Infinite banking is a financial strategy that uses whole life insurance to build cash value.
It allows policyholders to borrow and grow wealth like their own personal bank.
Key Points in Infinite Banking
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Personal Banking System: Use whole life insurance to create your own banking system.
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Tax Benefits: Grow your wealth tax-free through policy loans.
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Guaranteed Growth: Enjoy consistent cash value increases over time.
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Dividend Earnings: Gain additional growth through policy dividends.
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Financial Control: Maintain full access and control over your policy’s cash value.
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Legacy Building: Transfer wealth to future generations tax-efficiently.
Infinite Banking Calculator
Thisis a powerful tool to help you analyze your whole life insurance policies.
To know about your investments then this is perfect for you, just enter your policy
details in the input bar:
| Year |
Cash Value |
Annual Contribution |
Loan Balance |
Loan Interest |
Loan Payment |
Net Value |
Total Returns |
The minimum amount varies by insurance company and policy type, but it starts at $300-500
monthly or $3,600-6,000 annually.
It takes 3-5 years to build the cash value, because the first few years have lower
cash value due to policy setup costs and commissions. After this period, cash value growth
accelerates due to compound interest and dividend payments.
Policy loans allow you to borrow against your cash value while your policy continues earning
returns. The insurance company uses your cash value as collateral. You're not withdrawing money,
but borrowing against it, which maintains the policy's growth. Loan interest rates may
5-8%, but your cash value continues earning returns.
While whole life insurance policies have guaranteed cash value growth. But, poor loan management can
reduce your policy's value. Loose money means default in premium payment, excessive policy loan,
non-management of loan interest, premature surrender of policy.