Chapter 10 – Financial Freedom

Brian Tracy once said, “There are three legs to the stool of financial freedom: Savings, Insurance and Investments.” And infinite banking has it all: Savings, which is pay yourself first (Save 10% of what you earn). Investment, which is pay yourself interest. And the third component is insurance, that is you should get back all your principal and interest, in other words recapture. And this is only possible through an insurance company, inside an IBC account.

Make sure you, “Own your tomorrow by turning liabilities into Assets.”

What are the 3 rules of Financial Freedom?

So, the three rules of financial freedom are: savings, investments and insurance.

The rule of savings says, “Pay yourself first.” The rule of investment says, “Pay yourself interest.” And, the rule of insurance says, “Never lose money.” And the only way you can benefit from all these three rules simultaneously is inside an infinite banking account. And that is the secret to our financial freedom.

By now, you must have heard the three rules of financial freedom given by Brian Tracy: savings, investment and insurance.

1. The rule of savings says, “Pay yourself first.” 
2. The rule of investment says, “Pay yourself interest.” 
3. The rule of insurance says, “Never lose money.” 

In other words, “Insure” your money by “making sure” you get back all the principal and interest that leaves your wallet month after month, and year after year. Also, ensure that you have a death benefit, in case something unexpected happens to you. And, the death benefit insurance element is already “built-in” here.

In regard to Rule #3, Mr. Warren Buffet says:

There are only two principals of money:

1. Principal number one is, “Make sure you never lose money,” 
2. Principal number two is “Whenever in doubt, refer back to principal number one.”

Now the question is, “How can someone make sure they never lose money?” The answer is found in these two words: “make sure.” In other words, “ensure.” The only way to ensure something is to insure it. And thus, we reach the insurance component.

The secret of infinite banking can be summed up in two simple words, recapture and reinvest.

Recapture by getting back all the money that is currently leaving your portfolio and re-invest it in an insured and guaranteed vehicle.

The whole infinite banking premises rotates around compound interest. Now you might ask where do I get a guaranteed compound interest? And the answer is, “There are only two places that you can get compound interest with certainty – either a bank CD or a whole life insurance policy.”

What? What in the world does insurance have to do with what we’re talking about today?

Well through this series we have been building on the idea of you being able to earn compound interest and we need to be able to tell you where you can get it. And you can get it through a whole life insurance policy. And the reason why whole life insurance was suggested is because of the reasons that we discussed when comparing the bank CD to a whole life policy.

When you pay a life insurance premium, there is cash value or liquid cash that grows based on what you have contributed within your premium and the money that grows in your account, which is considered cash value growth at a tax-free rate and if you utilize it in the form of a loan, it is tax-free distribution so you are not claiming any income on that money. The guaranteed values are super important to understand because they are paying at a guaranteed compounded interest rate and if you choose to do business with a Mutual Life Insurance Company, they will also send you a dividend check at the end of the year. And it all happens because of a factor here called non-direct recognition, which is built into your whole life policy. The other thing to note is that you have a complete control of your policy.

This isn’t like a retirement account where you are penalized for utilizing it. It wouldn’t surprise me, if you said, “I don’t like those RMD’s (Required Minimum Distribution) in my retirement account.” The other most important thing is the measurable history of success, that how they have been sending people a dividend check year after year, some of them for as long as 100 years.

Well I know what you’re thinking if this whole life insurance product is so great, who knows about it and why haven’t we been taught about it? Well we’ve got that covered too. Let’s look at government officials like the former Vice President Joe Biden with 19 million of cash value in his whole life insurance policies. When I say cash value, again, I mean liquid cash that he can tap into at any time and this is tax free money. Then again, the late Senator John McCain actually funded his presidential campaign with the money from his whole life insurance policies, tax-free money.

How about fortune 500 companies? They have utilized whole life insurance to either fund their business or are continuing to fund their business through their whole life insurance policies. Walmart, Disneyland, Home Depot, McDonald’s, AT&T, CVS, Nike and JCPenney to name a few.

I have talked about the government; I have talked about corporations. Guess who else knows about this? That’s right, the banks. If you do the research on your own you will find Citibank has $4.5 billion, JP Morgan Chase has $9.8 billion, Wells Fargo has $19.3 billion, Bank of America has $18.5 billion. These numbers represent the cash value that banks have access to. Again, tax-free at their disposal.

The banks want us to go in debt so that we can create a form of cash flow for them by paying them back every single month and they want our money to remain in the bank accounts so that they can utilize our money to make more money. We want to work alongside them. We don’t want to play in their game and buy the products that we have been sold as consumers. And that’s where Infinite Banking comes in by enabling us to become our own banker.

If you want to learn more and get our book for free, visit https://sunnymitra.com/.