Written by R. Nelson Nash / Originally published on infinitebanking.org / Used with permission

If you missed previous Lessons, go back and read that first HERE.

Creating Your Own Banking System Through Dividend-Paying Whole Life Insurance (continued)

In the previous lesson it should be obvious that this young man is paying $310.00 per month to the pool of money — $50.00 directly, in the form of premiums, and $260.00 indirectly, in the form of car payments. If he could understand what is really happening and pay the $310.00 directly to the insurance company in the form of premiums for around four to five years, he could now make a policy loan and pay cash for the car.

But this is the most important part – the insurance agent must make him vividly aware that he must repay the loan at an interest rate that is at least equivalent to the interest rate of an automobile finance company – not what the policy calls for. In this case it should be at least $260.00 per month. If the owner of the policy does this, then he will effectively make what the finance company would otherwise make and do it all on a tax-free basis. If the agent is really good and understands the principles of banking, he will encourage the policy owner to pay $275.00 per month because the “extra” dollars will go to his policy (or policies) to increase the capital that can be lent to other parties.

If the policy owner objects and says something like, “It’s my own money and I’m not going to pay any interest at all”– or even, “I’m only going to pay 2.9% as is advertised on the TV commercials” — then the agent must remind him of the grocery store example as taught earlier in this course and explain it all to him one more time. If he still doesn’t understand then the agent needs to have him revisit the First National Bank of Midland, TX and see how those folks killed the best business in the world. If he still doesn’t understand, the agent needs to resign from working with him because he is not teachable, or he is a thief! Neither of these characters is a good business associate.

You have now had an explanation of all the essential principles of “banking” through the use of dividend-paying life insurance, but to understand the infinite qualities of The Infinite Banking Concept requires a much deeper look. In the previous example of car financing, the capitalization really needs to be more than four years. Many college business professors estimate that corporations expect it to take at least seven years to make a profit on a new product. This is an understatement in certain circumstances. For instance, I have a degree in forestry, and I know it takes much longer than that!

So, why not capitalize at least seven years on each policy that one purchases, to the point where dividends will pay all the remaining premiums on the policy. The mechanics of this will be covered later on in this course, so let’s not bother with it at this time. Remember, I’m describing how all this works with the example of one policy—but you should be thinking on the basis of a system of many policies.

Would you have much of a grocery store if you were the only customer? You must build it to the point where you accommodate the needs of others in order to prosper. The same principle applies to banking. Have you not noticed that when a grocery store becomes successful in one location, then it tends to establish another store in another location?

Have you not noticed that banks have branch offices? There must be a reason for this.

Then, why not expand your own potential by buying all the life insurance on yourself that the companies will issue? And then, on all the people in which you have an insurable interest? At present, does not all your income go through the books of some banking institution?

Don’t the banks lend out the deposits of customers?

All banks do is capitalize the bank (Capital Stock) to make it a safe place for customers to deposit their money and then the banks lend out the money left on deposit. If they don’t lend it out, they will go out of business.

It will take the average person at least 20 to 25 years to build a banking system through life insurance to accommodate all his own needs for finance – his cars, house, etc. But, once such a system is established, it can be passed on to future generations as long as they can be taught how the system works and suppress their baser instincts to “go out the back door of the grocery store” with goods. Or, to put it bluntly – to steal!

Content: Page 24-25, Becoming Your Own Banker Fifth Edition {Get your copy here}

Written by R. Nelson Nash / Originally published on infinitebanking.org / Used with permission

Written by R. Nelson Nash / Originally published on infinitebanking.org / Used with permission

If you missed previous Lessons, go back and read that first HERE.

Creating Your Own Banking System Through Dividend-Paying Whole Life Insurance (continued)

Now, let’s go back to our scene on John Doe’s policy – he has had it for a few years and the Directors of the company ask the accountants, “How did we do on John’s policy this year?” They say, “We collected $1.10 but, after calculating all the earnings and expenses we found that it took only 80 cents to deliver the promised death benefit in the future.” This means that the Directors can make a decision with 30 cents. There is no way that they can calculate whether this was a good year or not and to be prudent, they put .025 cents in a “contingency fund” (this does not show up in cash values) and distribute .275 cents as a dividend.

Most people have the impression that this dividend is an income-taxable event. It is not really a dividend in the current sense of the word. It is a “return of capital” and it is not taxable until the amount withdrawn exceeds the cost basis, i.e. the amount put in. If this dividend is used to purchase additional paid-up insurance, what you have is an ever-increasing, income tax-deferred accumulation of wealth. It is only limited by your imagination.

These dividends can get to be very significant over a long period of time. In 1959 I bought a policy from a major insurance company and the annual dividend is now over eight times the annual premium. It would be even larger had I not used the dividends to reduce the premium during the first fifteen years of the policy. I should have been using them to buy additional paid-up insurance during that time. These things are just not adequately explained by life insurance folks because of the limited understanding of their home office personnel. A tragedy!

So far, this is a pretty simple, straightforward business. The complication is in the perception of it by the general public. We all see things through a filter of prior understanding – and that filter is awfully cloudy as it relates to life insurance!

Life insurance agents are taught to help clients calculate their human life value, (the now value of their future earnings, less their personal upkeep. This is their value to family and others that are closely associated) and insure for that figure. It really is a quite nebulous concept because there are so many variables that change with time. Once a figure is agreed upon, the agent shows “how little it will take in premium for my company to insure that amount.” This premium figure could be as high as 15% of income, after taxes.

My word! If you will take an honest look at what the average young man is doing – paying over 35% of every dollar of after-tax income to interest alone (see p. 19 in the book) – it should be obvious that his need for finance during his lifetime is much greater than his need for life insurance protection. If he will solve for his need for finance through dividend-paying life insurance, he will automatically end up with more life insurance than in any other concept and he will recover all the interest he is now paying to someone else.

But this almost never occurs because of the “cloudy filter” implanted by financial geniuses that “life insurance is a poor place to store money.” What a limited outlook of just what is going on in the banking world! Again, if you know what is happening, you’ll know what to do.

So, the typical young man puts $50.00 per month into life insurance premiums and complains about it. Then he goes down to an automobile dealer, makes a purchase, and gets a loan from a finance company to pay for it. Remember, there is only one pool of money out there in the world. The fact that a number of organizations and individuals are managing a portion of that pool is incidental. It is even more specific when it comes to car financing. I have never seen a monthly list of investments of a dozen life insurance companies that did not include finance companies as a place where they have loaned blocks of money. The finance companies simply buy blocks of money, and retail it to consumers after adding a fee for their work.

So, this young man pays $260.00 per month for 48 months for his $10,550 car loan. He repeats this process, every four years, because that’s the way his peers are doing it. If he would take a deeper look, he might notice that he is paying $50.00 per month into a pool of money (the life insurance policy) and paying $260.00 per month to an intermediary (the finance company) who got the money from the same pool. Furthermore, he complains about the premium he pays but thinks nothing of the much larger amount he pays the car finance company. Strange, isn’t it?

We learn how to recapture all this money in lesson 14.

Content: Page 23-24, Becoming Your Own Banker Fifth Edition {Get your copy here}

Written by R. Nelson Nash / Originally published on infinitebanking.org / Used with permission

Written by R. Nelson Nash / Originally published on infinitebanking.org / Used with permission

If you missed previous Lessons, go back and read that first HERE.

Creating Your Own Banking System Through Dividend-Paying Whole Life Insurance (continued)

As a result of what you learned in lesson 11, the company now has an ever-increasing pool of money. Your premium payments are pooled with that of all other policy owners, but all the accounting is separate. Every policy has the potential of being different. From time to time an insured person dies. It doesn’t happen very often, but when it does, the company pays the beneficiary from the pool of money and the cost of doing so is allocated among all the participants on an equitable basis.

The “hired help” (administrators, etc) must be paid for their work, too, and that cost is also allocated among all the participants.

At the end of each year the directors that actually run the company call the accountants in and, in essence, ask, “How did we do on John Doe’s policy this year in comparison with the assumptions made by the actuaries and the rate-makers in designing it?”

We must remember that an actuary is a kind of engineer and that all engineers “overbuild” everything they design. I think about this fact every time I am at the controls of an airplane. I have never seen an instrument panel that does not contain an airspeed indicator with a red mark somewhere on the face of it, telling you, “Don’t go past this point or the airplane will come apart on you!” That is not really true! It won’t come apart until the airspeed is some 20 to 30% greater than the red mark. The engineers have put a “fudge factor” into the equation.

But, if you operate the airplane just beyond the red line on a regular basis, you are inducing stresses on the wings that are cumulative in their effects and one of these days it will come apart on you. Unfortunately, it will be too late to correct the error of your past behavior!

The actuaries and rate-makers in a life insurance company have done, essentially, the same thing. They have collected more premium than is necessary to do the job. This is because the results of a life insurance plan is all predicated on (1) collection of premiums, (2) earnings on the investments, (3) mortality experience, and (4) business expenses. There are no stockholders in the kind of company that I’m describing so the “extra premium” is the capital that assures the success of the plan.

Furthermore, the policy is engineered to get more efficient every year, no matter what may come. This is a strange phenomenon to most folks, so let’s go back to the airplane world to make an analogy that will help us understand it. Imagine that we are going to make a very long flight in a Boeing 747, and so we load it with all the fuel it will hold. This means that it can fly about 10,000 miles. By the time we have flown 8,000 miles the airplane will now be able to do things that we would never attempt at takeoff – all because we have burned up an enormous quantity of fuel and the airplane weighs that much less. But the engines are capable of producing the same power as when we took off. Therefore, every mile that we fly, the airplane will get more efficient – and you can’t do a thing about it! It gets better – no matter what!

In comparison, a life insurance policy with a mutual (dividend-paying) company enjoys a similar phenomenon – it is engineered to get better every year, no matter what happens (that is, if the Owner does what is called for in premium paying, loan repayments plus interest that is at least equal to or better that the general investment portfolio of the company). In designing a life insurance policy, the rate-makers have taken into consideration the advice of the actuaries that their assumptions (i.e. interest earnings, death claims and administrative costs) are not set in concrete. Over a long period of time the actuaries will be very accurate, but from time to time the results can be better or worse than predicted and can affect the dividend scale declared for the next year. In fact, you can safely say that the real results will never exactly match the illustration provided at the beginning of the life of a policy. But, once a dividend is declared, it is now guaranteed from that point on. It can never lose value in the future.

A significant period of lower than expected earnings of interest, or a period of more than expected death claims and/or administrative costs can result in a “downer” for the company. When this happens in a regular corporation it is the function of the stockholders to “take up the slack.” But, in the case of a mutual life insurance company there are no stockholders! So, the rate-makers are cautioned by the actuaries, “if we calculate that it would take $1.00 per year for a given plan – don’t collect $1.00 – collect $1.10.” This extra .10 is the capital that makes the whole system viable.

We will continue this examination of what is happening in a life insurance contract in lesson 13.

Content: Page 22-23, Becoming Your Own Banker Fifth Edition {Get your copy here}

Written by R. Nelson Nash / Originally published on infinitebanking.org / Used with permission

Written by R. Nelson Nash / Originally published on infinitebanking.org / Used with permission

If you missed previous Lessons, go back and read that first HERE.

Creating Your Own Banking System Through Dividend-Paying Whole Life Insurance

At this point it is worthwhile to remember that “you finance everything that you buy,” whether you like the idea or not – you either borrow money from some other source and pay them interest or you use your own money and give up interest that you could have been earning. Some folks call this “opportunity cost.” Yet, it is amazing how many people give this idea lip service but do not put it into practice in their financial dealings.

In the September 1993 issue of FORTUNE magazine there was an article entitled, “The Real Key to Creating Wealth” by Shawn Tully. He is describing the concept of Economic Value Added (EVA) developed by Stern Stewart & Co. of New York. Tully says, “Understanding that while EVA is easily today’s leading idea in corporate finance and one of the most talked about in business, it is far from the newest. On the contrary: earning more than the cost of capital is about the oldest idea in enterprise. But, just as Greece’s glories were forgotten in the Dark Ages, to be rediscovered in the Renaissance, so the idea behind EVA has often been lost in the ever-darker muddles of accounting. Managers and investors who come upon it act as if they have seen a revelation.” We do live in a strange world!

o create your own banking system through dividend-paying whole life insurance we must understand how it all works. Tragically, there are very few people that really understand the idea. As it is with most things, it all begins with engineering. For instance, consider the automobile business. The car you drive started out being “lines on a piece of paper.” If the production workers don’t do what the engineers designed, you won’t have an automobile – but they did, and produced yours. I get the next one right off the assembly line. It is the same make, model, color, and optional equipment as yours. They are identical. Now, try to tell me that both cars will perform identically during their lifetime! There is no way that this is true because we know a number of people that can get 200,000 to 300,000 miles out of a car with no trouble. And we all know some folks that can’t get 50,000 miles out of it before they have worn it out — because of the way they drive and maintain it. Please keep this thought in mind as we look closer at the life insurance idea.

The engineers in life insurance are “actuaries.” They are dealing with a field of 10 million selected lives – persons that have been through a screening process (underwriting). And they are working with a theoretical life span of 100 years. Then they turn their information over to rate makers who determine how much to charge clients in order to be able to pay the death claims and make the whole system work over a long period of time.

Then the whole matter is turned over to lawyers who make legal and binding contracts that are offered to potential buyers through a sales force. The glue that holds this whole process together is the administrative and executive personnel. The finished product is a unilateral contract, that is, the company promises to do certain things if you meet the standards of acceptability and make premium payments. Read the contract and it will tell you very plainly that you are the owner of the contract — not the company. The Owner is the most important character in the scene.

To make the plan work the Owner must pay premiums into the contract and the Company (your hired help) must put the money to work in order to produce the benefits that are promised. Those with the responsibility of investment will do so in a number of ways in financial instruments that are fairly conservative, e.g. bonds, mortgages, etc. Look at the investment portfolio of a number of life insurance companies and you will see what I mean. One place that is speculative that some companies do invest in is in real estate developments. Some large developments of urban office buildings have been entirely financed by a single insurance company. The Golden Triangle in Pittsburgh would be an example. This can often include shopping centers.

But, upon reading the contract you will find it plainly stated that the Owner outranks every potential borrower in access to the money that must be lent! And what he can borrow is 100% of his equity in the policy (the amount that the company can lend at any one time). If this is true – which it is – then this amounts to absolute control over the investment function of the company. In essence, money can be lent to the other places only if the Owner of the policy does not exercise his option to use the money (and pay interest) instead.

We will resume this look at how life insurance works in lesson 12.

Content: Page 21, Becoming Your Own Banker Fifth Edition {Get your copy here}

Written by R. Nelson Nash / Originally published on infinitebanking.org / Used with permission

Written by R. Nelson Nash / Originally published on infinitebanking.org / Used with permission

Creating a Bank Like the Ones You Already Know About (Cont…)

Continuing our study from lesson 9 of The First National Bank of Midland, TX, it is apparent from the report of the December issue of the drilling magazine that a number of the directors of the bank were in the oil business.

There was quite an aberration in that business at that time. Many people had to wait in line for hours to get gasoline. In those days I was still flying with the Alabama Army National Guard and on drill weekends we flew patrol over the Interstate Highways for convoys of gasoline trucks. It was an interesting time. The best that I can remember it lasted a couple of years.

So, these directors of the bank were making loans to themselves to invest in the oil business where they were going to “make a killing” and not bothering to repay the loans. They were listening to pseudo-economists that were telling them, “Real money is natural resources like land, timber, coal, minerals, oil, etc. Borrow all the money from your bank that you can and put it in the oil business! You can really get rich!”

When the oil business returned to normal, these folks lost their oil business and their banking business – the best business in the world! Had they repaid their loans with interest (preferably with greater than normal interest) their bank would still have been in operation, but greed prevailed and “did them in.” All banks that went bankrupt during that period were just a variation of what happened here.

People behave on the basis of their understanding of things and are strongly influenced by the idea of getting rich quickly. Read Extraordinary Popular Delusions and the Madness of Crowds by Charles Mackay. It is a collection of stories of weird behavior of people down through history. People listen to “financial experts” and my own observation is that we have more financial geniuses per square foot today than in all of history combined! If those pseudo-economists were correct that “real money is oil” then tell me how much oil does Switzerland produce? None, but those folks have known something about banking for a very long time. Banking is the best business in the world.

So, you have now seen two examples of how a business can be destroyed — the grocery business by taking groceries out the back door of your store and the banking business by making loans to yourself and not paying them back.

Again, I warn you, if you want to kill the best business in the world then go to it. But your blood will not be on my hands. You have been adequately warned.

You must admit that getting into the banking business the way we have studied in lesson 9 & 10 is very costly and time consuming. It will be a long time before you show a profit, probably as much as 10 years. But it must be extremely profitable over the long haul for people to go through the gory mess you have just studied.

There is a much easier way to accomplish it and the mechanism has been around for over 200 years. It is tried and true. It is called participating (i.e. dividend-paying) whole life insurance. The problem is that very few people know how the business works, including the home-office folks at life insurance companies.

At this point, it will help if you understand the word, “co-generation,” a term used in the production of electrical power. Most everyone knows that this power is produced in plants using fossil fuels, nuclear fuels or water to turn turbines. But there is another source of power that is significant – the wood products plants – paper mills and sawmills. Trees are harvested for the wood they contain but the bark on the outside of the tree and the sawdust from sawing lumber has little economic value. But these things make a very good fire, and thus produce steam to turn dynamos that produce electricity. Every paper mill and all large sawmills have a “co-generation plant.”
Suppose that you own a paper mill and your co-generation plant can produce 125% of your needs for electrical power. What do you do with the surplus? You can sell it, of course! But you don’t have to erect power lines and get a sales force to sell it. You simply understand the distribution system is already there and you simply tie into that system and sell it to them!

Creating your own banking system through the use of dividend-paying life insurance is much like co-generation. All the ingredients are already there in place. All you have to do is understand what is going on in such insurance plans and tap into the system.

Content: Page 20, Becoming Your Own Banker Fifth Edition {Get your copy here}

Written by R. Nelson Nash / Originally published on infinitebanking.org / Used with permission

Thursday, June 20, 2024 6:00pm CT

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Written by R. Nelson Nash / Originally published on infinitebanking.org / Used with permission

Creating a Bank Like the Ones You Already Know About

As in the grocery business that we discussed earlier, you must first study the banking business so that you have a firm grip on what it is all about and feel that you can run such a business. Without this confidence you are fighting a losing battle. This, too, is a very competitive business.

Next, you must come up with some capital – money. In today’s world it should be in the order of $20 million or more and it must be on deposit at some other bank in a very liquid form — i.e. earning a very low interest rate while you are trying to get the Banking Commissioner in your state to issue you a charter. This is not all that easy to do. The odds of your getting a charter at this point are less that 100 to 1. There are a lot of other folks in your state wanting to get into the banking business too, and you must wait your turn. This could easily take 10 years!

If you missed previous Lessons, go back and read that first HERE.

A lot of what is going on at this stage is unseen. Whenever I hear the word “commissioner” it reminds me of an iceberg — only 10% of it appears above the water! Surely, you have had some experience with bureaucracy, so use your imagination as to what I’m describing. The bottom line is that you are going to spend a lot of time and money in this phase of creating your own bank. Years are likely to have passed before you finally win the coveted charter. In the meantime, you have probably gone through the part about a good location and an attractive building – all at considerable expense.

Now you are finally in the banking business! You must make your bank known by lots of advertising and trying to induce other people to deposit money in your bank. This is going to cost you a lot of money. Banks are in the business of lending money. Adam Smith, in his book, Paper Money, says, “A banker cannot make a loan unless he has a deposit. It seems a little silly to state that so baldly, but if three college educated Americans in ten don’t know we have to import oil, I don’t feel so bad about saying something bald. Banks do not lend their money. They lend the money someone else left there.” He goes on to say, “When you start up a bank, you have to put in some capital. Then you get some deposits, and then you lend the deposits. In a proper bank these three items bear a prudent relation to one another. If you are a little country bank with a capital of $100,000 it would be imprudent of you to loan Brazil $50 million. So, you want a prudent relationship between the capital and the assets, which is to say the loans on the books, and between the loans and the deposits. In the Western countries the financial agents of the government are there with a definition of prudence.”

Even with such government oversight banks can, and do, still fail. There were massive failures in the 1980s. A case comes to mind. In September 1983 the First National Bank of Midland, TX (the richest city in America per capita at that time) had a loan portfolio of $1.5 billion. And 26% of the loans were non-performing, i.e., they were not getting the money back. When this happens in a bank someone must support the situation, and this is normally the function of the stockholders. Because of the losses the stockholders’ equity lost 87% of its value down to $12 million. This is in relation to a $1.5 billion loan portfolio! That’s a shaky bank! Guess what happened when the depositors learned of this? Right! They withdrew $500 million! Remember, this is what bankers lend, the deposits.

This sounds ominous, but you haven’t seen anything yet! You must add the “multiplier effect” of bank lending practices. Practically no one knows that when one makes a deposit of $1,000 at a bank, the bank can now lend out $10,000. Where did the other $9,000 come from? They are creating money out of thin air! It is called the “fractional reserve lending system.” I call it the world’s largest “con game.” It is all predicated on the theory that “everyone is not going to withdraw their money at the same time.” For a complete understanding of all this, read The Creature from Jekyll Island by G. Edward Griffin, and also, The Case Against the Fed by Murray Rothbard.

So, First National hired a new CEO to come in and “put out the fire,” but it was too late. Two months later they were out of business. More under-standing of what really happened appeared in the December issue of a drilling magazine. Reading “between the lines,” it was pretty evident that a lot of those non-performing loans were made to the members of the board of directors.

Does this remind you of the grocery store example that we studied earlier? If the owner and his family go out the back door without paying for them, he will probably go bankrupt. The same think happens in the banking business!

Remember this, because in the banking system I am going to tell you about, you can also destroy it by not obeying the basic rules of banking. Loans have to be paid back or you can kill the best business in the world. It is all up to you, but don’t try to blame others when it happens. We will continue this in lesson 10. I’ll see you then.

Content: Page 19, Becoming Your Own Banker Fifth Edition {Get your copy here}

Written by R. Nelson Nash / Originally published on infinitebanking.org / Used with permission

Tuesday, June 18, 2024 6:30pm CT

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Written by R. Nelson Nash / Originally published on infinitebanking.org / Used with permission

The Problem (continued)

There is an analogy from the airplane world that helps us to see the absurdity of what we saw in lesson 7 of how the average American handles his money.

I’ve been a pilot for over 56 years, and it was obvious to me from the start that you can’t fly an airplane through a vacuum. It must go through an environment.

You have seen the weather maps with the “highs” and “lows” on it. The best flying weather is in the “highs.” Bad weather is associated with the “lows.” In the northern hemisphere the “highs” turn clockwise, and they will move from west to east over the face of the earth.

If you haven’t kept up, go back and start with Part 1!

Now, imagine this – there is a gigantic “high” that covers almost all of North America and the center is right over the middle of the country. You are located in Birmingham, AL, you have an airplane that will fly 100 miles per hour, and you want to fly to Chicago. The problem is that you have a headwind of 345 miles per hour! (notice the 3.45 to 1 ratio that we had in lesson 7). Guess which direction the airplane is moving! Right! Towards Miami at 245 miles per hour! It matters not what the airspeed indicator is telling you. The results are dictated by the environment. If you really want to go to Chicago, this is a good time to get your airplane on the ground – quickly! It is the best thing you can do.

Have some patience. Let the air mass move on — it will — they always do – and it will move from west to east. When the “high” gets directly over Birmingham, now get in the airplane and head to Chicago. There is no headwind and you are covering the ground at 100 miles per hour. At this stage, what I refer to as “the arrival syndrome” comes into play. “Whee, we are making progress toward our goal and you just can’t do any better than this!” Nonsense! Stay on the ground and let the air mass move on further east.

Now you have an airplane that can fly at 100 miles per hour, but it is being pushed toward your goal by a tailwind of 345 miles per hour. Your ground speed is 445 miles per hour! Fantastic! This is a dramatic improvement over the first two situations. But, you see, it is much more dramatic than what most folks think.

Everything you do in the financial world is compared with what everyone else is doing. In America, most folks are doing the equivalent of flying with a 345 mile per hour headwind. Isn’t it obvious, if you have a 345 mile per hour tailwind, that the difference between you and them is 690 miles per hour? In all three examples the capability of the airplane is the same — 100 miles per hour.

Translate this example into the financial world and it is pretty obvious what is really going on. Many financial gurus are concentrating on encouraging people to “get out of debt” and that is a wonderful thing to do. In our airplane analogy that is the equivalent of flying with no headwind. But, I have yet to hear one of these folks recognize that the most profitable thing one can do is to create the perpetual “tailwind” to everything that you do financially. It seems that this thought never registers in their consciousness.

But most financial gurus spend all their time “trying to make the airplane fly at 105 miles per hour” or something like that! Controlling the environment in which the airplane flies is far more effective.

You can’t do anything about the environment in the airplane world, but you can do it in the financial world. It must be done by creating a banking system that serves all your financial needs.

This course is about how to create a perpetual tailwind to your financial world that will, eventually, serve everything you do. You can’t do it without getting in the banking business. In the next lesson we will see what it is like to get in that business.

Pleasant dreams! Use your imagination. It can be a wonderful world for you!

Content: Page 18, Becoming Your Own Banker Fifth Edition {Get your copy here}

Written by R. Nelson Nash / Originally published on infinitebanking.org / Used with permission

Thursday June 6 6:30pm PT
Saturday June 8 TBD

Imagine a life where you never had to borrow from an outside bank again. What if YOU could be the bank?

Join us for an empowering 1.5-hour webinar on Thursday evening, followed by an all day workshop Saturday that promises to revolutionize the way you think about financing and investing in real estate. Learn the secrets of the Infinite Banking Concept (IBC), a strategy that savvy investors are using to enhance their financial independence and build wealth more effectively.

In these sessions, we will dive into the fundamentals of IBC and explore how you can apply these strategies to turbocharge your real estate investments. Discover through practical case studies how others have successfully implemented these methods to finance properties, improve cash flow, and reduce financial stress.

Conclude the webinar with an exclusive opportunity to schedule a personal consultation where you can uncover how to tailor the Infinite Banking Concept to your financial landscape. Whether you’re looking to optimize your investment returns or find more secure financial footing, this webinar is your first step towards a more prosperous financial future.

Register for attending in person at Northwest REIA on Thursday, June 6!

Register for attending in person at Northwest REIA on Saturday, June 8!

Tuesday, May 21, 2024 7:00pm ET

Finance Your Own Deals with Infinite Banking and Unlock the Secret to Financing Your Real Estate Deals!

Have you heard of Infinite Banking? If not you do not want to miss this weekday webinar. We are thrilled to have Jason K Powers with Unbridled Wealth teach us about Infinite Banking “Financing Your Own Deals with Infinite Banking”  & Unlock the Secret to Financing Your Real Estate Deals! 

Ever wondered how top-tier real estate investors stay ahead of the game? Here’s your chance to gain insight into a transformative strategy! Join Wealth Strategists and IBC Practitioners, Jason K Powers. Dive into the potent world of the Infinite Banking Concept and learn the strategy the wealthy use – and now you can too! This isn’t just another seminar; it’s the key to revolutionizing your investment approach. Elevate your game. Register below now for an evening that promises to redefine the way you see real estate finance!

Change the way you think about your finances, and it will change your LIFE!

Jason K Powers is a Multi-Business Owner, Real Estate Investor & Wealth Strategist with an eclectic and exciting background ranging from real estate investing to international non-profit work to wealth planning.  After learning about the Infinite Banking Concept and seeing what it could do for him, Jason dove head-first into helping others around the country set up their own Private Family Banking Systems, change their mindset about money, and experience something life-changing.

Learn more at MAREIA

Written by R. Nelson Nash / Originally published on infinitebanking.org / Used with permission

The Problem

Several years ago, I did a study on the spending habits of American families. The results are depicted in the graph on page 17 of the book. Since that time, I have kept an eye on the proportions on income allocated to each category and I’m convinced that the situation has become worse — they are spending more on interest and saving less.

I build my scenarios around the “average person” because I don’t want anyone to think that you have to be rich to create a banking system that can handle all your needs for finance. This young man is 29 years old and is making $28,500 per year after taxes — that is all he can spend. What does he do with the after-tax income? 20% is spent on transportation — 30% on housing — 45% on “living” (clothes, groceries, contributions to charitable causes, boat payments, casualty insurance on cars, vacations, etc.). Many of these items are financed by credit cards or bank notes. The balance is financed by paying cash for them — and thus, giving up interest that could be earned, otherwise. He is saving less than 5% of his after-tax income! (At the time of this writing he is saving absolutely nothing!) It is the first time in the history of America that this has happened. This scenario has all the ingredients for an impending disaster!

If you haven’t kept up, go back and start with Part 1!

To be as generous as possible, let’s assume he is saving 10% and spending 40% on living expenses. This is giving him every benefit of the doubt on the matter of savings. Just remember — the real situation is much worse than these assumptions.

The problem is that the cars, housing and much of the “living” items are financed by other banking organizations. The typical financing package for an automobile for this hypothetical person is $10,550 for 48 months with an interest rate of at least 8.5% and this produces a monthly payment of $260.00 per month. It is a fact that 95% of the cars that are traded in are not paid for. This means, at the end of 30 months, that 21% of every payment is interest – and this is a perpetual factor. It never seems to dawn on him that the volume of interest is the real issue, not the annual percentage rate.

What’s more, ask the sales manager of the high-priced cars, “What percentage of the cars that leave your agency are leased?” He will probably tell you 75% or more! That is even worse than having them financed!

Now, let’s move to the housing situation. This young man can qualify for a 30-year fixed-rate mortgage of about $93.000 at 7% APR with payments of $618.75 per month and closing costs of about $2,500.00. The problem is that within 5 years he will move to another city – maybe just move across town – or even refinance the mortgage. Something happens to a mortgage within 5 years. During the 60 months he has paid out $39,625, including closing costs but only $5,458 has gone to reduce the loan. This means that $34,167 has gone to interest and closing costs. Divide the amount paid out into the interest and closing costs and you find that 86% of every dollar paid out goes to the cost of financing! If he sells the house is less than 5 years, it is worse. This situation is also perpetual. He thinks he is buying a house, but all he is really doing is making the wheels of the banking business and the real estate business – in that order – turn. But, all the “financial experts”are advising him to indulge in this activity.

In the next segment of the spending pattern graph – the living expenses – you will find the interest on boat payments, credit cards, plus the cost of casualty insurance on cars, etc. will rival in volume the interest he is paying on the two cars in the family that we addressed earlier. Later on, in this course you will learn how to self-insure for comprehensive and collision insurance on cars.

Now, add up all the interest he is paying out and you find that 34.5% of every dollar paid out is interest. For the average All-American male this proportion never changes. Let’s assume that he is saving 10% of is disposable income (which he is not doing!). This would mean that we have a 3.45 to 1 ratio of interest paid out as compared to savings.

Now, get this young man together with his peers at a coffee break and have one of them suggest that they discuss financial matters. You can rest assured they will all talk about getting a high rate of return on the little dribble they are saving. Meanwhile, all the participants are doing the above! What a tragedy! But that is how they have been taught to conduct financial affairs.

We will continue this in lesson 8. See you then!

Content: Page 17, Becoming Your Own Banker Fifth Edition {Get your copy here}

Written by R. Nelson Nash / Originally published on infinitebanking.org / Used with permission

The Infinite Banking Concept (IBC) is a transformative financial strategy tailored for producers, actors, musicians and professionals within the music, film & entertainment industry, to build up their own privatized family banking system. The idea behind this concept is to replace the bank over time, and have the ability to build your own banking system throughout life. The vehicle through which the Infinite Banking Concept is utilized in is properly structured, dividend paying, whole life insurance policies.

What distinguishes this from most other financial vehicles is its liquidity and the magic of uninterrupted compounding growth. Essentially, uninterrupted compounding growth ensures that the cash value of the policy continues to grow even when borrow against it.

Unlike conventional loans where borrowing interrupts the growth of your principle, with IBC, the compounding effect remains undisturbed. This means that while you may have borrowed against the policy, the entire cash value keeps growing as if no loan was taken. This offers individuals a dynamic financial cushion, ensuring your money consistently multiplies, even while they’re using it. The power of compound interest can result in substantial financial gains over time, giving actors and musicians an edge in their financial planning and stability.

By leveraging a specially-designed IBC style policy, it offers the potential to manage and amplify ones wealth in a tax-advantaged, liquid, and accessible environment, akin to a personal bank.

IBC can be a lifeline for those in the entertainment industry, especially during lean periods. Whether you’re funding an album, a tour, or navigating gaps between acting jobs, the cash flow, liquidity, and accessibility provided by IBC can be indispensable. With IBC, instead of relying on unpredictable income streams or external lenders, one can utilize policy loans from their whole life policy. This ensures a consistent and flexible funding source without the red tape of traditional banking systems.

Furthermore, the Infinite Banking Concept offers a tax-savvy environment for financial growth. The growth of the cash value is income tax free, and any loans taken against it aren’t viewed as taxable income. Additionally, the death benefit is typically tax-free for recipients.

The Infinite Banking Concept can seamlessly integrate into a ones broader financial and career strategy. By harnessing its liquidity, autonomy, and tax benefits, one can augment their ability to finance and control their artistic endeavors. Furthermore, in utilizing IBC to be their own bank, one can leverage the desired privacy of their finances, and avoid the barrage of uncomfortable situations when having to utilize outside banks, due to a persons fame or fortune.

Beyond the immediate financial benefits and liquidity, the Infinite Banking Concept also presents a valuable resource for those in the entertainment industry in the twilight of their careers. As the frenzy of fame and the pace of tours wind down, IBC’s accumulated cash value can serve as a robust supplement to retirement. The wealth that has been growing and compounding throughout their life, can then be tapped into during retirement, ensuring a comfortable and sustained lifestyle. This means that not only does IBC support them in their prime, offering the freedom to chase dreams without financial constraints, but it also promises peace of mind as they transition into a quieter phase of life, surrounded by the fruits of their labor and artistry. This holistic approach to financial planning positions IBC as an enduring companion for those in the industry, from their first notes and first act to their final bow.

However, to maximize the benefits of IBC, it’s imperative to collaborate with an experienced & Authorized IBC Practitioner. Partnering with Jason K Powers is your gateway to this! When correctly applied, the Infinite Banking Concept can become an instrumental component of a your financial and creative blueprint.

Article by Jason K Powers

In the tapestry of life’s responsibilities, there’s one thread that’s often overlooked until it’s keenly needed: life insurance. It’s not just a policy tucked away in a drawer or a line item on our list of grown-up concerns—it’s a profound expression of love and foresight. Imagine it as a silent guardian of your family’s future, a promise that whispers, “I’ve got you,” even when you’re no longer there to say it yourself.

Think of life insurance as the ultimate act of planning—a way to outsmart the unpredictability of life itself. It’s about ensuring that your loved ones can maintain their lifestyle, chase their dreams, and maybe, just maybe, not feel the financial gravity of their loss as heavily. It’s a unique blend of hope and pragmatism, woven into a safety net that catches your family when fate takes an unexpected leap.

Why do we strap on seatbelts every time we get into a car? It’s not because we plan to crash; it’s because we acknowledge the possibility, however slim, and choose to mitigate it. Life insurance echoes this sentiment. It’s not a morbid fixation on the end but a strategic move to ensure that the story goes on, even if we’re no longer around to see it unfold.

For families, the absence of a loved one often brings a dual burden: the weight of grief and the potential collapse of financial stability. Here, life insurance steps in, quietly taking care of college funds, mortgages, or even just the daily expenses that pile up, unnoticed until they’re not. It’s the unseen hand that keeps the ship steady, ensuring that dreams, those of your children or spouse, don’t drift away with the tides of change.

And let’s not forget about debts. They’re loyal companions to many of us, sticking around far longer than we’d like. Life insurance ensures that these unwelcome guests don’t overstay their welcome, becoming burdens for those we love. From mortgages to personal loans and student loans, it clears the slate, offering a breath of fresh air to those figuring out their next steps without you.

But life insurance isn’t just a financial parachute; it’s a versatile tool. For some, it’s a stepping stone to future dreams—a fund for education, a down payment on a home, or a seed for a business venture, and even a supplement to retirement. For others, it’s a way to leave a legacy, supporting causes close to their heart or ensuring their family’s prosperity for generations. And amid the complexities of tax laws, it often emerges as a beacon of efficiency, navigating through to provide benefits without the usual fiscal headache.

In essence, life insurance isn’t merely about mitigating loss; it’s about amplifying love, foresight, and responsibility. It’s a testament to the fact that while we can’t predict every twist and turn of life, we can certainly prepare for it. So, as we weave the narrative of our lives, let’s not forget this crucial thread. It might just be the one that holds everything together, ensuring that the story—our family’s story—goes on.

Reach out to Jason today to what Life Insurance can do for you and your loved ones.

Contact Jason

Written by R. Nelson Nash / Originally published on infinitebanking.org / Used with permission

The Grocery Store (continued)

Now we are going to face the complications at your grocery store. Let’s assume that you are a male, married, with children – where is your spouse going to shop – your store or somewhere else? Your store, of course! She comes in and fills her cart with groceries. Here comes the complicated part, so pay close attention. This point is critical and requires complete honesty. Out of which door does she want to take the groceries – front or back?

When asked this hypothetical question, an amazing number of people will admit that “she will probably want to go out the back door, avoiding the cashier at the front door.” This is a polite description of theft! More retail businesses have been destroyed or severely limited by this factor than any other. It is a feeling among owners and those related to them that “this is our business and I can do anything I want to!” Unless this feeling is overcome the business is doomed. Remembering from lesson 5 the small markup on the can of peas – this means that if your spouse steals one can of peas, you must sell 20 to make up for it.

If you haven’t kept up, go back and start with Part 1!

Furthermore, can she go out the back door with groceries, over a period of time, without the employees witnessing her act? And what will they do? Right! They will do the same! I’m trying to paint the picture of how devastating theft is to a retail business. I’m told that 85% of theft in a retail business is by employees.

There is another factor that makes owners want to go out the back door with goods. All businesses have a “silent partner” – the IRS. If your spouse goes past the cashier at the front door and pays retail for the peas, it means that your store will make more money than if she went out the back door. And the IRS posture is – “the more you make, the more we take.”

Imagine a situation where there is no income tax on the sale of groceries. Now we have eliminated one of the reasons to go out the back door. The only problem that remains is the urge to use the back-door privilege. This must be overcome – your business is at stake.

In addition, you and your family (plus maybe some others) are “captive customers.” You are not going somewhere else to buy groceries. If you charge these captive customers wholesale prices you will make no profit and you have defeated the entire reason for being in business. If you charge them retail prices you are assured of profit. But these are “captive customers” – why not charge these folks 62 cents for the can of peas? Instead of making 3 cents you are now making 5 cents. Your have increased your profit margin significantly! The extra 2 cents will go directly to additional capital and it will enable you to buy more peas to sell to other customers – and there is an unlimited demand for peas! Hopefully, you can see what continued use of this practice can do to the profitability of your business. Do this over a long period of time and your record books will show a superior profit picture.

When you sell your business many years later, you are in competition with others that have not obeyed these principles. He and his family members took goods out the back door. His record books will never look as good as yours. In fact, he will probably have gone out of business some years ago.

Even if he is still around, can you guess which business will bring the better price? Yours!

With the proceeds from the sale you can buy a huge annuity and have income deposited monthly directly to your bank account at retirement time.

I hope that you have learned this little lesson well because we will re-visit the grocery store many times in this course of study. If you understand the grocery store, the rest of learning how to be your own banker is a “piece of cake.”

Grocery stores are in the business of moving groceries to customers. When you sell something, you must replace the item to sell again. If you own the store don’t steal the peas.

Banks are in the business of “renting money” to customers. When they lend money, they must get it back, with interest. If you own the bank don’t steal the money!

Pretty simple, isn’t it?

Content: Page 16, Becoming Your Own Banker Fifth Edition {Get your copy here}

Written by R. Nelson Nash / Originally published on infinitebanking.org / Used with permission

Article by Jason K Powers

The dynamic world of real estate offers myriad avenues for growth and profit. But as with all investments, funding and liquidity remain the lifeblood of success.

Enter the Infinite Banking Concept (IBC). 

At its core, the Infinite Banking Concept is about becoming one’s own banker. By harnessing the cash value growth of a dividend-paying whole life insurance policy, investors have a reservoir they can tap into. This capital can be borrowed against and repaid at the policy owner’s discretion, bypassing many of the hurdles of traditional bank financing.  When integrated into a real estate portfolio, IBC can prove to be a powerful ally.

Swift Property Acquisition

Navigating the maze of traditional bank financing often presents challenges: extensive paperwork, approval delays, and rigorous credit evaluations. For many real estate investors, these hurdles can mean missed opportunities. With IBC, investors can directly borrow against their policy’s cash value, cutting out the middleman. This means a swifter acquisition process, diminished fees, and a flexible repayment timeline that’s tailored to the investor’s unique needs.

Streamlined Rehabilitation & Improvements

For those in the world of Fix-N-Flips and Rehabs, securing external funding for such endeavors can be cumbersome, time-consuming, and sometimes expensive. Infinite Banking offers a solution. By allowing investors to borrow against their policy, funds can be accessed efficiently. Once the property is upgraded and either sold or refinanced, the policy loan can be repaid, keeping the investment cycle smooth and fluid.

Bridge the Gap with Bridge Financing

The real estate market is dynamic, with opportunities sometimes requiring immediate action. Traditional financing methods can be slow, making it challenging to capitalize on time-sensitive deals. The Infinite Banking model shines in these moments. As a rapid-response tool, it can act as a bridge loan, ensuring investors have the agility to secure promising deals. Then, once the property is refinanced or sold, the borrowed amount can be returned to the policy, ready for the next opportunity.

Strategic Land Purchases

Land is a foundational real estate investment. It offers potential long-term appreciation, especially in growing areas. However, immediate development isn’t always feasible or strategic. Here’s where the IBC becomes invaluable. Investors can tap into their policy’s cash value to finance land purchases, holding onto these assets until market conditions are ripe for development or resale, thus ensuring they don’t miss out on strategic land acquisitions. Remember the unstructured loan component? You’re in charge!

The Cushion of Cash Flow Management

Consistent rental income is the necessary for most real estate investors. Still, reality (remember COVID?) often presents challenges like vacancy periods or unexpected major repairs. Such disruptions can strain cash flow, making it tough to meet financial obligations. With the IBC, investors have a financial cushion. They can draw from their policy’s cash value to manage cash flow dips, ensuring that mortgages, property taxes, and other essential payments are met without a hitch.

Down Payments Made Easy

A sizable down payment can be a decisive factor in securing a lucrative property deal. However, arranging large sums quickly isn’t always feasible. Cash value from your policy, offers a workaround. By allowing investors to borrow from their policy’s cash value, they can swiftly arrange for down payments, often giving them a strategic edge in negotiations. This not only ensures quicker deal closures but also conserves other liquid assets for different opportunities.

Ready for Rainy Days

The unpredictability of the real estate market demands a well-prepared investor. Unexpected expenses, such as sudden repairs or unforeseen legal issues, can crop up, demanding immediate funds. The IBC serves as a financial safety net. Having access to the policy’s cash value ensures that investors can manage unexpected costs without destabilizing their portfolio or resorting to high-interest emergency loans.

Stay Liquid in Lean Times

Economic downturns and market recessions are inevitable. During such times, traditional lenders often become risk-averse, like they are right now, making it hard for investors to access funds. However, those integrated with the Infinite Banking Concept have an edge. They can access their policy’s cash value, ensuring liquidity even in lean times. This liquidity advantage allows them to capitalize on undervalued properties when others are cash-strapped, setting the stage for significant future gains.

Estate Planning with an Edge

Any robust real estate portfolio requires foresight, not just for current investments but also for future wealth transfers. The Infinite Banking Concept offers dual benefits in this regard. First, the death benefit of the insurance policy provides, usually, a tax-free wealth transfer mechanism. Second, the liquidity from the policy ensures that estate-related expenses or taxes can be managed without hastily liquidating properties, ensuring the legacy remains undisturbed.  So, in the intricate dance of real estate investment, the Infinite Banking Concept can be a game-changer. By merging the liquidity and flexibility of IBC with real estate’s potential, investors set the stage for sustained success. As with all financial strategies, it’s pivotal to engage professionals well-versed in both realms, ensuring the nuances of policy loans, dividends, and real estate intricacies are harmoniously intertwined.  That’s where we come in.

Reach out today, and let’s see what the Infinite Banking Concept can do for you.

Schedule A Time

In the rhythm of life, musicians face a unique financial melody, characterized by fluctuating incomes, unpredictable industry trends, and the perpetual challenge of balancing creative endeavors with financial stability. Amidst these nuances, the Infinite Banking Concept (IBC) emerges as a resonant strategy, offering musicians a harmonized approach to financial freedom and legacy building.

The Infinite Banking Concept: A Symphony of Financial Autonomy

At its core, IBC is a personalized financial strategy that enables musicians to create and control their own banking system through properly structured, dividend-paying, whole life insurance policies. This approach not only provides a safeguard for one’s financial future but also empowers musicians to manage their wealth with the same creativity they apply to their art.

Why IBC Strikes a Chord with Musicians

• Uninterrupted Compounding Growth: For artists, whose earnings can ebb and flow with tours, album releases, and gigs, the ability of IBC to continue growing wealth through uninterrupted compounding, even during lean periods, is invaluable. This ensures that the financial base of a musician not only remains intact but thrives, providing a steady crescendo of financial growth.
• Liquidity on Demand: The entertainment industry does not operate on a 9-to-5 schedule, and neither should its financial solutions. IBC offers unparalleled liquidity, allowing musicians to access funds when needed most — be it for studio time, instrument upgrades, or tour support — without the red tape of conventional banking.
• Harmony with Irregular Income Streams: Tailored for the artist’s financial rhythm, IBC adeptly manages the peaks and valleys of music industry earnings, offering a stable financial platform that respects the artist’s unique income pattern.
• Privacy and Control: In an era where privacy is increasingly precious, IBC affords musicians a discreet way to manage their wealth, free from the prying eyes of the public and traditional financial institutions that may not grasp the intricacies of the entertainment world.
• Encore for Retirement: Beyond the spotlight, IBC lays the foundation for a secure retirement, turning the accumulated wealth from a life in music into a steady, tax-free income stream. This ensures that artists can retire on their terms, surrounded by the comfort and security they deserve.

Crafting Your Financial Masterpiece with IBC

For musicians, the journey to financial independence is as much about creativity as it is about strategy. Partnering with an Authorized IBC Practitioner like Jason K Powers offers musicians a collaborative partner attuned to the industry’s unique challenges and opportunities. Powers’ expertise in IBC ensures that musicians can construct a financial strategy that plays in perfect harmony with their personal and professional aspirations, allowing them to amplify their wealth in a tax-advantaged, liquid, and accessible environment.

A Crescendo of Opportunity

The music industry, with its complex interplay of gigs, tours, album releases, and production deals, demands a flexible and dynamic approach to financial planning. IBC’s adaptability makes it an ideal companion for musicians, enabling them to navigate the financial intricacies of their careers with confidence and security. Whether funding an upcoming tour, investing in new equipment, or planning for life beyond the stage, IBC offers a robust solution that resonates with the needs of the modern musician.

A Final Bow

In the grand performance of life, financial security and creative freedom are not solo acts but a duet that every musician deserves to perform. The Infinite Banking Concept offers a path to this harmony, ensuring that musicians can chase their dreams without financial discord. In embracing IBC, musicians find not just a financial strategy, but a lifelong partner that supports their artistic journey from the opening note to the final bow.

As the music industry continues to evolve, so too do the financial strategies that support its artists. The Infinite Banking Concept stands out as a beacon of innovation and stability, offering musicians a way to secure their financial future while remaining true to their creative vision. Schedule a call with Jason K Powers today, and discover how IBC can transform your financial score into a symphony of success.

Learn More

Schedule A Confidential Call Today!

Written by R. Nelson Nash / Originally published on infinitebanking.org / Used with permission

The Grocery Store

Continuing our exercise in imagination, I would like to put you into a business in which you are both a seller and a consumer of products. I pick the grocery business since everyone uses groceries — there are no exceptions. Someone must perform the function of the grocer. You have an unlimited market. Everyone is a potential customer — as well as you and your family and maybe some other “captive customers” – these are folks who are not going somewhere else to buy groceries.

Before getting into the business you need to study it for at least two years. You had better understand it inside and out before you start or your competition will “eat your lunch!” It is a very competitive business. This is going to take some time and expense.

If you haven’t kept up, go back and start with Part 1!

Next, you must find a superior location for your business. Real estate agents say there are three qualities of real estate — location, location, and location. This is not an overnight activity. You are going to spend some time getting the right property and for this you are going to have to pay a premium price.

Now you are going to have to put an attractive building on that very high-priced property. This, too, is going to cost you a lot of money.

Then, you must stock the store with quality merchandise and it must be attractively arranged and maintained. This means you are going to have to have “hired help” (that’s “Southern” for employees)– you are never going to be able to run this business alone. Mom and Pop grocery stores are gone forever. Face it! Your employees must be attentive to customer needs, courteous and neat. You have spent a lot of money and time just to get to this point — and you haven’t made a dime yet!

At long last, you open the front door for customers — they come in and load their carts with groceries and take them by the cashier who collects their money at the front of the store. This is going to leave empty spaces in the display of goods. Your “hired help” is busy cruising the aisles, noticing where goods have been sold and very quickly going to the storeroom at the back of the store to get more things to fill up those spaces. It is imperative that the store appear to be fully stocked at all times. The customers demand it. Have you ever been to a grocery that was only partially stocked? Do you go back there to shop or do you go to some other store where managers pay closer attention to their business?

All of this means that you are going to have to re-stock the storeroom at other intervals to insure that you have immediate access to an adequate supply of groceries. Once you have all this set up and in operation, the difference between the “front door” and the “back door” is a very good living — if you can turn the inventory enough times during the year. If you sell a can of peas for 60 cents at the front door, you have to replace it at the back door at a cost of 57 cents. (I have found this to be a shocking revelation to most everyone). Grocery stores operate on a very small margin on such items. There is a different markup on meats, produce, and certain other items, but for things like canned goods that’s the way it is.

The can of peas sitting on your shelves is inventory and you must turn the inventory 15 times just to break even. There is all that interest you must pay on the huge sums of money you have borrowed to buy the land, the building, the inventory, the signs, advertising, payroll and fringe benefits, utilities, legal fees, accounting, etc. just to name a few. Turn the inventory 17 times per year and you have a nice profit. If you can turn the inventory 20 times per year you can retire early. Something dramatic happens once you get “over the hump.”

This reminds me of a phenomenon in physics – get a bucket of water at seaside (I want you at sea level) and heat it up to 210 degrees Fahrenheit and all you have is very hot water. Heat is up just 2 more degrees and you have live steam with unbelievable power! The steam engine changed the world. But it doesn’t happen until you get to 212 degrees F at sea level. Lots of heat goes into the process up to the boiling point but the dramatic power comes suddenly.

The objective of the business is to provide you with an income and to show a continuous profit picture over a long period of time, say 30 to 40 years. Then you sell the business and use the proceeds to buy a large annuity that will pay you retirement income for the remainder of your life.

So far, we have a very simple business. In the next lesson we will introduce the complications that can destroy your business. See you then!

Content: Page 15, Becoming Your Own Banker Fifth Edition {Get your copy here}

Written by R. Nelson Nash / Originally published on infinitebanking.org / Used with permission

In the fast-paced world of TV and film, financial security and flexibility are as crucial as talent and creativity. The volatile nature of the industry, with its unpredictable project timelines and income streams, demands a financial strategy that not only grows with you but also provides a safety net for the lean periods. Enter the Infinite Banking Concept (IBC), a revolutionary approach that offers TV and film professionals a unique solution to manage and maximize their financial assets.

The Essence of Infinite Banking

At its core, IBC utilizes dividend-paying, whole life insurance policies as a foundation to create a personalized banking system. This strategy transforms traditional financial planning, offering an avenue for uninterrupted compound growth, liquidity, and tax advantages, all within your control. For TV and film professionals, IBC stands out as a beacon of financial autonomy and growth, enabling them to navigate the industry’s financial unpredictability with confidence.

Uninterrupted Compound Growth: A Game Changer

The magic of IBC lies in its ability to facilitate uninterrupted compound growth. Unlike traditional investment vehicles, the cash value in your IBC policy continues to grow — even when you borrow against it. This feature is pivotal for TV and film professionals who often invest heavily in their projects. Whether you’re financing an independent film, covering pre-production costs, or investing in new equipment, IBC ensures your wealth continues to expand, unaffected by your borrowing.

Liquidity: Your Financial Backbone

Liquidity is the lifeline of any TV and film project. IBC shines here by providing immediate access to funds when needed most. This flexibility allows professionals to seize opportunities without waiting for external financing approvals or navigating the red tape associated with traditional loans. Whether it’s bridging the gap between projects or ensuring cash flow during production delays, IBC offers a reliable financial cushion, keeping your projects — and career — moving forward.

Tax Advantages: Maximizing Wealth

IBC operates within a tax-advantaged framework, ensuring your financial growth is not only uninterrupted but also efficient. The growth of the cash value within your policy is tax-deferred, and loans taken against the policy are tax-free. For TV and film professionals, whose earnings can vary significantly from year to year, this aspect of IBC provides a strategic advantage, allowing for more effective wealth accumulation and financial planning.

Adapting to the Unpredictable Nature of the Industry

The TV and film industry is characterized by its unpredictability, with professionals often facing periods of feast and famine. IBC’s adaptability makes it an ideal financial strategy, providing a steady source of funds through its loan feature. This adaptability means that during downtime or when awaiting the next project, you can still access funds, ensuring financial stability without disrupting your policy’s growth.

A Partner in Your Financial and Creative Journey

Partnering with an experienced and Authorized IBC Practitioner is crucial to fully leverage the benefits of this strategy. For TV and film professionals, this partnership offers not just financial advice but a collaborative relationship that understands and supports your creative and financial aspirations. An expert in IBC can help tailor this strategy to fit your unique circumstances, ensuring that it aligns with your career trajectory and personal financial goals. That’s where Jason K. Powers comes in.

IBC: More Than Just a Financial Strategy

For those in the TV and film industry, IBC is more than a financial strategy; it’s a tool for career empowerment. It provides the freedom to pursue projects that align with your creative vision without financial constraints. Moreover, as you transition through different phases of your career, IBC continues to serve as a robust financial foundation, from funding your initial projects to ensuring a comfortable retirement.

In conclusion, the Infinite Banking Concept offers TV and film professionals a dynamic and flexible financial strategy tailored to the unique challenges of the industry. By facilitating uninterrupted compound growth, providing liquidity, and offering tax advantages, IBC empowers you to take control of your financial destiny. It allows you to focus on what you do best — creating compelling TV and film content — while securing your financial future. As the industry evolves, having a solid financial plan in place with IBC can be the difference between merely surviving and truly thriving in the world of TV and film.

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Article by Jason K Powers

In the world of personal finance, the Infinite Banking Concept (IBC) emerges as a revolutionary strategy, empowering individuals to break free from traditional banking and investment institutions’ clutches. This concept, pioneered by R. Nelson Nash, is not just a financial strategy but a paradigm shift towards achieving financial independence and security.

The essence of Infinite Banking lies in utilizing the cash value of properly structured whole life insurance policies as a personal banking system. This allows individuals to borrow against their policy to invest in real estate, pay back the loan at their own pace, and simultaneously earn cash value accumulation along the way. This unique blend of liquidity, safety, and growth offers real estate investors a level of flexibility and control that traditional banks and investment institutions cannot match.

For real estate investors, the importance of controlling the banking function in their lives cannot be overstated. Traditional financial institutions often prioritize their interests, imposing terms and conditions that may not align with the investors’ goals. These entities dictate loan terms, interest rates, and repayment schedules, leaving investors in a position where their financial strategies are influenced by external factors. Infinite Banking, however, places investors in the driver’s seat, enabling them to finance their projects on their terms without external interference.

This autonomy is particularly crucial in the fast-paced world of real estate investing, where timing and the ability to act swiftly can make the difference between securing a lucrative deal and missing out on an opportunity. The conventional route of securing financing through banks & other lenders often involves lengthy approval processes, during which prime investment opportunities can slip away. By contrast, Infinite Banking offers immediate access to funds, allowing investors to capitalize on opportunities with agility.

In addition to providing a source of financing, Infinite Banking instills a sense of responsibility and control over one’s financial future. Real estate investors, in particular, benefit from this empowerment, as it enables them to make more informed and strategic decisions.

Moreover, the Infinite Banking Concept even extends its utility to personal and family financial planning. From debt recapturing, to college savings, to car loans, mortgages, family savings, and even retirement income, the Infinite Banking Concept can truly act as your privatized family bank throughout ones life. The concept of generational wealth takes on a new dimension as well. By establishing a system where wealth is not merely accumulated but also efficiently transferred across generations, families can ensure financial stability and growth for their descendants for generations to come.

In conclusion, the Infinite Banking Concept is not just a financial strategy, but a pathway to financial sovereignty. It challenges the traditional dependency on banks and financial institutions, offering a blueprint for managing and growing wealth independently. By embracing Infinite Banking, real estate investors can unlock a new level of financial freedom, positioning themselves to take advantage of opportunities with greater ease. In the process, they not only achieve their financial goals but also pave the way for a future where their financial destiny is firmly in their own hands.

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