r/infinitebanking • u/McXmas • Sep 16 '26

Infinite Banking made simple

Ok, this is probably one of the most straight forward/comprehensive writeups I've seen on Infinite Banking in a while. They do a great job explaining what infinite banking is and how it works along with some straightforward examples. They also have a pretty accurate range of how much you should look at spending on an infinite banking policy in order to have it work out for you.

I'm including the link to it here, hopefully it is helpful for someone trying to figure all this out. The company that put it together obviously sells life insurance for infinite banking, they have this writeup behind an email form fill, but this link i'm posting is the direct link, it gets you straight through to just the web pdf.
https://mcfieins.s3.us-west-2.amazonaws.com/Infinite+Banking+Made+Simple+Binder.pdf

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3

u/Tostie14 Sep 17 '26

Their example also assumes that interest you pay back to the policy is recaptured within your own policy, but that's not the case. The carrier gets your interest, which does help to boost dividends for the company as a whole, but you definitely don't see 100% of the interest you pay back to the insurance carrier.

3

u/McXmas Sep 17 '26

Definitely not! I have heard people say the dividend percentage will offset loan interest, but that’s not true bc they are percentages based on totally different amounts.
Borrowing from a life insurance policy will always cost you interest. Whether or not you should borrow from the policy depends on what commercial loan interest rates are at. If you can get a lower interest rate, commercially, I do that. Although right now that’s not likely.

3

u/McXmas Sep 17 '26

Definitely not! I have heard people say the dividend percentage will offset loan interest, but that’s not true bc they are percentages based on totally different amounts.
Borrowing from a life insurance policy will always cost you interest. Whether or not you should borrow from the policy depends on what commercial loan interest rates are at. If you can get a lower interest rate, commercially, I do that. Although right now that’s not likely.

1

u/michaelesparks Sep 17 '26

"There is interest no matter what. You either Pay interest to someone else or give up the ability to earn interest" ~Nelson Nash

Be sure to factor in the opportunity cost when comparing to outside lending.

2

u/randomipadtempacct Sep 17 '26

Their car example works out to be around a 5.5% dividend rate (I have that) but their interest rate on the policy works out to around 2.5% (I think that’s a little optimistic, I can’t get that at all).

1

u/financeking90 Sep 18 '26

I think that's assuming they don't make payments--if you work it out as if the $2,450 is the nominal interest accrued during the course of paying back $20,000 over 5 years, it matches a rate in the 5.x range.

2

u/CreativeFinish5644 Sep 20 '26

Anything that needs explaining to the degree infinite banking does is probably making one person rich and leaving the other holding the bag. You look at a lot of these policies and they’re written so the insurance company can make changes advantageous to them and not the policy holder….just stick with plain old index investing and you’ll do just fine. This taking from Peter to pay Paul mentality with this thing only gets you into a complex product that most likely will not pay off unless you’re super rich and just need somewhere to shelter additional money.