In the 1980’s, Nelson Nash uncovered the tool used by the wealthiest families in America to grow, maintain and pass along generational wealth. Turns out, large corporations and banks also rely heavily on this tool to secure their liquidity, help fund business expenses and earn favorable tax advantages. Walt Disney used it to build Disney World. Ray Kroc used it to build the McDonald’s franchise. Sears and J. C. Penney have similar founding stories. Robert Kiyosaki, Tony Robbins and countless others in the top 5% are proponents of this methodology.

In 2000, Nash released the book Becoming Your Own Banker which has become the definitive text on the subject and the roadmap of how to implement this powerful tool for building wealth on a personal level. 

So what is this tool?

It’s a high cash value whole life insurance policy backed by a dividend paying mutual insurance company. Aka, the And Asset.

It’s also affectionately known as the “And Asset” because by recycling every dollar earned, you can keep your money in your own bank where it compounds interest at a competitive rate and deploy the cash value to fund all of life’s requirements and grow your wealth. You ultimately create a system of no dead end dollars. Every dollar in is multiplied through your own banking policy. 

By reducing your reliance on banks and third party lenders you can have more control over your wealth and recapture interest costs. Interest costs include rates paid on personal loans and credit cards to banking institutions or lost opportunity costs, typically experienced when attempting to avoid paying interest to banks or credit card companies by making large purchases in cash. 

By utilizing a cash value whole life insurance policy backed by a mutual insurance company, you’re guaranteed a rate of return, fixed premium payments, a death benefit and certain tax advantages. You also earn, technically non-guaranteed dividends, but these have been paid out every single year by the companies we choose to work with (even though the Great Depression!). All in all, these benefits securely grow and protect wealth without exposing your foundation of savings to market volatility. 

Here are some additional advantages of a whole life policy structured for high cash value with mutually owned insurance company:

A Guaranteed Rate of Return

The primary reason whole life insurance is the preferred tool for infinite banking is because it offers a guaranteed rate of return, whereas other types of permanent insurance offer fluctuating returns based on market factors (variable and indexed universal life can be devastating in the long term and absolutely not recommended for practicing this strategy). With a guaranteed rate, you know exactly how much your cash value will grow every year.

Fixed Premium Payments

Some types of permanent life insurance offer flexible premiums. While it might seem appealing to be able to adjust the amount you pay in any given payment, especially if you’re experiencing financial hardship, what you might not know is that these types of policies are subject to increasing premiums at your insurance company’s discretion. Fixed premiums allow you to budget and know exactly how much your policy costs. What’s more, whole life policies can be structured to be paid-up by a certain age, like when you reach retirement, and you can use your cash value or dividends to cover premium costs.

Guaranteed Death Benefit

Another plus of using whole life insurance for infinite banking is that it offers a guaranteed death benefit, which can be distributed to your spouse or children, donated to charitable funds, used to cover estate taxes or put into a trust to build generational wealth. The death benefit is paid to the beneficiary tax-free.

Tax Advantages

Speaking of tax-free, infinite banking offers key tax advantages. Policy loans are always tax free, and dividends paid out by your insurance company are also usually tax-free. Because you fund a policy with after-tax dollars, you’re only charged taxes on the growth of your cash value. Even then, taxes only apply if you withdraw funds from your cash value beyond your basis—the amount you’ve paid in premiums. This becomes incredibly powerful when structuring your retirement plan. When executed correctly, you could be looking at a tax-free supplement to retirement! And if a 401(k) is part of your strategy, it also acts as a volatility buffer against market downturns. You can use the cash value of your insurance policy for retirement cash flow in years following a market downturn, allowing your 401(k) to regain value instead of continuing to take distributions.

Security

Insurance policies are private contracts between you and your insurance company, so when you use whole life insurance as your bank for your financial bedrock, it typically isn’t subject to judgements, creditors, lawsuits or asset searches. This is a great way to structure asset protection. 

…these are only a few benefits of the “And Asset.” 

If this concept still feels vague to you, it’s because the possibilities of this tool are endless. Yes, there are some rules and restrictions that are inherent to the insurance industry, such as health qualifications (but don’t rule yourself out! There are options!) and restrictions set in place by the IRS (so rude and lame, insurance was around way before the IRS was created in 1913, but we have answers for those restrictions too!). And if you’re thinking it’s a scam, well don’t be so quick to assume it’s yet another ‘get rick quick scheme,’ because it’s anything but that! It’s an asset (not an “investment”) you grow over your lifetime, and it’s wicked awesome.

As the policy holder, it’s up to you to determine how to fund and to become your own responsible banker. I’ll be here for you every step of the way, but as you begin to learn more and experience how the cash value accumulates, your imagination will start to run wild. This is highly encouraged! Think big, dream boldly. You will come to understand how freeing it is to be untied to market volatility and know that the work you do in life is a choice, not a requirement for a pipe-dream of someday getting to retire.

The best way to understand how this could work for you is for us to walk through an illustration mapping out your personal financial future from today until 120 years old. (because this is whole life, for your entire life)

Schedule a call to see how this could work for you: Click here to schedule

The No Dead End Dollars movement is in its infancy stages, but the “Infinite Banking Concept,” the “Perpetual Wealth Strategy,” the “And Asset”––call it what you will––has been functioning since the 1800’s and rapidly growing in popularity for becoming, once again, individual families bedrock of wealth.

In the very near future, additional educational materials will be shared through the No Dead End Dollars website and social media accounts. In the meantime, I encourage you to look to these resources to round out your education of this concept:

The Nelson Nash Institute

Video explanation of how IBC works

Real Estate Investing Using the Perpetual Wealth Strategy

And then, schedule a no-obligation call to learn how this could work for you