so what should you know before practicing the infinite banking concept so the infinite banking
concept or becoming your own banker is a great concept really teaches one how to use a high
cash value life insurance policy specifically a dividend paying whole life insurance policy
as a financial tool once a dollar passes through a policy there's no lost opportunity cost I can use
the money indefinitely whether that's to pay off debt invest in real estate in business whatever
it might be great concept it works beautifully but what we found over the years of just being
in business and working with individuals whether they own businesses or they are just an employee
an average employee for an account for another company or something like that is often one is
exposed to the concept whether whether they read Nelson's book they find out about it online they
talk to someone who specializes in the concept and their presents with the policy and they look
at it and say ok I get that I can practice the concept with this but it takes forever for me
to get my money back meaning I'm paying in call it 10k a year it takes seven years or up to ten
years just to break even and then it's with some company that I haven't heard of how do I know
they're they're a solid company are they actually actually going to produce what this projection
says they will produce and you know the thing is that has been in my opinion the one thing that
has stopped a lot of people from moving forward with the concept because they're putting all this
money into a cash value life-insurance policy and they have somewhere between 50 and 60 percent of
their payment in the first year they're losing money paying for the huge insurance expense the
death benefit upfront so really when it comes to practicing ibc what we educate everyone on before
that for someone that says hey practice this concept how do I make sure it's set up right
well what we will teach you to do teach you how to do whether you're looking for a policy or in
the industry trying to teach your clients this is this simple how to maximize the cash value on a
life insurance policy first and foremost because if that cash value is maximized what that does
for you is one give you more money in a cash value life insurance policy compounding for you you've
gotten more money from start to finish breaking even much earlier typically between years three
and five instead of seven and ten copying what big institutions and banks do by the way so that's
the first thing design the policy for maximum cash value and flexibility and then to company
selection a lot of insurance companies out there how do I make sure I'm set up with a company that
has actually delivered not just projected one thing and then under delivered so we're gonna
walk through those two items here so again we do this before practicing IV C so we're assuming we
understand the concept we want a policy but we want to make sure it's set up right so I don't
have buyer's remorse down the road we've run into that all the time someone takes out a policy and
says wait a minute if I would have known I could have had thirty percent more in the first year of
my money what I paid into it I would have went with this option why was I not shown this see
it all the time so we set up a policy this is going to teach you right here how to maximize
the cash value of your dollar your money can go towards one of two areas the insurance premium
or the PUA Rider the insurance premium let's say you're paying $1,000 per year there or a hundred
thousand doesn't matter maybe respect to your cash value dollars that go into the insurance premium
typically produce little to zero cash value in the first and second year the reason why is that the
premium dollars is a death benefit first and foremost so when I take out a life insurance
policy your money can go toward the insurance premium or directly into the PUA component the
insurance premium which all often referred to as the initial insurance expense as well the company
over charges me as the policyholder for the death benefit up front in the first and second year and
it's after that point in time as I hit year three now you will begin to see that minimum premium
show up in cash and start to yield dividends and interest so that's the first area the second area
is my PUA component I'll refer to this as a cash dumping what we are doing here is accelerating the
cash value of a life insurance policy dollars that go into the PUA component show up in cash
value that's going to be anywhere from right off the bat 97 to 100 percent of my payment and cash
value that's money you can access right away at 20 that begins to yield the guarantees right away
that's money that begins yielding dividend sooner this is the key part in my poor handwriting there
this is the key to accelerating the cash growth on a life insurance policy money I have in this
piece I can use and practice this sooner than later okay now it is worth noting that dollars
you pay into the POA piece PUA stands for paid up additions paid up additional life insurance it
does buy us more death benefit if I pay thousand in it might get me another three thousand dollars
in death benefit depends on my age so that number is going to vary just a quick example there so a
question we get frequently and this is what's going to determine if I have sixty percent of
what I paid to a policy up front or between 80 and 90 percent up front here's what it has to do it
I get this question all the time Steve how do I put a hundred percent of my payment into the PUA
component because I'm mr. policyholder don't care about the death benefit we hear that and I get it
but that's benefit is important but if someone's focused on the cash value component we're going
to educate them on that so we cannot put a hundred percent here the reason why is we have limits we
have limits by the insurance company and also the IRS typically some of the top companies wherever
you set that premium will allow you to pay up to ten times that into PU age per year some
have no limits you can have your premium at five percent at one percent not quite one button we
can really drive it down and then some have more conservative limits where we can only add another
three times the minimum premium into P weights I don't want to get too deep in the weeds here we
do have content on that main point though we have the insurance company limit typically I can drive
my premium down as well as 10% so I've had $1,000 premium I can pay up to 10k per year with a lot
of the companies over here and the next piece we have is our meklin it stands for modified
endowment contract what many are not aware of is we can actually set that wherever we want
what you will find is how we move that neck limit up and down when I say set wherever we
want it's when we first start a policy the IRS really looks at one's age and death benefit to
determine what your MEC limit will be think of it this way the total amount of life insurance
is the measuring stick that the IRS uses to determine if a life insurance policy is life
insurance in their eyes or a pure taxable investment so that's the policy design and
then we've got company selection I'm not saying these are the only companies to go with these are
the companies and then all of our studies have come out to produce the strongest cash values
and we have proof of it we do not have proof from other carriers yet you are working with
many smaller companies to obtain that proof but when you look at these companies when you look
at their size their financials they are massive and cream of the crop in terms of ratings but my
big selling point what sells me on them is when you look at cash value life insurance policies we
often see illustrations but whose consistently delivered among the highest actual cash values
remember my point of emphasis what I focus on is okay IBC that's great we want to teach you
how to practice that how to incorporate that but again if you maximize the cash value first
that puts you in a position where you've got more money to accelerate everything that's the
goal these companies we've consistently seen among the highest cash values now they don't
all accommodate to the IBC strategy so that's where more education comes in and such but with
that said what we look at first and foremost with everyone is firstly how do I design the
policy for maximum cash value or the ability to maximize my cash value quick sidenote if I want
the ability to pay in 10k I can easily design a policy where I only commit to close to $1,000
per year and add the additional funds at my leisure same thing if I want the ability to
put in 100k per year I can design it with a 10k minimum base premium and then have the ability
to add up to a hundred without being committed so we can design a policy to be very flexible there
but what it does is again optimize my cash value life insurance at its core safe liquid tax-free
area to position money then I've got the company and the quality over here again when I say quality
looking at actual data whose delivered we've seen it consistent with these guys that's why
I'm so big on the big four no this is a lot of info hope it helps reach out with any questions
at all hey guys Steve Parisi here if you enjoyed the content you just saw please subscribe like and
hit the notification valve for future videos if you'd like more information or to see some
custom policies for yourself feel free to call or email our offices at the contact information below