Infinite Banking
The Problem
The average American is paying
out 34.5% of every disposable dollar toward interest. If they
are saving 10% of their income (twice the average saving rate in
America) they are in a 3.45/1 ratio of interest to saving.
Rather than fighting to get a higher rate of return on their
savings and investments it might make more sense to change the
environment in which their money operates and capture all of
that lost interest by creating their on bank.
How Our Money System Works
There is only one source of
money in our banking system. It circulates from banks to lenders
to borrowers to banks and so on.
We finance everything we buy.
You either pay interest to someone else or you give up interest
you could have earned.
What if You Could Create
Your Own Bank?
First you would need to have a
funding vehicle. Then you would need to fund it. This might take
4 to 7 years depending on how fast you could build the equity.
Once your bank was funded you
could begin to make loans to yourself (or others) and you would
need to pay the bank back. By borrowing and repaying at current
or better interest rates you will be building a banking machine
that will eventually be able to handle all of the banking needs
a family might have; cars, education, homes, whatever. You would
be able to create an asset pool that would take the place of
Social Security, retirement plans and other market driven
assets. It would be a tax-free growth vehicle and it would be a
source of tax-free retirement funds.
This is not a new concept, but
one that has been available for over 200 years.
Please let me know if you want
to know more about this concept.
This information comes from R.
Nelson Nash and you can get his book,
Becoming Your Own
Banker, at
www.infinitebanking.org
This deserves your attention.
Equity Maximization
How would you like to put your
infinite bank on steroids? Another twist on the Infinite Banking
concept is to make sure you are using all of your assets for
future growth. Many of you have built up equity in your
homes and you feel good about that. Well, you should, but you
should also be smart about it.
What would not be smart would
be to consume that equity. Unfortunately many people have been
suckered into mortgaging their home to purchase things; cars,
boats, college educations and vacations. What will happen if we
have a recession, a real recession, (or you lived in the path of
a hurricane) and the value of your home goes down? You could
find yourself owing more than your home is worth. Worse yet, if
it is a real recession, you could find yourself without a job.
As someone said, that would not be a recession, that would be a
depression.
Equity in your home, left in
your home, has no earning power, zero, zip, nada. Your home may
be appreciating but the equity in your home is not earning one
red cent. What if you took the equity in your home and put it in
a safe, liquid investment that had a positive rate of return?
Well, if you did that your equity would be growing, providing a
source of liquidity that could make a house payment if you lost
your job and increasing in value so that you would have the
funds to pay off your house sooner.
That is the basic concept of
Equity Maximization. A way to provide safety, liquidity, growth
and ultimately a source of additional, potentially tax-free,
retirement income as well as giving you the choice and control
you gave up when you gave your funds to the bank or mortgage
company.
To find out more, I recommend
you read Douglas Andrews' book "Missed Fortune 101".
This book is the main source
for my seminars so please let me know if you want to find out
more about this concept. I would be happy to share more with
you, or better yet, attend one of our upcoming seminars.
Another book to look for is "Stop
Sitting on Your Assets" by Marian Snow. This
book is written from the point of view of a mortgage banker who
has worked with many high net worth people and seen how they
manage their home equity.
For a great summary of this
concept you can read the article:
How the Affluent Manage Home
Equity to Safely and Conservatively Build Wealth
Look for
Doug's newest book to be released June 12th
The Last Chance
Millionaire
It's Not Too Late to
Become a Millionaire
preorder at Amazon.com
