WHAT IS
INFINITE BANKING?
Simply, it's Overfunded Whole Life Insurance
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So, Why Overfunded Whole Life Insurance?
We emphasize the importance of overfunding when setting up your policy. In traditional financial planning, whole life insurance is structured to provide the largest death benefit at the lowest cost. However, with overfunded whole life insurance, the goal shifts to maximizing living benefits while minimizing the death benefit.
This strategic approach is ideal for those who want to utilize their life insurance as a dynamic financial tool during their lifetime—not just as a benefit for their heirs.
When properly designed and managed, overfunded whole life insurance becomes a powerful foundational asset for your financial strategy. It grows your wealth consistently over time, provides essential protections (including a death benefit), and gives you the flexibility to access your money as needed.
Explore the comparison below to see how Infinite Banking differs from a traditional whole life insurance policy and why it’s a game-changer for building financial security.
How Specially Designed Whole Life Works Different Than Regular
With Specially Designed Whole Life
High Early Cash Value
Liquid ( Early)
Private (Flexible Premium Payments)
Tax Advantages (Able To Use While Alive)
Growing Death Benefit
Safe (Competitive Returns)
With Regular Whole Life
High Fees
Lacks Early Liquidity
Low Long-Term Growth
Mandatory High Premium Payments
Very LOW Returns Early on Cash
No control over your money
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Let's Understand How Infinite Banking Can Work Throughout Your Life
Uninterrupted Compounding
Traditional financial strategies often lose momentum due to what we call the four compound killers: taxes, fees, market volatility, and the loss of growth when capital is used.
Infinite Banking eliminates these obstacles, allowing your money to grow continuously. Your wealth is shielded from these common disruptions, ensuring true, uninterrupted lifetime compounding.
This approach empowers you to steadily build and preserve wealth, providing a secure foundation for your financial future. It’s a strategy designed to protect your money while maximizing its potential.
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Infinite Banking not only provides uninterrupted, lifetime compounding but also gives you the flexibility to access your capital when needed through a built-in collateralized loan feature.
This isn’t just about storing money—it’s about putting your money to work for you. Enjoy the dual benefits of financial growth and liquidity, much like a high-yield savings account but with the added advantages of life insurance.
Access your funds for a variety of purposes—whether it’s seizing opportunities, covering emergencies, or fulfilling financial goals—without interrupting your long-term wealth-building potential.
With Infinite Banking, you have the control to grow and use your wealth on your terms while securing a financially sound future.
Plan for the Future of Taxes
Do you think taxes will go up or down in the future? If you answered "up," we agree. If you think they’ll go down, take a look at the national debt clock and reconsider.
Infinite Banking offers a strategic hedge against future tax increases:
Tax-Deferred Growth: Your investments grow without immediate tax impact.
Tax-Free Access: Access your funds tax-free throughout your lifetime, in accordance with Section 7702(a).
Income Tax-Free Legacy: The death benefit is passed on to your estate and beneficiaries free of income tax and without the delays of probate.
Much like a Roth IRA, you won’t get a tax deduction upfront, but once your capital enters the policy, it grows tax-free, and you won’t pay taxes again if managed correctly. By paying taxes now at potentially lower rates, you secure yourself against the risk of higher taxes in the future.
This is why Infinite Banking is such a powerful financial strategy—it helps you keep more of your money working for you, now and in the future.
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Give Your Dollar More Than One Job
Infinite Banking isn’t just a savings strategy—it’s a versatile tool for your money. Think of it like your smartphone, which does far more than make calls or send texts. Infinite Banking is the 'smartphone' of your financial strategy, giving your money multiple roles to play.
Secures Lifetime Growth: Your wealth grows steadily and uninterrupted.
Puts You in Control: Access and use your money when and how you need it.
Ensures Future Cash Flow: Plan confidently for financial goals and opportunities.
Safeguards Your Legacy: Protect your assets and ensure they are passed on securely.
Infinite Banking is designed to do more than one thing. It’s a multi-functional approach to building and using your wealth, helping you maximize your financial potential and long-term well-being.
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Infinite Banking not only protects your loved ones with a death benefit but also offers valuable benefits while you’re still alive. It’s a financial tool that supports you in both expected and unexpected moments of life.
Living Benefits: Access built-in riders like chronic illness and accelerated benefits.
Coverage for the Unexpected: Be prepared for life’s uncertainties with additional support.
Financial Flexibility: If you face a terminal illness or lose the ability to perform daily activities, these riders let you access your death benefit while you’re still alive.
Infinite Banking provides financial security and flexibility when you need it most, ensuring peace of mind for you and your family as you navigate life’s challenges.
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Infinite Banking can be a powerful addition to your retirement strategy, offering flexibility and security for your financial future. Research shows that properly structured whole life insurance can provide a more effective diversification tool than bonds for retirement planning.
Maximize Retirement Potential: Leverage unique features to increase cash flow during retirement.
Protect Your Savings: Ensure your retirement funds remain secure, no matter the market conditions.
Tailored Strategies: Access financial solutions designed to meet your specific retirement goals.
With Infinite Banking, you can build the retirement you’ve always envisioned. Discover how this approach can elevate your retirement strategy and provide peace of mind for the years ahead.
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Unlocking the Power of Infinite Banking Life Insurance: A Comprehensive Guide
What is Infinite Banking Life Insurance? An Introduction
Infinite Banking Life Insurance is a financial concept that transforms the way individuals think about life insurance and personal finance. Utilizing specially designed whole life insurance policies, proponents of Infinite Banking aim to create a self-sustaining financial system that allows them to borrow against their policies while generating cash value. This system not only serves as a safety net but also acts as a powerful wealth-building tool. As with any financial strategy, understanding the finer details, including its origins, pros and cons, and operational mechanics, is crucial. In this article, we will delve into the various aspects of Infinite Banking Life Insurance, providing you with the information necessary to make informed financial decisions.
The Origin and Concept of Infinite Banking Life Insurance
The concept of Infinite Banking was popularized by R. Nelson Nash in his book "Becoming Your Own Banker," published in 2000. Nash’s idea stemmed from a desire for greater financial independence and security. He introduced the concept of using whole life insurance policies as a way to create a personal banking system.
Key Concepts Behind Infinite Banking
Whole Life Insurance: Unlike term life policies, whole life insurance provides lifelong coverage and includes a cash value component.
Cash Value: Over time, part of the premium payments contributes to the cash value, which grows tax-deferred.
Dividends: Many whole life policies pay dividends that can be reinvested to grow the cash value further.
The underlying principle is that individuals can leverage the cash value of their life insurance to finance various personal and business expenses, effectively becoming their own bankers.
The Pros and Cons of Infinite Banking Life Insurance
Like any financial strategy, Infinite Banking has its advantages and disadvantages. Understanding both sides can help you decide if it aligns with your financial goals.
Pros
Tax Advantages: The cash value grows tax-deferred, and loans taken against the policy are generally not taxable.
Financial Independence: Individuals can self-finance purchases rather than relying on traditional lenders.
Wealth Building: The cash value can be borrowed against to invest in opportunities, facilitating wealth creation.
Death Benefit: In addition to cash value, the policy provides a death benefit for beneficiaries.
Cons
Complexity: The strategy can be complicated and may require extensive knowledge of life insurance.
Costs: Whole life insurance premiums are typically higher compared to term life insurance.
Time Commitment: It may take several years for the cash value to accumulate and yield significant benefits.
Loan Repayment: Loans must be repaid with interest, or the death benefit may be reduced.
Breaking Down the Infinite Banking Life Insurance Process
Understanding the process of Infinite Banking is essential for effectively utilizing this strategy. The process can be broken down into several key steps:
Step 1: Purchase a Whole Life Insurance Policy
You need to acquire a specially designed whole life insurance policy that emphasizes cash value accumulation. This policy should be from a reputable insurance company known for its stability and dividend payouts.
Step 2: Build Cash Value
Over time, your premium payments will contribute to the policy’s cash value, which grows based on factors like dividends and interest rates.
Step 3: Borrow Against Cash Value
Once sufficient cash value has accumulated, you can borrow against it to finance expenses or investments, with the policy acting as collateral.
Step 4: Repay Loans Wisely
As with any loan, it's essential to have a clear repayment plan. Loans not repaid will reduce the death benefit and could potentially create tax liabilities.
How Does Infinite Banking Life Insurance Work?
Infinite Banking Life Insurance works through a self-reinforcing cycle of cash value accumulation and borrowing. The mechanism is fairly simple: 1. You pay premiums, a portion of which contributes to the cash value. 2. The cash value grows over time, influenced by dividends or guaranteed interest. 3. You can borrow against the cash value for personal or investment needs. 4. As you repay the loan, the cash value replenishes, allowing for continued borrowing. This repeated cycle creates a form of personal finance that can function much like traditional banking systems but with the added benefit of insurance protection.
Benefits of Using Infinite Banking Life Insurance
The benefits of Infinite Banking Life Insurance go beyond traditional life insurance:
Liquidity: The cash value is accessible, allowing you to fund opportunities as they arise.
Control: You control the borrowing process, including how much to borrow and when to repay.
Protection: Life insurance offers death benefit coverage, ensuring loved ones are financially secure.
Flexibility: Policies can be adjusted to meet changing financial needs over time.
Potential Drawbacks of Infinite Banking Life Insurance
Despite its benefits, there are potential drawbacks to consider:
Duration: The cash value typically takes time to grow, eliminating the strategy for those with immediate financial needs.
Overhead Expenses: High premiums can strain budgets, especially if financial circumstances change.
Variable Returns: Cash value growth relies on dividends, which are not guaranteed and can fluctuate.
Roles and Responsibilities in Infinite Banking Life Insurance
Engaging in an Infinite Banking strategy involves various roles and responsibilities:
Policy Owner: Responsible for premiums, borrowing, and managing the policy.
Insurance Company: Provides the policy, manages cash value growth, and pays out death benefits.
Financial Advisor: A knowledgeable advisor can guide you through the complexities of setting up and managing the strategy.
Understanding the Tax Benefits of Infinite Banking Life Insurance
One of the significant advantages of Infinite Banking Life Insurance is its tax benefits:
Tax-Deferred Growth: The cash value accumulates without incurring taxes, allowing for more substantial growth compared to taxable accounts.
Access to Loans: Loans taken against the cash value are not considered taxable income, provided the policy remains in force.
Death Benefits: The death benefit paid out to beneficiaries is generally tax-free, providing financial security without a tax burden.
Conclusion
Infinite Banking Life Insurance presents a unique opportunity for individuals seeking financial independence and wealth-building strategies. By leveraging whole life insurance policies, you can create a self-sustaining financial framework that promotes smart money management while providing essential insurance coverage. However, as with any financial strategy, it’s imperative to weigh the pros and cons carefully. Engaging with a knowledgeable financial advisor and understanding your own financial goals will be critical in determining whether Infinite Banking is the right approach for you. After all, informed decision-making is the cornerstone of successful financial planning.
We’ve Created A Calculator To Help You See How Much Potential Cash Value You Could Have In The Future
The Infinite Banking Difference
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Frequently Asked Questions
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How soon can I borrow against my whole life insurance policy?
When you properly structure whole life insurance intended for cash value growth, which we are experts at, you can borrow against your policy roughly 30 days from starting your policy. In some instances it can be even sooner but this is a good number for safe expectations.
What if my health is bad? What if I am too old for this Policy?
If you are older and or have health concerns there are options for you. Please watch this video as it gives you a more detailed response for all of those options.
This sounds too good to be true, why haven't I heard about this before?
Some would say if it sounds too good to be true, it is. But the reason why most have never heard of this concept is because it is not taught in formal financial education. It also isn't offered in standard jobs as a retirement plan. The banks want you to store your capital with them causing life insurance to get a bad wrap as it is misunderstood when it is designed properly for cash value growth. The banks and institutions tell us to store our money with them while simultaneously storing billions of dollars into Life insurance for multi dimensional uses.
What is your response to Dave Ramsey on permanent life insurance?
Dave Ramsey has provided a ton of value to many families. Dave Ramsey is not for everyone just like the And Asset isn't for everyone. Dave Ramsey is trying to speak to as many people as he possibly can while still being right. Dave Ramsey is not a fan of debt and leverage therefore for most real estate investors, business owners and individuals wanting to build any significant wealth, we believe would be underserved following Dave's advice.
With that being said we completely understand why Dave says what he says. What he does know about whole life is the typical whole life that is sold in the traditional way so we can't even say Dave is wrong. Therefore Dave and I are speaking to different audiences. He is an expert in getting people out of debt and we are the experts in setting up and properly using whole life insurance. We are for the audience who wants to build and pass down generational wealth to the people they love the most.
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