Infinite Banking (IBC)

The Infinite Banking Concept (IBC) is a financial strategy that involves using a properly structured whole life insurance policy as a way to become your own "banker" and finance major purchases, investments, and expenses. Here's a brief summary:

IBC is a  concept discovered by Nelson Nash that uses the cash value growth within a high-cash value whole life insurance policy as a personal banking system. Instead of taking out loans from banks, you take out loans against the cash value of your policy. The cash value grows tax-deferred, and the loans are not taxable income.

The process works like this:

1. You overfund a dividend-paying whole life insurance policy, contributing more premium than required. This rapidly builds up the cash value.

2. Once sufficient cash value has accumulated, you can take out loans from the insurance company using your cash value as collateral.

3. You then use that borrowed money to pay for major expenses like a car, home, business, or investments instead of getting a traditional loan.

4. You pay the loan back to the insurance company with interest, which goes back into your policy's cash value.

5. This process can be repeated indefinitely, hence the term "infinite banking."

Proponents argue IBC allows you to become your own banker, earn uninterrupted compound interest, and avoid paying interest to banks. Critics argue the strategy is complex, expensive due to whole life premiums, and may not outperform traditional investing. However, we have seen these policies play out in real-time with impressive results.

The proprietors of "The Money Multiplier" are prominent underwriters of policies using these concept. They utilize paid-up riders to make immediate cash value available. Common Mutual Life companies that offer  polcies that support this concept are:

• Lafayette Life

• Foresters

• Penn Mutual

• Ameritas

While IBC is not a scam, it requires careful structuring of the whole life policy and long-term commitment to be effective. Working with an experienced IBC practitioner & agent is recommended for those interested in implementing this strategy

We can explain the concepts of IBC in simple, easy to understand terms to see if this is a good fit for your financial goals.