Business Innovators Radio - Interview with Ethan Heisey, CEO of Exponential Freedom Discussing How to Grow Your Money Tax Free

Episode Date: September 12, 2025

Ethan is the CEO of Exponential Freedom, Ethan’s drive for leadership and financial freedom surpasses many other traditional approaches. He is a public speaker at many events, along with formulating a company of many employees who hold his trust. His consulting services have helped over 2,000 persons in the art of saving Tax, increasing their net worth, and driving business revenue.Learn more: https://theexponentialfreedom.com/The information provided during this appearance is for general informational purposes only and should not be considered personalized financial, tax, or investment advice. Each individual’s situation is unique, and viewers are encouraged to consult with a licensed financial professional before making any decisions. Exponential Freedom is a consulting and marketing firm—we do not offer financial advice or make recommendations. Instead, we connect clients with qualified, licensed professionals best suited to their specific needs.Influential Entrepreneurs with Mike Saundershttps://businessinnovatorsradio.com/influential-entrepreneurs-with-mike-saunders/Source: https://businessinnovatorsradio.com/interview-with-ethan-heisey-ceo-of-exponential-freedom-discussing-how-to-grow-your-money-tax-freehttps://businessinnovatorsradio.com/influential-entrepreneurs-with-mike-saunders/

Welcome to influential entrepreneurs, bringing you interviews with elite business leaders and experts, sharing tips and strategies for elevating your business to the next level. Here's your host, Mike Saunders. Hello and welcome to this episode of influential entrepreneurs. This is Mike Saunders, the authority positioning coach. Today we have with us, Ethan Heise, who's the CEO of Exponential Freedom, and we'll be talking about how to grow your money tax-free. Ethan, welcome to the program. Thank you, Mike. It's a pleasure to be here.

I'm excited. Yeah, I'm interested in talking with you. And I always love learning about different life experiences and what brought someone to talk about these topics. And I love the name Exponential Freedom because Freedom is one of my life words that resonates with me. And I love the idea of exponential freedom. So I want to also get into how you named your company as well. But get it started with a little bit of your story. and background and how'd you get into the financial services industry.

Name of the company was a struggle. I think these days there's about an LLC out there for everything. So it was more, let me go to chat GTP and figure out how can I find something that's not already out there. And then I mean, you go on a financial planning business. Everything's out there, freedom financial or whatever it is. So we just put that word. And that was actually a business I had prior to.

starting in the industry. So I was like, you know what? I'm just going to pick that one up and keep going with it. And yep, don't look back. Let's move forward. That's awesome. That's right. So how did you originally get into the financial services industry?

You know, I started, you want to know the illegal route on how we did this? Maybe not. When I was in college, I started day trading stocks because I, I googled, how do I make money? I want to make some sort of money. And the first thing that popped up was real estate. The second thing that popped up was the stock market. And I was like, well, I don't have money for real estate.

But I do have some money to try day trading stocks. And I was a server at Cracker Barrel all the time. So I saved up about $500 or so. I opened up a brokerage account, started day trading, turned that $500 into about $5,000 in two months. and I said, you know, if I could do this for other people, I could get rich. So I did. I started collecting all of my friends' monies to do this. And I put flyers all over the campus while I was a freshman or sophomore year.

I can't quite remember. And so people were just coming left and right, gathering money from, you know, pulling change out of their pocket to give it to me. So I created this, I guess it called a legal hedge fund. So don't recommend doing that. I didn't really know what I did it. Yeah. Of course.

Exactly. Start to trade their money. You know, the interesting thing was you discovered something that worked and then your first thought was how can I serve other people? How can I use this knowledge? And I would venture to say as you got more and more into learning about financial services, there's a lot of things that the general public just doesn't know. Uh-huh.

100%. Yeah. What I realized, though, was, you know, after speaking with some professors about this, they recommended me not to do that because I did not have license. So I eventually had to give everyone's money back to them. Yeah, full disclosure. Now, there we go. So that's good. But that got you, that wedded your appetite for the industry. The industry is great. I mean, you get to help people, serve them. besides God and family really money is pretty high up there. I mean, if you don't have money, you can't pay your bills, pay your rent. You can't donate.

It's something important that everyone needs. Yeah. And all within balance. And I know we could go on a tangent about that and talk for four and a half hours just on that one statement there alone. But yes, God, family, business, but all in balance. Because if you're out of balance on any one of those, then it's going to, you're going to cause issues. So let's dive into really who you serve. And when we say, how do you grow your money tax-free is that, are you serving the general public? Are you serving business owners?

And let's kind of define what does that really mean how to grow your money tax-free? We serve both business owners and then also W-2, people on W-2s. We love both people. there's a little bit more you can do with business owners than if you're just getting a W2 salary. The tax codes generally set up for structures of people who own LLCs, S-Corps, C-Corps, whatnot. Yeah. But both we can help both. And we started out with people in corporate America, heighten out worth earners in corporate America. Then we started shifting more into business owners.

And that's primarily who I work with today, but we have a sector in our company, a team. that still works with anyone in corporate America. Sure. So why is it, I mean, I know this might sound like a dumb question, but why is it so important to grow money tax-free? Because I think a lot of times people just get that out of college, get their job. They sign papers with the HR department.

One of them is a 401 something. I don't even know, but let me sign it anyway. I don't know about allocations and all that, but I'm just going to work. And then one day they wake up and it's like, oh, I've got a buck or two in this 401k account, but they don't realize that, you know, it's just a I owe you to pay taxes down the road. That's a good point.

And that is a lot of things that people think about. They're doing the hardest step, which is saving. I think that's the number one thing that prevents you from having some sort of wealth. But then they might neglect the idea that there is a tax bill coming or a tax. It is a tax time bomb at some point because you're either going to take it out or the government will force you. to take money out of the 401k through required minimum distributions. So the idea there is how do we mitigate that? How do we grow the money to where we can access it perhaps tax-free,

grow it in a tax-free environment? There's solutions for both people who are over the, let's say you make too much money to contribute to a Roth IRA, for example, which is what a lot of people do to grow their money tax-free and take it out tax-free. there are other solutions besides just that. But that's why you need to speak with the right professional who knows how to service the higher net worth. You know, I think that's a really interesting point. So number one, don't try to Google it and do it on your own.

You're not going to figure it out. Get with someone that knows. Number two, you really need to make sure that you realize that in certain accounts, you're growing your money, but it's never been taxed. when is the best time to pay the tax on that. Is it in your retirement? Question mark. And that's where someone can kind of give you some either or options. And there's, you know, probably there's not much in life that's a guarantee other than death and taxes. And probably if we pulled people on the street, do you think taxes are going to go up in the next five, 10, 15, 20 years before you retire? And everyone's going to say, yeah, because they know government spending, deficit, all of that

factors into that tax increase no matter what side of the aisle that you're on. So you mentioned Roth, that's a vehicle for some people. That is a wonderful vehicle. But then for others, like you mentioned, there's certain caps. And we don't need to get into specifics on what the caps are. But we know if you make too much, you know, you can't contribute or you can only contribute certain limits. What's another vehicle that you're working with your clients on to help them grow money tax

free? Yeah, it's a great. question. You know, the Roth IRA is a common way that you can grow your money tax free. There are other solutions out there. It's a case-by-case scenario. Really, it's a conversation where our actuary, our CPA, or tax attorney would sit down with the client and figure out with them the right solution or the right structure to do that. Sometimes you can do it through just opening up a trust for the client. Sometimes you can do it through life insurance. There's different strategies to accomplish the same method. It just depends on what's the right fit. How does it make sense for the client based off what they already have going on? So sometimes it's hard to give you a straight up answer until we see what the client actually is doing today.

Yeah, but I feel like people listening to what you just said there are breathing a sigh of relief because if you said, oh, well, the product is X, Y, Z, or the tool is this, and you need to, you know, get, now, in essence, you're fitting a square peg in a round hole at times because all you see is that product and anybody that comes across your path, you're going to sell them that product. What you just said was, we don't know. Let's see. Let's see what works best for you. Let's take your needs into consideration.

It might be this. It might be that. It might be the other thing. And I think that that's a big black eye in the industry these days. is certain people have their go-to products and who knows, you know, whether it's because of commissions or just they don't know anything about other products. But I really like how you approach that. It's like, let's sit down and ask some questions and see what the need is. And then we can make some recommendations.

That's a great point. If you're going to go out and just a normal advisor, a lot of advisors are cookie cutter. And that's where we wanted to separate ourselves from. If you just go to someone across the street who maybe is with a reputable brand, you know you're going to get good ideas. But there could be better strategies for your specific situation. But the biggest thing is I always tell people is don't just interview one. Go speak to a few because they're going to be handling one of the most important things in your life, which is your money. And if it's not handled right, you know, you could look back and after 10 years of working with you.

them have maybe not gotten the best results on the performance of your money or the savings on taxes that you could have gotten. And tax savings has an ROI to it. Yes, because it's that hole in the bucket. You know, you might be pouring that money in with the savings and investments and growth. But if there's holes in the bucket, like losses or taxes, now all of a sudden, that has a detrimental effect. And I like that you mentioned, you know, go across the street to whoever out there, whatever name that you've recognized from the 800 numbers or TV or the internet. And that might be a great option in your interviews to talk to people, but one limiting factor I've heard is then they only have certain products to recommend. And

someone like yourself, you're independent. You've got a plethora of things. And again, it just gets down to what's best for that client. Absolutely. And it's not only interviewing that one client, but seeing who they truly are as a person, getting to know them, are they honest? What are the experiences of the current clients that have worked with them? Will they fly out to meet you and handshake you? Because this is a lifelong relationship. They're becoming a business partner with you. And that's what you want to think of it as, not just as a transaction.

100%. So you mentioned some options could be looking at Roth and trust. which would involve, let's talk to an attorney. You mentioned life insurance, and I think that sometimes people go, wait a minute, hold on, life insurance, retirement, tax-free, that doesn't seem to add up. So talk a little bit about how a life insurance strategy factors into a retirement plan. A lot of it comes down to reading the tax code. Tax code 7702 is one. It's a pretty important one.

It's been around for a long time. The basics of it is people need life insurance. So you need to have life insurance on you for a specific purpose. Maybe it's because you are giving it to your wife if you were to pass away or your kids or your heirs or your charity. But what a lot of people don't know is if you have life insurance on you, you can literally take that life insurance and attach it to your already opened brokerage account

attach it to an investment of your choice and now it will allow the investment to grow tax-free. It's as simple as that. It's very easy. And then you have to pass some rules and look at it with your actuaries.

The rule is, is depending on the amount of life insurance on you, you are then allowed to put a certain amount of money into that investment, which would then grow with no taxes on that investment itself. Yeah. Wow. That, um, I think a lot of times people think,

oh, I saw late night TV that get X number billions and trillions of dollars of term life for a penny. And so I'm going to do that. And they think when I die, life insurance pays out. But I've heard that there's a. staggering low percentage of those term policies that actually pay out. So in this scenario that you're mentioning, doing it the right way with the right kind of life

insurance policy could really bring some of those growth as well as tax benefits. So what are some of those things that people need to keep in mind? Because I would say what's a misconception people have? Because I think I just articulated one as like, oh, I thought when you die, life insurance pays, but you're talking about it as a tool for retirement. Yeah, it's definitely a good tool because not only is it going to pay out if you pass away, which is the purpose of life insurance, but it allows you to have a tax-advantaged account that you can grow your money into.

Some people do it through guaranteed locations, sometimes whole-life policies that might have a guaranteed asset aspect to it, or they might have a little more risk with an IUL, or they might venture into VULs where you can actually own the stocks that you're purchasing. And then if you want to get to the highest level of it or the most advanced, you have your private placement life insurance policies

where we've been able to, I've seen some of our clients, you know, purchase real estate. And you can do different types of investments beyond just the market depending on the amount of life insurance you have on you. But again, all done through actuaries and attorneys to set that up properly. Don't try to do it by yourself.

Yeah, it sounds definitely like you don't just go Google and go click, click set up because there's parameters and limits and all of that. But you mentioned real estate. So as the cash value grows in these types of instruments, what are some other ways that you can use it because I think a lot of times people think, wait, I can access the money I've put in there because, you know, real estate, that's a big investment. What about college or buying a car or things, you know, like living expenses? Yeah, I mean, unlike a, I don't know, a 529 plan or a Roth IRA that you can't touch until 60 or 59 and a half or a 529 plan, if you're saving for your

kids education, you can only pull it out for specific purposes. There is no restriction. There's no 10% penalty tax. You can pull it out at any time, whatever the, let's say your surrender value is, has grown to, which is a very good benefit. You don't have to wait to a certain age, if you will. And again, it has to be designed correctly to make sure that it works. 100%. I think that's a big thing that people just hear something on the fly and go, oh, let me go and do that.

So making sure you're talking to the right person who's asking the right questions. And also it just sounds to me like when you're talking about reaccessing some of that for whatever purpose, real estate, college, whatever the case is, that's almost like a living benefit, not a death benefit. So, yeah, these have death benefits. If you die, there's a death benefit. But talk a little bit more about some of the living benefits that you can structure in as well. Yeah, there's a lot of living benefits in there. Again, how do you design it? What's the focus of it?

Is it for more maximum insurance to where you're just, you're paying only for the insurance? So you have as much going to your errors as possible when you pass away? Or is the focus going to be more toward pulling it out for retirement? And then if so, that's when you're more focused on getting the least amount of life insurance. But the maximum you can, so your cost is low. but to put the maximum you can into your investment or your growth strategy. And the living benefits are just the ability to take the cash out or to use that death benefit for whatever maybe a writer might say within the policy. And like some writers might even be for, like you hear about, you know, 70% of us will all one day potentially need long-term care.

kind of long-term care, which can be astronomical. So if you wanted to, you could pay for it out of pocket that costs a lot of money. If you wanted to, you could buy a long-term care policy. That could cost a lot of money. But also, you could add a writer to these and then that could take care of it. But if you never need a long-term care, then it still sits there in your plan. So I've heard some of those benefits are helpful too. those are great benefits the long-term care option with some of them if you if you if you put that inside of your policy

if you get sick injured disabled or have a reason long-term care-wise to pull the money out and use that would just be subtracted from your death benefit in most cases that can be applied to that situation so so there's more than one way you can actually use the life insurance itself before you pass away. Not only is there the cash value, but there is the life insurance you can pull from.

Yeah. So really versatile. So can you think of a client you've worked with that provided some of these things, maybe a success story where they maybe were a little confused on how that would work? And then when you explained it and put it in place, it really opened up opportunities for them. Yeah, absolutely. I think the biggest, so the reason a lot of people use it with us, is because they're higher net worth clients

who've already maxed out their 401Ks. They've already put money into their Roth or they can't put money into a Roth because they make too much money for that. But they're looking for another vehicle to grow their wealth, to continue to grow, but also have access to

for not only emergencies, but opportunities. One client that we are working on currently was I said, hey, what if I could propose the idea to you that hypothetically, you know, nothing's guaranteed, of course, but we could get your return closer to a 15% return every year. And he's like, whoa, that sounds interesting. How does that work? So I explained to him, all right, so let's assume the market makes 10% every year, the S&P 500. The last 10 years has done pretty well. If that is the case and you were in the stock market, and that's what you had, maybe you purchased the S&P 500 index to some level. What a lot of our clients like to do is leverage their money in a safe capacity. So they will have their 10% of their money inside of their insurance policy growing at what the index of the 500 would do. they would borrow the money out at a smaller discounted interest rate,

go purchase another investment for themselves. We've got other, I mean, we have alternative funds that we can direct clients into that are making anywhere from 10 to 13% in a year. So if you're making, let's say, 10% in an alternative fund, your S&P 500 fund made also 10%. Well, you just made 20% return. But if your cost of that loan to take the money out was 5%, subtract 20 months 5, you're netting 15. So that is how you, and you plug that into a compounding interest calculator, a 15% growth versus a 10%.

Your mind would be blown. You would just look at that in your eyes and just wide open and say, wow, why didn't I do this sooner? Today's the day to start. Yeah. and all under the umbrella of a really protected safe instrument called a special type of life insurance that guess what has not been just popped up in the last couple years. This strategy has been around for over 100 years, right? Absolutely. And it's all just modeling what the most successful people have done and copy and pasting it into your life.

And then therefore you can do and replicate what they have. There's no like hidden secret about any of this. Yeah, success leaves clues. So see what other people have done and apply it to your life. And then now once you've got all this dialed in, how does the cash and the insurance transfer over to like family members at the time of death with your beneficiaries? The good news about insurance is there's no taxes on when it pays, pays out. So it goes to your family and your air is tax-free. So then if you had in your will or in your trust, you could start the whole cycle back over.

Then the money just goes right back and buys the insurance on the air that you left. On them. Yeah. So it's just a really interesting, powerful concept because most people think go to work, get a 401K or invest in a Roth or the traditional things, but you're opening up operational. to see if that may possibly be a vehicle for consideration. So I think that is so neat, Ethan. And if someone is hearing this thinking maybe let's kind of see what that would look like in my scenario, what's the best way they can learn a little bit more and reach out and connect with you?

Yeah, the best way to contact us is you can either give us a call or you send us an email. And maybe we can put that in the description, Mike, our email or contact us. in Phil. Yeah, and we can also put a link to your website in there as well. I appreciate that. Excellent. Well, thank you so much for coming on. It's been a real pleasure talking with you today.

You as well. Thank you having me on your mic. It was a great time. You've been listening to Influential Entrepreneurs with Mike Saunders. To learn more about the resources mentioned on today's show or listen to past episodes, visit www. influential entrepreneurs radio.com.