go, it’s going to go directly off their income.

And the reason that I often reach out to entrepreneurs is a lot of the time that spouse is in that job just for the health insurance. Because they think, oh, it’s a great health insurance plan. We need it. This is the only way we can get it on a group plan. That is not the case. Not the case at all. A lot of the times, these spouses are keeping jobs just for the health insurance. And so I say, hey, you if you’ve been waiting to make the leap to

know, self-employed just because of health insurance, don’t make that the reason. You know, like get out of the nine-to-five job, invest in your new company, invest in your self-employment, whatever entrepreneur, you know, goals that you have, and get yourself either onto a, you can do an ACA plan solo, but if you’re trying to qualify for a mortgage, you’re gonna wanna report your income as high as you possibly can.

So get out of the ACA, get out of those marketplace federal plans, get onto a private plan.

And they work the same way. They’re both major medical plans. You can go to your doctor and get checkups, get preventative visits. Obviously, emergencies are going to be covered. Private plans are nice because they’re a little more tailorable. You don’t have to have all of the exact same coverages. The ACA plans are required to have by government standards.

Michelle Kesil (11:27)
Amazing. And yeah, like what are kind of those benefits from a private plan that people might be missing out on if they don’t go that route?

Parker Wilcox (11:38)
Honestly, it’s a lot of time it’s these low premiums. I’ll give you an example.

I have a friend, he owns a sales company. And he had previously been on a marketplace ACA plan that his family was on. He has a wife and he has three kids. They’re all very healthy, they’re active, they’re a great little family. He’s doing awesome with his company, he’s making tons of money. But because of that, he’s making tons of money and his household is…

fairly large, you know, with a wife and three kids, he qualified for no subsidies. He was paying full price for this ACA plan at something like $2,100 per month. So it was just forking out tons of money. Obviously, insurance is very important to have in case of emergencies, in case something crazy happens. But he was forking out lots and lots of money each month and each year for something that he wasn’t necessarily using because he’s healthy, and so is his family.

And so we evaluated and we looked at it and we got him onto that private plan and it’s gonna cover, it’s gonna give him all the same benefits, it’s gonna help him in the same exact ways, emergencies, checkups, his kids can go to the doctor, his wife can go to the doctor, and we knocked him down from about that much, 2100, all the way down to about $600 per month. So something like,

$1,000 to $1,500 of savings. And with that $600, he’s got accident coverage in case something crazy that will cover his deductible. He’s got coverage also for dental and vision. It just makes so much more sense to be on that side of things than to be on a marketplace

By the way, he invests in a lot of real estate. And so this allows him to qualify and report as much income as he wants. He buys up commercial properties, he buys up residential properties, and this just gives him the freedom to do that without paying $2,100 per month on his health insurance.

Michelle Kesil (14:19)
Yeah, that’s big. So what are you like most focused on solving or scaling when it comes to your business?

Parker Wilcox (14:28)
Honestly, it’s this education factor and it’s helping people understand how these two worlds work. health insurance is different than car insurance, home insurance, business insurance, but even within health insurance, like I said, on this bird’s eye view, there’s these two worlds. There’s the private world and there’s the public world. And a lot of Americans are in the public world on their group health insurance plan through their employer. And that’s great.

But a lot of them either want to get out and they feel like they can’t simply because of health insurance and they want to be self-employed or they’re facing this dilemma of, hey, you know, I can either save on my health insurance because I’m writing it off or I can buy this, you know, so-and-so property and qualify for the mortgage. But I can’t really do both and still save money. But all of a sudden, if you switch from the ACA world to the private world, it gives you the leeway to do that.

Michelle Kesil (15:24)
Yeah, absolutely. And what are you using to educate people? Are you connecting mostly with real estate people, investors? How are you achieving this goal?

Parker Wilcox (15:34)
Good question.

I help a lot of financial advisors with their clients. Obviously, a financial advisor is going to have a big, comprehensive view of someone’s financial standing. And so I help them save on that front. And their clients, realtors, lenders, I have friends with a lot of mortgage lenders. It’s the same exact thing, helping their clients to do that.

The mortgage, when I do that, all three parties are very happy. I’m happy because I help someone with their health insurance and I get paid for that. The lender is happy because their client is gonna all of sudden qualify for loans that they weren’t able to before. And the client’s happy because they’re saving tons of money on their health insurance. And even if they’re not, there might be cases where they might pay a little bit more on the private market. But if it’s just for maybe a 12 month period.

That is so worth it to get into that dream property, that dream house, or buy the commercial warehouse or whatever it is that they’re trying to get and invest in. For 12-month period, that is worth the private market rates that they’re paying to qualify for that type of thing. And honestly, most of the time, I’d say 70 to 80 % of the time, they’re going to be saving money and paying less than they were on the marketplace.

Michelle Kesil (16:45)
Yeah, that’s amazing, awesome. So what are like, yeah, just some things that people should be educated on that maybe they don’t have any knowledge on?

Parker Wilcox (16:57)
So I have an Instagram. It’s the name of my business, Lifeguard Protection. The Instagram is lifeguard.protection. It’s right there on Instagram. And it’s full of posts that will help people understand this type of thing. I say bird’s eye view a lot because that helps at least me visualize the entire industry. It’s like, let’s go to a bird’s eye view. Let’s look at the entire market, the entire industry of health insurance, and say, where I’m at right now.

and maybe where I should be as opposed to where I’m at right now. Like, should I be moving over in, you know, should I go to a private market? Do I need something like an ACA plan? Because there are, you know, there are certain situations where people might need to split, you know, and it’s possible to do that. If a spouse is, let’s say, pregnant and they need help with pregnancy and labor and delivery and prenatal visits, they can be on an ACA plan because private plans actually

usually won’t cover that type of thing. So I say get just your wife onto a marketplace plan, an ACA plan that will cover her for that type of thing. And everyone else go on the private plan. whatever. But educating yourself and learning on these things is the same with taxes. When you learn more about taxes, how the tax system works in the US, when you talk to a tax advisor, when you talk to a CPA, and you learn, ⁓ like,

There are certain strategies that I didn’t know about that I can now use and save myself a lot of worry and a lot of money every year. It’s the same thing with health insurance. That is my passion. That’s why I love how people to do is kind of bridge that education gap and gain more knowledge so that they can be saving money, be happy.

Michelle Kesil (18:33)
Yeah, absolutely. think that knowing those little tips and tricks and education things, it’s like not everyone has the time and energy to look into all these areas. So we need people that are doing that and sharing. So thank you for that.

Parker Wilcox (18:47)
Yeah.

So your audience is going to be realtors, real estate agents, lenders, anyone that’s in the investing space in real estate, correct? What type of questions do you think they might have or what type of, I don’t know, what kind of gap are they trying to bridge in this space?

Michelle Kesil (18:55)
Yeah.

Yeah, I would say they are probably looking to level up in their business, scale their business, grow, raise capital. So those are kind of the main things.

Parker Wilcox (19:12)
Yeah.

OK, awesome. And are these people, like, are they buying, you know, residential rental properties? What type of properties are they trying to invest in?

Michelle Kesil (19:14)
Yeah.

It’s

quite mixed. Yeah, it’s like everyone’s doing their own thing when it comes to the types of investing. There’s, yeah, broad range.

Parker Wilcox (19:30)
Okay, yeah, well these strategies can help anybody. Let’s say that, you know, maybe they’re a small business owner and they’re trying to offer their employees health insurance. It’s the same thing. Oftentimes, a small business, if it’s 50 employees or less, a group plan might make sense and it might save them some money overall, but oftentimes it’s not the case. It’s easier just to get everyone insured individually and for the same exact reasons.

If everyone’s relatively healthy, if they don’t have any cancer pending or anything like that, a private plan is going to help. And the reason I say that is because if they get cancer after they’re on the private plan, they’re totally fine. They’re covered. But private plans will screen you based on your pre-existing conditions and your health. Whereas ACA or marketplace plans, they’ll accept you no matter what. They’re required to.

Michelle Kesil (20:15)
Amazing. Thank you for sharing all of that insight, wisdom, and valuable tips. yeah, before we wrap up here, if someone wants to reach out, connect with you, learn more from you, where is the best place that they can connect with you and find you?

Parker Wilcox (20:29)
I would say on the Instagram, it’s the best place. You can find all my contact info there. It’s lifeguard.protection. It’s right there on Instagram, and it has all that informational posts. And in the bio, there’s going to be info. I can mention my phone number right here on the air as well, if you’d like. you can reach straight out to my personal cell, and you can call or text it. I’ll reach out within the day. And it’s 435.

Michelle Kesil (20:46)
Yeah, up to you.

Parker Wilcox (20:56)
654-8256.

Michelle Kesil (20:58)
Perfect. Well, listen, I appreciate your time, your story and perspective. We need more people in this space doing things in this right way. So thank you for being here.

Parker Wilcox (21:07)
Okay, Michelle, thank you so much. I appreciate it.

Michelle Kesil (21:09)
Yeah, and for those of you that are tuning in, if you got value from this, make sure you’ve subscribed. We have more conversations coming with operators just like Parker who are building real businesses. And we’ll see you all on the next