If you know me, or if you have been reading my blogs, you know I am a raving fan of IBC – The Infinite Banking Concept, as taught by R. Nelson Nash in his book “Becoming Your Own Banker.”
Here are the five simple rules to IBC:
- Think Long Range
- Be generous in capitalizing your system
- Don’t steal from your system
- Don’t do business with banks
- Rethink your thinking
While the process is simple, I couldn’t possibly do it justice by trying to explain the entire concept in this short article. So today, we are going to focus on how IBC allows you to build your own pool of capital, and why it is the very best place to store and access your cash.
One of my biggest concerns for people is their lack of knowledge about capital – not understanding what it is, how to grow it, or keep it. You might ask – Why do I have to have capital? What is capital? How different people’s financial landscape would look if they were in control of their own capital! This is a great thing to think about and even a better thing to talk about.
So what is Capital? Capital is Cash! Most people do not have much in reserves (if any!) because they have become used to using other people’s money, paying interest, and are caught up in the cycle of buy now pay later. Just imagine if you had a pool of cash that you could access whenever you needed it, for whatever reason – to make a significant purchase, cover a repair for your home, pay tuition, or cover the cost of a family vacation – how great and stress-free would that be?
Why is having and controlling capital so important? Because it can make you money, it provides security and flexibility, and it saves you money! Without access to our own capital – we are stuck using other people’s money (banks) and are required to play by their rules. We have no say in when we get the money, how much money we can get, how much money it will cost us to borrow the money, and when the money must be repaid! Whether you are a business owner or an employee, there is no guarantee a bank will lend you the money you want or need. You are required to prove your creditworthiness based on their criteria. It does not matter how great of a relationship you have with YOUR banker, or how good your credit score is; if there is economic upheaval, you may or may not be granted access to their money; you have virtually no control!
In his book, Nelson asks, “How much of the banking function do you want to control in your life?” Most people do not have a ready response to this question because they have never thought about it before. We have been trained to use other people’s money and have never considered the concept that we could be our own banker! The answer, though, is undeniable – ALL OF IT (see rule #4)!
If you have built up capital in your IBC designed policy, you have contractually guaranteed access to your money. How much can you borrow is based on the amount you have put in. Banking is about accumulating money and loaning it to yourself and paying yourself back with interest (Rule #3). It is imperative to understand this principle – You finance everything you buy – you either pay interest to someone else, or you give up the interest you could have earned.
Most people in America pay over 34% of every dollar in interest to someone else, and that money is lost forever from their personal economy. We have been brainwashed by hundreds of millions of dollars in advertising (financial noise) that we need to use other people’s money and not take the time to build up our own warehouse of wealth. Another core principle that must be understood is this – there is always a cost of capital, even if it is your own money. If you are going to act like a banker, you can’t treat your money like it is free. We have been conditioned not to wait and save for something we want. Remember the first two rules of IBC “Think long term and Be generous in capitalizing your system.” Have you ever had too much money in your bank account? Of Course not! It may take a while to build your bank, but I promise you – the rewards and financial freedom that come with it is worth your time!
By building up a pool of money in your policy, you can mimic what banks do. You have a contractual right; you can never be denied access to borrow against the money that is in your plan. If you borrow against your cash value to invest in a real estate opportunity, while your money is still compounding and growing, you create velocity of money, just like banks do! The growth is your policy is guaranteed. And guess what? It grows 24 hours a day, seven days a week, 365 days a year! It does not matter if the market is up, down, or sideways! I am an Authorized Infinite Banking Practitioner, and I help people every day set up specially designed polices just for them, their goals, their needs.
I often hear from folks who are excited to start an IBC plan after reading Nelson’s book, but they think they must pay off all debts first. This seems to be a common misconception when someone first learns about the IBC strategy. Let me help you understand why this is wrong – If you say you are going to pay off everyone else before you pay yourself, aren’t you saying that their money is more valuable, more important than your money? If you have debt or are considering a major expense, I can show you…no actually prove to you that by running your money through your plan first, you will have increased control over debt repayment and get out of debt much faster. You will have more to show for your efforts and free up cash flow to live the life you deserve to be living.
We have proprietary software that provides you with a roadmap to follow, step by step. Typically, our clients are out of debt in 9 years or less, including their mortgage, without spending any more money! If you are open-minded and are willing to spend 15 minutes of your time, give me a call.
As Zig Ziglar once said, “You don’t have to be great to start; you just have to start to be great!” I want to help you create a GREAT financial future!
