Where to store rental reserves?

[Adam Widder]

We're going on 3 properties, and I'm wondering where others store their reserves for their rental properties? My general rule of thumb was 6 months of PITI, which I have in a savings account. As we go to 3 properties, this amount is now enough to purchase another property! So there has to be a better way to store this money.

So far I've been researching putting it into a:

high yield savings account, very boring, very low yield, very safe, and can be withdrawn quickly.

Mix of a stock/bonds in a taxable investment account, shoot for a 4-6% return. Better return, liquid, but if i needed the money, I'm taxed.

Infinite banking. My understanding is I could over time, fund the policy annually, have a cash balance I'm able to use right away, have an immediate death benefit, and it gains 4-6% growth, and I can take a loan against it.

[Jody Sperling]

I am not an insurance salesperson. I've never been licensed in health and life, and none of the below is advice, but a slice of my experience. I  own and use whole life policies, and I couldn't be happier.

The fact that you listed infinite banking is game-changing. It can be so frustrating to try explaining why high cash value whole life insurance policies are so powerful. Initially, it puts a small drag on your cash reserves and cash flow, but when the system is at full efficiency, after the third year you have such a profound advantage over other investors. 

Any year could theoretically prove this wrong, but my policies have been averaging 6.5% growth after factoring in the dividend. 4% of that is guaranteed, so even if the insurer had a terrible year, I'm 100% certain I get my money. And loans are liquid and easy to get ahold of if you need them to pay for emergencies.

Remember how people were pissed at Elon Musk because he was living on loans from the growth of his stock in Tesla and therefore not paying any taxes? Well, you can do the same thing with your life insurance policy and you don't have to be a billionaire. Remember how Bill Gates lost half his earthly possessions when he divorced Belinda. Well, he'd've been shielded from that loss if it was held in a whole life policy. Remember how companies lose everything when they file bankruptcy? Well, if they have whole life policies, the money can't be surrendered or taken. (Check some of these claims as rules vary state to state, but it's sufficient to say, the protection offered by policies is another great reason to love them.)