Do What the Ultra-Wealthy Do to Build Wealth and Protect Your Family with Joseph Francis Lombardi

Joseph Francis Lombardi begins by describing a childhood marked by severe poverty and instability. He says his mother was an addict, wanted to kill him before he was born, and later took his father’s assets, leaving the family with nothing. After moving from Florida to Connecticut, he says they lived in an attic, used a bucket as a bathroom, and survived on foods such as noodles and eggs. He also recounts dying in Cancun at age 12 and being brought back to life. Those experiences shaped his belief that he is important and that each day is a blessing. Because he feels he is living on “borrowed time,” Lombardi says work does not feel like work; it feels like a privilege to serve other people. He argues that people should tell themselves they are worthy and address the emotional void left by childhood trauma, bullying, and school experiences. He contrasts the common question—how to do less and get more—with the question, “What could I do more to get less?” In his view, serving others without making everything transactional allows God to fill the resulting void “tenfold.” He says he now feels fortunate to get up early, take his daughter to school, and serve 10 to 15 millionaires a day through Zoom meetings.

The host introduces taxes as a major threat to wealth creation and notes that he once paid seven figures annually in California before moving to Puerto Rico, where he says he now pays 0%. Lombardi responds that the government is not a friend to wealth builders. He gives a historical account—without presenting supporting documentation—claiming that income taxes were optional in 1913 and that mandatory rates rose from 7.5% to 77.5% within 48 months. He then argues that Wall Street and government rules shifted risk onto individuals. According to Lombardi, 401(k)s once offered tax-free treatment and guaranteed returns, but later changes replaced pensions with accounts in which workers assume investment risk. He claims investors pay Wall Street during accumulation and then face federal and state taxation of roughly 30% to 45% when withdrawing money, leaving them with less than a quarter of what they contributed. Lombardi also criticizes the advice to pursue deductions, arguing that an immediate tax saving can merely defer a larger liability. He says ordinary people are not taught to question these arrangements because schools, teachers, accountants, and CPAs often encourage government-approved retirement accounts and deductions. He uses a football coin-flip analogy to suggest that favorable framing can conceal what a recommendation actually means. His broader conclusion is that entrepreneurs should evaluate who controls their money, what risks they assume, and what taxes will apply later.

Asked how ultra-wealthy people preserve, deploy, and grow wealth, Lombardi says they do not primarily invest through government-linked retirement structures. He identifies three assets that he says commonly appear in billionaire portfolios: real estate, annuities, and permanent life insurance. In particular, he highlights Index Universal Life policies and the Internal Revenue Code section 7702, which he says is embedded in permanent life insurance policies. He says whole life was more popular about a decade earlier, but higher interest rates have made indexed universal life more attractive in his view. Lombardi argues that insurance companies can be used as wealth-building vehicles even though consumers often associate insurance with expenses such as auto, workers’ compensation, homeowners, and umbrella coverage. He says insurance companies must keep policyholders’ dollars in a general account rather than lending them out in the same way banks do, and he claims that policyholders have not lost money held by insurance companies over the past 180 years, including through wars, the Great Depression, and the AIG crisis. He contrasts this with banks and points to bank-owned life insurance as evidence that banks themselves use life insurance. He also cites real estate and life insurance as assets that can be borrowed against. The host and Lombardi mention the so-called “Pelosi strategy,” in which investors once attempted to mirror congressional stock trades, although Lombardi notes that this approach was subsequently stopped. His practical recommendation is not to invent a new system but to study and copy structures used by wealthy people.

Lombardi expands on the idea of becoming one’s own source of financing by comparing tax-free growth with tax-deferred growth. He refers listeners to two Forbes articles about a wealthy person’s Roth strategy, one written by a CPA and one by a financial planner. He gives a hypothetical example involving a $50,000 contribution in 2026: the investor might describe a $15,000 tax reduction as savings, but if the money grows for 25 years at approximately 7.2%, Lombardi says it could grow to roughly $320,000. At a claimed future tax rate of about 40%, the withdrawal could create a tax bill of approximately $124,000. His conclusion is that a deduction today may simply postpone taxation until a time when rates are higher. He points to government debt, saying it rose from $25 trillion to $40 trillion in roughly seven years, and argues that the country has only two ways to address it: hyperinflation or increased taxation. He also warns about estate taxes. A $10 million 401(k), he says, could face a 40% tax at death if it exceeds the applicable threshold, which he says has changed from roughly $2 million under Biden to about $15 million “this year.” The host echoes the concern that families can spend decades saving for children only to leave them a tax problem. Lombardi’s central message is that entrepreneurs should account for future income taxes and estate taxes rather than judge a strategy only by its immediate deduction.

For a concrete protection strategy, Lombardi describes using fixed indexed annuities and indexed universal life. He says some of his clients use fixed indexed annuities because they can participate in market gains while avoiding losses, and he claims certain annuities averaged more than 20% annually over the previous 10 years. He emphasizes that the specific approach depends on the client, but says annuities can provide guaranteed income for life, a death benefit, probate avoidance, long-term-care “doublers,” and beneficiary protection. He gives the example of a 74-year-old man and 65-year-old woman in Connecticut who had $4 million in a David Lerner IRA. Their goal was to leave the money to their two sons. Lombardi says he proposed placing the $4 million into a twin-income annuity, paying taxes that would otherwise be due, and directing the resulting income into a life insurance policy. The policy would be held in an irrevocable life insurance trust, or ILIT. He presented this as a way to turn an expected taxable inheritance of roughly $6 million into a claimed $12 million tax-free benefit for the children. Lombardi says the trust removes the policy from the estate and can avoid estate taxes. He summarizes the philosophy as: “It’s not about what you own, it’s about how you own.” He argues that the account, policy, trust, or other “container” holding an investment can matter more than whether the underlying asset is Apple, Nvidia, Bitcoin, gold, or silver. He also claims that properly structured assets can offer protection from creditors, divorce in some states, and market losses, while still allowing loans against the value.

Lombardi directs listeners to LearnWithHawk.com, saying Iron Hawk Financial operates nationally and has agents in almost 50 states. He says he has written three five-star-rated books and hosts a podcast called “Wealth Talk with Iron Hawk.” Visitors can receive his podcast, webinar, books, and the two Forbes articles he referenced. He says there is no charge to clients for his work and claims he has never charged a client in 24 years or lost a client dollar in that period. The first step, according to Lombardi, is a free intake or fact-finder covering assets, income, liabilities, time horizon, budget, goals, life insurance, disability coverage, long-term-care coverage, wills, trusts, children, marital status, company value, and the business exit strategy. His team would then prepare a customized plan based on the structures he associates with wealthy people, allowing the listener to compare it with their current arrangements. The host closes by repeating that entrepreneurs often work hard to earn money but fail to structure or protect it as inflation reduces purchasing power. He tells listeners that they are shaped by the five people with whom they spend the most time and says they have been “hanging out” with him and Lombardi. The episode ends with the call to action to visit LearnWithHawk.com and with additional reminders for HighLevel and The Foundation.