5 Essential Things to Know About Managing Your Money

So it's important to capitalize your system because remember, what you're doing here is you're creating your own private bank. And what does a bank need? A banks need capital, right? And so it takes around the first seven to 10 years to really capitalize your system to the point where the amount that you have in through your premium is equal to the amount of cash value access that you have within the system. That capitalization phase is a very important period because that's where your system is building live financial steam. And so once you get past the seven to 10 years, once you get to the seven to 10 years, most people think, okay, so that's how long I should be putting my premium in. And then I should stop after that. Remember what I said earlier? It's about how long you can keep putting the premium in, not how long can you keep the premium in for foreign.

You know, there's a principle out there that is talked about a lot in.

The financing world, or I should say the personal finance world, and that is.

The idea of creating an emergency fund.

Now, that is a brilliant idea.

I think a percentage of your paycheck or whatever ways that you make your income, a portion of that should definitely be put towards an emergency fund. Because you never know, right? In life, stuff happens, okay?

Stuff happens all the time.

And so in order to prepare for when stuff happens, you need to have a fund that can provide you with access to capital that you can use in those situations. So a very common place to keep your money or to reside that capital that is meant for an emergency situation. By the way, what do I mean by emergency situations? So emergency situations, the situations where stuff happens, it could be anything, as simple as a puncture in your car tire. And you got to replace your car tire to something as big as, you know, and I'm not wishing this on anyone, but a death in the family, right? These are situations where it's good to have money set aside to prepare for the situation. Common place to keep and save this money is in a bank account, okay? And when I say bank account, I'm talking about the big banks, and you have an account in there. And so that's a very common place. Most people think that if my money's in there, it's fairly safe, it's not subject to volatility. If the stock market, crypto, real estate, you know, doesn't matter.

It can go up or down.

The money is fairly safe.

Now, I would argue against that, especially.

After what happened in the recent times with the whole SVB debacle, the Silicon Valley bank. What happened in that situation where it was essentially a bank run and people were not able to get their funds out because everyone wanted their funds out at the same time. Now that's a whole different topic. And there's another video that talks about what happened there. So check that out. But I say that because when your money is in a bank, in a savings account, it isn't truly safe, okay? And watch that video again to understand why. And so then you may be wondering, okay, Taran, but where else can I put my money? I don't want to put it in.

Real estate or an investment in the.

Stock market or in crypto because it's going to be subject to volatility and risk. And I don't want to risk with that money because it's meant for situations where I need access to capital and I don't want to be in a scenario where, where I have to sell an asset at a loss. Okay? And then not get the amount that I initially put in. Right, Fair, Fair question. Where else can you put your money? Okay. Enter the process of becoming your own banker. The infinite banking concept. Okay? Now I'm not going to go into a whole lot of detail about what this process is all about. I'm not going to go into the nitty gritty. I'll talk about the high level for the nitty gritty. Watch IBC.com right below here is where you can understand everything that I'm about to talk about in further detail.

Okay?

So essentially what this, what this process is about, it allows you to have another warehouse where you could store your hard earned capital without being subject to market volatility in any market, or being subject to, to a bank run, okay? Because when your money resides in this warehouse, this warehouse is properly designed, participating, dividend paying, whole life policy. And so when your money is in this whole life insurance policy, which is the tool that is used in order to carry out the process of becoming your banker, you would have essentially created your own privatized bank. Okay? It is something, it is a warehouse which is outside of the current environment, the current system, the current banking system. It is outside of that. What makes it so special. It is a unilateral, binding contract between yourself and the insurance company. And so it is not subject to any sort of volatility. All right? And it is a warehouse where your money grows every single day in the form of the cash value. The cash value is a component within these insurance policies and they grow every single day. Why do they grow every single day. It's because by age 100, the death benefit and the cash value has to be the same. So every single day, this cash value is growing up and up and up, okay? And while that's happening, the insurance company allows you to. To borrow against it in order to.

Do whatever it is that you want.

To do in your life. In our example, for emergencies. So whenever you need access to capital, you can simply call up the insurance company and within a few business days, they will hand you a check or they'll direct deposit money into your account that you can use for that emergency. And guess what? The money that you. That they gave you, whose money is it? If you said it's the insurance company's money, you're absolutely right. The insurance company gives you their money and they hold your money in the form of the cash value as collateral. So your money's inside the policy. And remember the contractual guarantee I mentioned earlier? So your money continues to grow every single day like clockwork, while you get to utilize the insurance company's money to take care of the emergency that you had. And so now you have an emergency fund that grows every single day. While you can access it at any time, no questions asked, you just got to have the amount available inside for you to utilize. So here's another warehouse where you could store your capital in a safe environment, okay. And still have access to it at any given moment to take care of emergencies while your money remains in the.

Policy, growing every single day.

And this is the power of the process of becoming your own banker. Okay? Once you understand the process, what I talked about is a little bit of the tool, right? It's another warehouse. That's the tool. But you have to understand the process of becoming your own banker in order for the tool to make sense. Okay? Very similar to if you were given a hammer. You need to understand what is the purpose of the hammer before you can start using it. So check out watchibc.com learn more about the process of becoming your own banker. And as you learn about that process, you'll understand the problem that it's solving and you will understand what the tool helps you to do.

But Tehran, I can get a higher rate of return if I put my money into the stock market, the same money that I'll be putting in the system. Why would I do this? Why not just put it in the stock market and get a nice healthy 6 to 8% return every year? Well, then you don't quite understand the problem, okay? And the problem that this process of Becoming your own banker, the infinite banking concept. You can get the book on our website. The problem that this process is solving is not how much of a return can you get on your money, but it, what it solves is your control of your money. You see, when you make that investment, when you put your money into the stock market, what has happened to your money? Now you're probably thinking, oh, my money's in the stock market, so it's invested, sure, but do you have access to that capital?

No, you don't. You've lost complete and utter control of.

That capital because you have exchanged it for whatever stock or shares that you own. And in order to regain access to.

The capital, you would need to what, liquidate your shares. Right.

And when you're doing that, two things may happen. You, you may either liquidate it at.

A gain, which is great, or you may liquidate it at a loss, which is not so great.

And so your access to liquidity is limited because you've given away your capital, someone else has it, in this case the stock market. Right. And so what this process of becoming your own banker, the infinite banking concept solves is controlling the capital before you give it away. So before, I'm not saying don't invest in the stock market, but control your money first and then invest in the stock market.

So what I would do is I.

Would take the same capital and I would put it into a system which is the infinite banking concept, utilizing the.

Tool, the participating dividend paying whole life policy.

And once you've put it in there, you can borrow against the policy and then use those funds that you borrowed, which is not yours, is the insurance companies. Because your money is inside the policy. Use those funds and put that in the stock market. Okay? And if you're wondering what the heck did I just say, check out watchibc.com to get more insights on what this process is all about. What is the problem that it's solving and a deeper dive into the solution and how it all works. Okay, but by, in essence, by doing it this way, by flowing your money through the infinite banking concept, you are having your money work twice for you. Because your money sits inside the policy, growing in the form of cash value. And then the borrowed money against your policy is in the stock market. And here's the best part. You know, we always talk about the stock market going up over time and we talk about, you know, the return, but we don't tend to focus on what would happen if say you had it in a particular stock and the stock went down to zero. What would happen in that case? Well, if you use your hard earned cash, your cash is gone forever. You ain't getting that back.

Okay?

But if you took control of your cash first and you put it through the infinite banking concept system and you became your own banker and then you bought that stock, and if that stock then went to zero, whose money did you lose? Or whose money went down to zero? If you said it's the insurance company's money, you are correct because you borrowed the insurance company's money against your policy. And where's your money? Your money's inside the policy, untouched in the form of the cash value growing every single day. So your investment might have gone to zero, but you still have control to your control of your capital. And so now, yes, you would have to think about, okay, how am I going to make the policy loan repayments back. But that is fine because you're in a much better position than had. You just used your cash and your cash went down to zero. You still have an asset here. You still have your participating dividend paying whole life policy, which is an asset. The cash value within that is an asset.

Okay?

And guess what, your cash value keeps growing every single day regardless of what you did with the money that you borrowed. So now all you got to do is figure out how you're going to make the policy loan repayments back, and then once you do that, you regain access to all that capital plus whatever growth occurred in your cash value. And then maybe, perhaps at that time, you can consider another investment. But you see how in this scenario you are further ahead than had you just simply used your cash once again. If you use your cash and you put it into that stock and it went down to zero, your cash is gone forever. All right, so it's important to understand the difference between the two scenarios. And again, to learn more about it, check out watchibc.com and you'll learn more about the infinite banking concept. I encourage you to do so. Also check out the rest of our videos on the YouTube channel. On our YouTube channel, there is another video that I did a few months ago with regards to purchasing stock. Using this process, I go into more detail. I go into a Google sheet with numbers and all of that. So if you're into that, check that out.

So a question I like to ask.

My clients is, hey, this process to becoming your own banker process, the infinite banking concept, what is the problem that this process is solving now? I'll get a varying degree of answers. Okay? One of them, they'll explain to me, you know, what life insurance is, which is actually the tool, right? They'll say, hey, this process involves utilizing life insurance where I get to put money into a policy and then I get to borrow against it.

Great.

That's how the tool works. Okay, but what is the problem that the process of becoming your own banker is solving? Then I may get another response. And the other response might be, hey, you know what? It's a process that helps people.

Stop.

Paying interest to someone else. Okay, okay, okay.

So you're getting there.

You're on the right path would usually be my response. Okay, Another response that I get. The problem that it's solving is it gives me another option to finance something. I mean, I can, I have cash, I have, I can, I can get financing through a bank, and now I can get financing through my own bank. So I know I have another way of accessing capital. Okay, sure, yes, you have another option. But no, that's not the problem it's trying to solve. What is the problem that this process of becoming your own bank is trying to solve? Well, let me tell you the problem that it's solving. It's solving the way the money flows. It's solving the control of capital. Who has the control of capital? Okay, right now you make an income, whether it's through a full time job, whether it's through a business, whether it's through an investment, maybe you're a full time investor, you make an income. This income that you make, you've worked.

Hard to get it.

Even if it's passive income, we all know through passive income is not passive, at least when you start, right? You got to be active in making it passive. Right? So whatever income you make, where does that income reside right now? In someone else's bank. So you work your butts off to make this income, but it's someone else that gets it. Okay? Because when you have your money in someone else's bank, and when I say someone else's bank, I'm talking a third party institution like the big banks out there. Yes, it's your account, but it's not your bank, okay? It's your account in someone else's bank. So once again, you work hard, someone else gets the money, okay? So the problem this process is solving is it's helping you regain control of where your money resides, okay? It is keeping the money within your own system, within your own bank versus someone else's bank. Okay? And the way you would do it is through a tool. And that tool is specifically designed, participating Dividend paying old life insurance policy. Okay? And in order to learn more about the tool, more about the process of becoming your own banker, I suggest you watch our training below@watchibc.com it goes into a further detail. It's only an hour and a half where you can really capture the essence of this process first, right? The essence of the process of becoming your own banker. What the problem is, okay, it's, it'll.

Dive deeper into the problem.

I gave you a very high level, okay? Dive deeper in the problem. And once you understand the problem, the solution becomes very easy to grasp. If you do not understand the problem, the solution won't matter. Okay? So it's best for you to understand what this problem, this, this process is trying to solve. And once you get it, the light bulb should go off and you want to dive deeper into this. So check it out.

It's going to explain to you in.

Further detail about the concept, lay out the problem and then it'll lay out the solution.

A common question that I sometimes get is, hey, how soon will I get my money back from putting it into starting this system? And I now tend to flip my answer around because it's not about how soon you can get your money back, but it's how long can you keep your money in and how long can you keep feeding in more and more premium every single year? And that should be your focus because if you understand the problem, the problem from the book becoming your own banker, the infinite banking concept by R. Nelson Nash. If you understand the problem, then you'll know that you'd want to keep your capital in a participating dividend paying whole life policy, the tool that we use for as long as possible. Okay? Remember, this process is not about an investment. It's not about a rate of return.

It's simply about the control of capital. All right?

And so when we have our funds in this system, we are controlling our capital first. So why would we want to keep our funds anywhere else? And if it's a control of capital, we don't care about the return per se because it's not an investment, right? It's more or less a glorified way of saving your money. So it's important to capitalize your system. And Nelson Nash talks about it in page 65 of the book, the title of the page being capitalizing your system and implementation. And if you read through that, he talks about not being afraid to capitalize your system. Because remember, what you're doing here is you're creating your own private bank and what does a bank need? A banks need capital, right? And so it takes around the first seven to 10 years to really capitalize your system to the point where the amount that you have in through your premium is equal to the amount of cash value access that you have within the system. And so that capitalization phase is a very important period because that's where your system is building live financial steam. And so once you get past the seven to 10 years, once you get to the seven to 10 years, most people think, okay, so that's how long I should be putting my premium in and then I should stop after that. Remember what I said earlier, it's about how long you can keep putting the premium in, not how long can you keep the premium in for. Okay, so keep. The reason why it's important to keep putting the premium is because it's around the 7 to 10 year mark. When your system reaches a point where it starts to exponentially rise, the amount of cash value starts to exponentially rise.

And if you stop putting premium after.

The seven to ten year mark, then what will happen is you're going to slow down the growth and all that energy, all that financial energy that you built up over the past seven to 10 years would have gone to waste. So keep funneling in that premium because remember, all you're doing is you're just changing where your money resides. That's it. Just flow it in through your system and then use it for whatever it is that you need to use it for. Keep capitalizing the system. Don't be afraid to capitalize. And once it's capitalized, keep capitalizing the system.

Should I get asked quite a bit is later on, what if I'm uninsurable? What if I'm not able to take out a policy on myself? Then what?

And my response to that question is.

Well, first off, the best thing to do is to try first so to go ahead and apply for that policy and see if you are truly insurable or not. Because you'd be surprised. Life insurance companies underwrite policies a certain way. And so who knows, maybe you fall under the category of being insurable, given whatever it is that you have that makes you think that you're not. But in insurance companies, as you might be. So my immediate response would be, you know, the only way to find out is by trying. Now what if you truly aren't unsurable, then what? Now if you go through that process and you realize that, know what, you actually aren't insurable, then we can fall to the next option, the Next best option, next best option. And that option is to find another body, to find another life that you can ensure. Okay. And Nelson Nash, actually Arness and Ash, the author of this book, becoming your own banker actually talks about this in page 82 where the title of the page is actually what if I am insurable? So I encourage you to give that a read because he goes through an example of a father and a daughter where the father was uninsurable and he was able to take out a policy on his daughter and he was able to implement the process of becoming your own banker using his daughter's policy. Now I'm not going to get into details of all that encourage you to give that a read. In order to understand what this process, becoming your own banker is all about, I encourage you to check the link below with watchibc.com, and it'll get into the details of what the process of becoming your own banker is all about. At a very high level, the process is about taking control of the banking function. So encourage you to watch that on demand training and it'll give you a good glimpse of everything related to becoming your own banker. Now when it comes to ensuring another person's life, there's a couple things you want to keep in mind. So it just can't be anyone off the street. You have to have some sort of connection to that person or relation to that person or as the insurance company calls it, an insurable interest. So an example of a life that you could get insured, another life that you get insured can be anyone from your family, your immediate family or even family members like a cousin or aunt or uncle. Those work as well. Insurable interest can be business partners. Insurable interests can be joint venture partners for the real estate investors out there. Interval interests can be employees as well. In your business you could take out insurance on key person individuals inside your business. For example, an example of a key person would be someone that is who's whose work is detrimental to the flourishment of the business. So for example, you know, you may have a salesperson that in your business that is key to you acquiring new clients. And you know, knock on wood, if that's something happens to that salesperson, you probably agree that that would be detrimental to your business. So in that scenario you could consider taking out a policy on your salesperson there and then you could use that policy to implement the process of becoming your own banker within your corporation. And there is additional videos that talk about that talk about breaking out policies when we're in a corporation, so check that out. But, yeah, so don't feel discouraged when you're learning about this process and maybe you're dealing with some health issues and you feel that you're not insurable. Don't let that discourage you. What I'd first encourage you to do is really grasp and learn this process of becoming your own banker and, and see how it works. See why this process exists and what is the problem that it's solving. Understand all that first. And once you understand that, then the solution becomes easy to understand, and then we can talk about, you know, who to put out a policy on to start your system. Okay? So before even jumping there, just focus on learning this. Focus on understanding this, because you know once you understand it, then the solution will matter. Otherwise, you're jumping to the end without going through the understanding of why you're doing this in the first place. All right, so the answer that question. If you feel like you're uninsurable, don't worry. There are many possibilities. But first things first. Learn and understand the process. Becoming your own banker.