Infinite Banking: Buyer’s Guide (Companies + Rates)
Infinite Banking is the idea of using your whole life insurance policy as a personal bank. According to the Infinite Banking Concept, a person can take out loans from the cash value of their policy and avoid paying high interest rates to banks. The cash value of a whole life insurance policy grows tax-free and can be withdrawn at any time as long as the policyholder pays their premiums.
Free Car Insurance Comparison
Compare Quotes From Top Companies and Save
Secured with SHA-256 Encryption
Eric Stauffer
Licensed Insurance Agent
Eric Stauffer is an insurance agent and banker-turned-consumer advocate. His priority is educating individuals and families about the different types of insurance coverage. He is passionate about helping consumers find the best coverage for their budgets and personal needs. Eric is the CEO of C Street Media, a full-service marketing firm and the co-founder of ProperCents.com, a financial educat...
Licensed Insurance Agent
UPDATED: Mar 27, 2023
It’s all about you. We want to help you make the right coverage choices.
Advertiser Disclosure: We strive to help you make confident life insurance decisions. Comparison shopping should be easy. We are not affiliated with any one life insurance provider and cannot guarantee quotes from any single provider. Our life insurance industry partnerships don’t influence our content. Our opinions are our own. To compare quotes from many different companies please enter your ZIP code on this page to use the free quote tool. The more quotes you compare, the more chances to save.
Editorial Guidelines: We are a free online resource for anyone interested in learning more about life insurance. Our goal is to be an objective, third-party resource for everything life insurance related. We update our site regularly, and all content is reviewed by life insurance experts.
UPDATED: Mar 27, 2023
It’s all about you. We want to help you make the right coverage choices.
Advertiser Disclosure: We strive to help you make confident life insurance decisions. Comparison shopping should be easy. We are not affiliated with any one life insurance provider and cannot guarantee quotes from any single provider. Our life insurance industry partnerships don’t influence our content. Our opinions are our own. To compare quotes from many different companies please enter your ZIP code on this page to use the free quote tool. The more quotes you compare, the more chances to save.
On This Page
- Infinite Banking is the idea of using your whole life insurance policy as a personal bank
- You can take out loans from the cash value of your whole life insurance policy as long as you pay your premiums
- The cash value of a whole life insurance policy earns interest and is not taxed
If you have a whole life insurance policy, you may have heard of the Infinite Banking concept. However, you may be unsure of what Infinite Banking is or how it works. You may even be wondering, “Is Infinite Banking a scheme?”
Well, at its simplest form, Infinite Banking is a way of using your whole life insurance policy to grow your wealth.
Instead of relying on traditional banks, Infinite Banking allows people to grow their savings while avoiding high-interest rates on bank loans.
Sound too good to be true? Keep reading below to learn what Infinite Banking is, how whole life insurance factors in, and whether or not it’s a scheme.
But before you do, enter your ZIP code into our free comparison tool above to find affordable life insurance rates near you.
What is Infinite Banking?
Infinite Banking is an idea created by Nelson Nash in the 1980s. So what is Infinite Banking anyway?
Well, Infinite Banking is the idea of growing and maintaining your wealth without having to rely on traditional banking systems.
When you take out a loan for a home or an automobile from the bank, the bank gives you the money upfront but requires you to pay it back with interest.
As long as people have to rely on banks for loans, banks can charge high interest rates without suffering any consequences.
With Infinite Banking, you don’t have to rely on banks for loans or pay fees for managing your accounts. Instead, you grow your money through a whole life insurance policy. Essentially, you get to be your own bank.
Sound like your cup of tea? Compare whole life insurance quotes from several companies to find a policy that works for you.
Compare Quotes From Top Companies and Save
Secured with SHA-256 Encryption
How does whole life insurance work in Infinite Banking?
Whole life insurance policies come with a cash value, that is, the amount of your life insurance’s death benefit the insurance company makes liquid to you. If you cancel your policy while still alive, the insurance company would pay you that cash value.
However, as long you continue to pay your whole life insurance premiums on time and in full, you can use the cash value of your policy for personal loans.
The more you pay into it, the more cash value you have access to. Your life insurance policy serves as collateral.
In addition, if you opt for a participating whole life insurance policy instead of a non-participating life insurance policy, you can receive dividends based on the insurance company’s profits.
This will also increase the cash value of your policy.
The way this works with Infinite Banking is instead of putting your money into a savings account, you put your money into a tax-free whole life insurance policy, earn guaranteed interest plus potential dividends, and take out loans whenever you need.
Is Infinite Banking a scheme?
Now that you know how Infinite Banking works, you’re probably thinking it sounds too good to be true. You may be wondering, “is Infinite Banking a scheme?”
While Infinite Banking may be unorthodox, it is not a scheme. However, Infinite Banking requires a little more foresight and thought to manage than a traditional bank account, which is why some people prefer to use traditional banks.
Infinite Banking has been used by many wealthy people to grow their wealth and pass it on to their children. If done right, you can see higher returns than you would with a traditional savings account.
If you’re considering Infinite Banking, compare whole life insurance rates from multiple Infinite Banking companies to find the best deal. We recommend looking at at least three Infinite Banking companies before buying.
Now that you know how Infinite Banking works, start shopping for whole life insurance today.
Enter your ZIP code into our free comparison tool below to buy whole life insurance from providers in your area.
Compare Quotes From Top Companies and Save
Secured with SHA-256 Encryption
Eric Stauffer
Licensed Insurance Agent
Eric Stauffer is an insurance agent and banker-turned-consumer advocate. His priority is educating individuals and families about the different types of insurance coverage. He is passionate about helping consumers find the best coverage for their budgets and personal needs. Eric is the CEO of C Street Media, a full-service marketing firm and the co-founder of ProperCents.com, a financial educat...
Licensed Insurance Agent
Editorial Guidelines: We are a free online resource for anyone interested in learning more about life insurance. Our goal is to be an objective, third-party resource for everything life insurance related. We update our site regularly, and all content is reviewed by life insurance experts.