If you’re tired of paying high-interest rates on your loan, banking, and credit fees, this is the guide for you. Learn how to be your own bank with infinite banking!

Picture this – you, owning your own private bank. Flaunting financial independence and controlling the money that you make. No longer worrying about external banks, fees, arduous policies, or interest rates – what if you can make this dream a reality? Here’s where infinite banking comes in.

Infinite banking, also known as the Bank On Yourself concept, is a personal financial strategy that allows you to become your own banker. It works by taking out a whole life insurance policy and using that to build up cash value over time. By borrowing from the policy, you can access money without an external lender. In essence, you are taking out a loan from yourself and paying back with interest. Imagine that!

This strategy was introduced By Nelson Nash in 1980, who sought to revolutionize the banking industry. His strategy was simple – “Be your own banker”. As Nash puts it, “It is not a product; it is an idea or concept of how to use certain kinds of products…to one’s advantage in pursuit of financial independence.” (Nash, 2018).

Benefits Of Using Infinite Banking As Your Personal Banking System

There are plenty of advantages to setting up your own personal banking system with Infinite Banking. These benefits include

1. Financial Security:

One of the most important benefits of using Infinite Banking is that it provides financial security and stability. According to experts, people who use Infinite Banking are able to save more money, pay off debt faster, and have more money in their emergency fund. This can provide peace of mind knowing that your finances are secure.

2. Tax Benefits

Infinite Banking also offers tax benefits due to the plans’ ability to accumulate cash value in a tax-deferred environment. This provides you with more financial flexibility since you can access your policy’s cash value when needed while avoiding the tax burden that comes with taking out a loan.

3. Flexibility

Infinite Banking also offers flexibility since you can customize your policy to meet your individual needs. You can adjust the premiums and coverage amounts, or change the provisions of the policy if needed.

4. Investment Opportunities

With Infinite Banking, you have access to a loan that you can leverage to buy a variety of investments such as Real Estate, stocks, bonds, and mutual funds. This allows you to diversify your portfolio and maximize returns on your investments.

5. Liquidity

Another great benefit of Infinite Banking is its liquidity. You can easily access your funds when needed, without worrying about lengthy approval processes or waiting for the bank to process your loan application. You can borrow from yourself as needed and pay yourself back with interest.

6. Return on Investment

With Infinite Banking, most people leverage infinite banking to buy income-producing assets like Real Estate and other investments. You earn a return on investment since you are both borrowing and lending money to yourself at the same time plus a dividend from the mutual insurance company as you become one of the mutual insurance company’s owners when you become your own banker with them. This means you can earn interest on the money you borrow and a return on any investments you make with the loan.

7. No Fees or Penalties

Unlike traditional banking systems, there are no fees or penalties associated with Infinite Banking. This makes it an attractive option for those who want to avoid high fees and penalties associated with traditional banking systems.

8. No impact on Credit

Another benefit of Infinite Banking is that your loan is not reported to credit bureaus since you’re actually borrowing from yourself. Thus, it has no negative effect on your credit score. 

Using Infinite Banking as your banking system can provide numerous benefits that traditional banking systems cannot. With its flexibility, liquidity, and potential tax benefits, Infinite Banking can be a great way to secure your financial future.

Drawbacks Of Using Infinite Banking

1. Time:

When starting out, you might not have a huge cash reserve that you can borrow from. This can make it difficult to get the ball rolling when you want to use Infinite Banking. Your cash value takes time to accumulate unless you put a lump sum of money into your policy.

2. A Bit Expensive:

Whole life insurance is expensive compared to Term- Life insurance because of the cash value built into it. Most people find whole life insurance too expensive if not understand how it works. 

Do You Need to Have a Large Sum of Money to Start Infinite Banking?

No! Despite the name, Infinite Banking does not require an infinite amount of money. While it is true that larger funds can generate more returns and build cash value quickly, you can start Infinite Banking based on your budget. As your financial position grows, so can your Infinite Banking portfolio. To get started, you need to open a whole life policy with a reputable mutual insurance company. Allocate some funds to the life insurance policy, and you can start taking advantage of Infinite Banking’s many benefits by building cash value inside your policy.

A great thing about Infinite Banking is that it’s flexible. You can adjust your contributions as needed, making it an ideal option for people who may not have a lot of money to invest upfront. You can also increase or decrease the amount of money available for withdrawals as needed, making it a great choice for those who need access to their funds in case of an emergency.

How To Get Started With Infinite Banking

If you’re interested in becoming your own banker, here are some steps to get started:

1. Familiarize Yourself with the Basics of Infinite Banking:

Before getting started, it is important to understand the basics of infinite banking discussed in this article. Read up on the concept to learn how it works and decide if becoming your own bank is your best financial decision.

2. Consult with a Licensed Financial Professional:

Depending on your goals and current financial situation, speaking with a licensed financial professional who is familiar with the concept of infinite banking can help guide you in the right direction. They can assess your needs and determine how using Infinite Banking could be beneficial to you. Schedule a free consultation here

3. Choose the Right Insurance Product:

Once you have a good understanding of how Infinite Banking works and you’re ready to get started, we recommend working with a licensed Financial Professional here who will help you in choosing an insurance product suitable for you. We will help you research different products available and compare features, costs, and other factors that are important to you.

4. Open an Account or Set Up a Policy:

Once you’ve chosen your insurance product and determined it is the right choice for you, it’s time to work with your financial professional to submit a policy application to see if you will be qualified. Your health plays a big role in determining your policy. 

5. Start Building Your Bank:

Once your application gets approved, it’s time to begin building your own bank by making regular contributions and withdrawals as necessary in order to maximize the benefits of Infinite Banking.

Infinite Banking can be a great way to take control of your finances and become your own banker. As long as you are committed to learning about the concept, familiarizing yourself with different insurance products available, and making regular contributions to your account or policy, you can be well on your way to becoming the master of your financial future.

Infinite Banking concept


How Infinite Banking Works

Using whole life insurance to build cash value and borrow against your cash value without your money leaving your account.
You start by getting a whole life insurance policy specifically designed for Infinite Banking. You start paying your premium, huge amount from your premium goes into the cash value component of your policy and some for life insurance (Protection for your loved ones if you die too soon and protection against lawsuits and creditors). Each time you pay your premium your cash value grows plus money in your cash value is working for you, earning guaranteed interest and dividends as you become one of the owners of the mutual life insurance company when you buy your policy from a mutual insurance company. You can loan against your cash value provided your policy already accumulated cash value. Your loan interest is usually lower than the guaranteed interest and dividends you earn on your money and since your money is still in your account, it continues to grow compounding interests. Your loan is taken out without a credit check as this is your own private bank. For example, You have $20,000 saved up for a car. You can first put that money in your infinite banking to increase your cash value and borrow against it to buy a car. Remember that your money didn’t leave your account so you continue to earn interest and dividends and your money continues to grow tax-free. If the loan isn’t paid back by the time you die, the loan will be taken out of your death benefit. We are happy to help, book a free and confidential financial consultation here


How to fully take advantage of infinite banking

Make sure to buy your policy from a mutual insurance company
Make sure to take a loan against your policy when you accumulate enough cash value

The Different Types Of Accounts You Can Open Through Infinite Banking

By now, you must have learned that Infinite Banking is a strategy to help you become your own banker by utilizing cash-value life insurance policies from a dividend-paying mutual insurance company. 

Furthermore, this system takes the banking functions traditionally performed by banks, such as lending money to yourself, investing, and liquidating investments, and puts them into the control of an individual rather than an institution. As with traditional banking, there are a variety of accounts that can be opened through Infinite Banking.

The most common type is the whole life insurance policy, which functions as a savings account, allowing individuals to save money over time and earn interest and dividends on their investments. In addition to the cash value growing tax-deferred, whole-life policies also provide a death benefit that can be used to help protect your loved ones.

Other types of accounts available through Infinite Banking include savings and investment accounts, as well as credit lines and loans. Credit lines are typically secured by the cash value of your life insurance policy, allowing you to borrow against it without incurring additional debt or paying fees or interest. On the other hand, loans are usually unsecured and can be used to fund investments, pay for college tuition, or cover emergency expenses.

By utilizing these different types of accounts, Infinite Banking allows individuals to become their own bankers and take control of their finances. It’s important to remember, however, that this type of whole life insurance policy is specifically designed for infinite banking. A whole life insurance policy can be designed to meet different needs so be sure to let your agent understand your need. 

Tax Implications of Infinite Banking

When it comes to taxes and Infinite Banking, there can be some confusing questions, such as

Are Life Insurance Premiums Tax Deductible?

The good news is that the answer to this question is generally no.

Life insurance premiums are not tax deductible. The exception to this rule is if the life insurance is a business expense or if the beneficiary is a charitable organization.

It’s important to always check with an experienced tax professional or accountant before taking any action with regard to taxes and Infinite Banking, as laws are subject to change and may vary from state to state.

Does Infinite Banking Hold The Privacy Aspect of Using Whole Life insurance?

Absolutely! Whole life insurance is a private contract between you and the insurance company, with no one else involved. You are in control of your money, so there’s no need to answer to any outside party or worry about what they might do with your funds. Plus, this type of account provides guaranteed growth and zero market volatility (meaning you get a guaranteed interest rate and no loss ever. You can rest assured that you will always be able to make the most of your investments without worrying about any potential losses.

Ultimately, this means that your loan isn’t reported to the credit bureaus.

Can You Lose Money In Infinite Banking?

No. Infinite banking does not involve any risk of losing money, since it is designed as a safe and secure way to manage one’s finances. In this system, your money is always accessible to you if you have already accumulated cash value.

The Safety growth component of using whole life insurance as an investment vehicle helps you avoid the risk of losing your hard-earned money to the market crash. Additionally, whole life insurance policies offer protection by a death benefit, so if something were to happen to you, your beneficiaries would receive tax-free cash minus any outstanding policy loans.

Do Companies Use This Method To Sustain Their businesses?

Yes, they do. Whole life insurance is a concept that has been embraced by many businesses as an effective way to sustain their operations. This strategy allows companies to be in control of their money. By doing this, businesses can access funds whenever they need them and have greater control over their money.

Additionally, this strategy can help businesses save money on banking fees and interest payments.

Companies that have successfully implemented infinite banking strategies include restaurants, retail stores, auto dealerships, and e-commerce sites. Famous entrepreneurs like J.C. Penney, Walt Disney, Ray Kroc, Jim Harbaugh. By taking advantage of this method of financial management, these companies were able to sustain their businesses.

Infinite banking also provides businesses with more flexibility in terms of cash flow management. By keeping money in their whole life policies, companies are able to fund their businesses whenever they need to, without a credit check,  this also helps eliminate waiting time. This strategy can be especially beneficial for companies that experience volatile cash flow, as they can loan from their whole life insurance policy when necessary.

How Banks Put Their Money In Whole Life Insurance?

According to most banks put money in life insurance. Banks invest in a special kind of whole life insurance called Bank Own Life Insurance  BOLI. This type of policy is an effective way for banks to ensure their money grows safely and securely. It also enables them to access the cash value of the policy should they need it in the future.

When investing in BOLI, banks buy a permanent life insurance policy on employees or executives that have good health ratings. The bank pays a premium and the money goes into the policy’s cash value. The cash value grows at a rate predetermined by the insurance company and is available to be borrowed against should the bank need it in the future.

When done correctly, investing in BOLI can be an effective way for banks to grow their capital while also providing an additional layer of security and financial protection for their employees.

Overall, banks use BOLI as an effective way to store and grow capital, providing them with access to cash should they need it in the future. It also provides an additional layer of financial protection for those that are insured under the policy.

Why Do The Wealthy Use This Method?

The wealthy use this method because it allows them to take advantage of taxes on their investment. Infinite banking leverages the power of whole life insurance, which offers a cash value that can be accessed while still alive. The death benefit is used as collateral for loans or income in retirement. The death benefit minus the loan is paid out tax-free to the insured beneficiaries after the insured passes away if the loan wasn’t repaid. 

Additionally, the wealthy loan money from their whole life insurance policy to buy income-producing assets like Real Estate and /or invest in other things like Stocks, buy more company shares, and sustain their business.  Tax benefits associated with these policies mean that more money is available for investing and can be used to increase wealth at a faster rate than traditional investments. By taking advantage of all the advantages offered by whole life insurance, the wealthy can secure their financial future.

Final Thoughts

The concept of Infinite Banking can be a bit overwhelming at first, but with the right advice and guidance, you too can become your own bank! By understanding how money works, and how whole life insurance can be used to help you build risk and tax-free wealth, you can start taking control of your finances. 

Not only will this provide you with more long-term financial stability, but it can also help you to build tax-free wealth that can be handed down to your descendants. All in all, Infinite Banking is a great way to make sure that your money works better for you.

 Start building your own wealth today. Schedule a free and confidential financial consultation here

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