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Create Your Own Bank

Infinite Banking

Own Your Own Bank

Also goes by the terms 'cash flow banking', 'bank of you' and the more technical terms are; 'dividend paying life insurance' or whole life insurance'. To describe it briefly would be to basically own your bank, deposit money in it and lend out that money and collect interest on it! I know sounds too good to be true.. But it is true and the sad part about it is that most people including financial planners are unaware of it.

First of all lets look at how banks work; they take other peoples money in the form of deposits and promise them interest. They then lend out other peoples money, they are actually allowed to lend out 10 times what they have as a reserve, which is called fractional reserve banking but that is the topic of another article. Any way they lend out other peoples money and earn interest on it based on the priciple that everyone doesnt withdraw all their money at the same time. Obviously they charge more interest then they pay so as you can see it is a pretty lucrative business.

Back to Infinite banking and how it can help you, think of every time you buy something you either finance it and pay interest or you pay for it up front and you lose interest that you could have earnt leaving that money in a savings account. But obviously there are times when you have to spend large sums of your hard earnt money, a car, a home and maybe a new business venture. Wouldn't it be nice if you could borrow money of your self and pay your self interest? Well you can!

How it works is you start up a dividend paying life insurance policy you pay monthly payments into you policy and this accrues interst for you. The money you put into the policy and the interest you earn is taxfree due to the fact that it is seen as a superannuation policy. Say you eventually get ten thousand dollars in there and you need to buy a car you can then borrow against the money in there so you will receive you 10,000 to buy a car but your policy will still have ten thousand dollars in there collecting interest for you.

The advantages are the money is extremely liquid meaning you can have in your account with in a couple of days with out having to fill out applications and wait for a finance company to approve it. With the money you borrowed against say you were earning 5 percent and you paid your self five percent you would think whats the point right? Well you get compound interest in your cash flow banking system and the priciple that you are paying interest on shrinks every month.


So lets use the 5 percent example after 1 year you have earned 500 dollars interest in your infinite banking system so the next year you will get interest on 10,500 dollars and lets say you have paid off half of the 10,000 dollars you borrowed to buy your car so you are paying interest on 5,000 dollars. So year two you are earning 525 dollars interest and you are paying 250 dollars interest.You will actually have earnt more interest because you will still be making the monthly payments to your infinite banking system but I ignored that in this example to keep things simple. And those earnings are tax free, so if you are borrowing of your self essentailly then why not pay your self eight percent 5 percent goes to insurance company and 3 percent goes back into your cash flow banking system.

Where this system really works for you is in the long term when you have enough money to purchase a house.When you think about the amount of money you would pay to your bank over the life span of a mortgage, in some cases the interest paid exceeds the initial principle amount. Imagine all that money going back to you. And lets not forget it is still life insurance so if anything ever happens to you your loved ones will still receive a pay out. You can also use it for business expenditures, lending money to other people, it truly is a unique system that enables you to aquire vast amounts of weatlh.


If you want to find out more about infinite banking then this book; Becoming Your Own Banker: Unlock the Infinite Banking Concept has a wealth of knowledge or if you have already decided infinite banking is for you then you can talk to the friendly team at http://www.paradigmlife.net to organize your very own bank!

Discuss It!
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I am hearing about this information for the first time in my life. But there are some terms that important and that must be thorough with before creating own bank. Anyway thank you so much for this detailed information about owning bank.

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From the different fields of the world the banking is one of them. Many persons take interest in them and take them as their profession. In this they get the study of the accounts and business. There is a facility to get the good jobs in the bank.

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Financial Planners are being more competitive in businesses. They have got many points of DPLI in smart ways.

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On account that the Fed is not exclusive (it's independent--that is one of a kind) your query would not make experience. You your self admit that it used to be created by means of an act of Congress. Explain how anything created with the aid of Congress, that could be dissolved by using Congress, that has a board appointed by means of the President and tested by the Senate is by hook or by crook "personal"--are you able to to find even one private manufacturer the place that's real? Because it used to be created by law, please exhibit the place in the law it says that it's personal.

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