Becoming Your Own Banker For Canadian Families (Infinite Banking)

We're talking about the process and the function of banking. And we're already making all of the deposits. All of our money is already flowing to someone else's bank. And if I flow all that money to someone else's bank, then all I can access and all I can use is what is there. And the minute I spend it, it's gone. But if I'm capitalizing a system that will grow and compound over time while maintaining access to that capital without interrupting that compounding effect, 5, 10, 15, 20 years down the road, there's going to be a lot more capital in the system than what I've actually deposited. And now as I keep adding fuel to that system, it's just going to grow by more and more and more than what I'm depositing. I don't know any checking accounts on planet Earth that work that way, Liz. Usually when I put in the money in the checking account, that's all that's there. And when I wake up tomorrow, it's either the same balance or a little bit less because I got dinged with a service fee. Right.

Hi there. Welcome. Today we're going to be talking about becoming your own banker for families. So how does that work, becoming your own banker? How do we get started? What are the steps that we need to take? What are some of the things that we need to consider? My name is Vernon McCarty. I'm an authorized infinite banking practitioner through the Nelson Nash Institute, and I'm a member of the Ascendant Financial team. And I'm here with my amazing, fantastic colleague, Liz Lamond.

Thanks, Vern. I think we're going to start with a conversation talking about the fact that when they think about an insurance product, they're thinking about usually the primary income earner for the family. And while that's a really important place to start, we wanted to talk today about how this can be applied across the entire family spectrum. So whole life insurance can be put in from 16 days old right up through to 85 years old. So we've got the whole whole spectrum.

What you referred to is whole life insurance, which everybody on our team, what we refer to as a dividend paying, participating whole life insurance policy, which is, we refer to that as a tool. So we're talking about the process of becoming your own banker and implementing the process of banking. Well, if there's a process and there's also, we need a tool to implement that process and there's many tools that you could probably use to, to, to implement the process. Just like, you know, I could cut my lawn with a pair of scissors, but I'm probably better to have a ride on mower. I like to refer to my whole life policy system for my family as, as our ride on mower for implementing the, the process of becoming your own banker. If this is new to you and you want to learn more about the your own banker, this is the granddaddy of them all. This is the book that we learn from and that we study out of and we coach our clients on. So if you want to get a copy of that book, I'd recommend that you do so. And you can find a link to that in the description below. So whole life insurance is really important. And to Liz's point, part of our process is obviously to make sure that we have a conversation with our clients about how much life insurance do they need on their lives. But our primary objective is to solve for the banking equation. And the way that we do that is by using a tool called dividend paying participating whole life insurance. And to Liz's point, I've got everybody in my family insured. Isn't that right, Liz?

Yeah, that's right. Myself as well. And I think, you know, let's go beyond the why we would put insurance on children in terms of what we're teaching. We're teaching people how to create banking systems for their children. So it's something that the adult will be the owner of, but the life insured will be the child. And that you're able to use that in the same way that you can use policies where you're the owner and the life insured. And that's creating some savings and a banking system that you can use for your children's education and any expenses that come up in the meantime. But it's also something that they can use beyond their education so when they're buying their first car or putting a deposit down on a home. So understanding that the needs for financing for your kids is going to be long term, just like they are for yourself. And so creating a system that will be long term for them and they're going to get the benefits of, of compounding over a long period of time, it just is a game changer in terms of what you're creating in terms of creating wealth for your family.

Let's talk about the kids for a moment. Well, we have kids doing what these days. Kids are playing hockey, kids are going to summer camps, kids. Obviously we want to save for education. You know, we're buying gifts for our kids every single year for Christmas and Things like that. And what we're doing is we're taking that money, thousands of dollars per year, potentially depending on, again, what activities are in and whatnot. And, and we're working hard for that money as a family. That money comes in and then we permanently transfer it away from our family to solve the objective of hockey camp. Well, we're going to go to hockey camp anyway, and we're going to spend the money on the hockey camp anyway. So if we. Before hockey camp occurs, I don't know, Liz, maybe three or four years before hockey camp occurs, at 15 days old, if we put a policy on a child, and by the way, you don't have to put it on the child when they're 15 days old. If your child's 11 like mine is, you haven't missed the boat. But get started now, that's the most important thing. But we can put the policy on the child's life. The parent owns the policy, and now the parent maintains control. And that's how I can systematically transfer my own wealth to my child while maintaining control while I'm still young and healthy and building that wealth, because I can eventually turn that policy over to the child down the road when they're ready to do so. But in the meantime, while the values are building up in that policy system, I can actually access that value without interrupting the growth that's occurring on a daily basis. I can access that value by borrowing against the cash value, go pay for my hockey camp. And then, well, guess what? I need to save for next year's hockey camp. Or normally maybe you would borrow money from a credit card or something, pay for the hockey camp, and then you'd pay off that credit card. Well, in this case, I can borrow from my child's policy or any of the policies in my own system, pay for hockey camp, and now I can just make a payment back to our own family system so that we get to use and control over all of that money.

We're talking about a tool that you can use. There are different tools that are available for as it relates to your children's education. And we're just talking about a tool that you can use for more things than just the education, as well as the money isn't locked in during that time, so the money continues to compound, and then you have still access to liquidity for these other objectives that Vern was talking about. Let's jump a couple of generations, Bern, and talk about the grandparent stage. So is this something that grandparents can. Can do or people who are 65 and over. Does it work for them as well?

Vern I get this question a lot. I'll meet with people and they say, first question is, hey, Vern, you know, I'm in my 60s. Am I too old to get started on this thing? It seems like it'd be really good for the younger generation. And what I say to people is always this. I say, in the next 10 years, 20 years, as long as you're here on planet Earth, are you still going to be using money? And they say, yeah. I say, are you still going to be banking? And they say, yeah. I say, okay, great. Well, you can. There's nothing stopping you from getting started on implementing the process of becoming your own banker, because we have the need for the use of money for the rest of our days. And on top of that, Liz, the process of becoming your own banker, of course, it's meant to benefit us while we're alive and we're here today. I talk to people about what I refer to as the living benefits of life insurance. It's not all bleak and scary, right? But at the same time, if I get a policy on my own life as a great, let's say as a grandparent, then I can build up my policy values. I can use that while I'm alive to finance things, like I mentioned earlier in my own life. Maybe it's another vehicle, right? You need that vehicle or something reliable for the rest of your life, probably. But you also are again, you're spending money on grandkids and you're buying gifts and you're, and you're doing other things. You're traveling well, you're spending cash all the time to do that, and that's okay. But you're permanently transferring that money away. And one of the most unique, I think, and beautiful things about the process of becoming your own banker is it's about being able to do things for yourself today, but also to be able to keep the wealth in the family, the money that would otherwise be transferred away, and create a multi generational wealth effect. So while I'm older, maybe, and I'm implementing the process, I can access those values while I'm alive and enjoy those experiences. But all the while, I'm still building a large permanent death benefit so that there's a windfall of capital that will transfer the next generation to take care of any of my terminal tax liabilities or anything that occurs when death inevitably happen. And then I'm still leaving a windfall of cash for the next generation. And because we're Practicing the concept of becoming your own banker, that next generation is going to know exactly what to do with that money and not allow that inheritance to get squandered like it does in most cases.

Everybody has different kinds of family compositions. And something that comes up for me quite a bit is people say, well, I don't actually have anybody that I want to pass on a death benefit for. So does this actually even make sense for me? And so I wanted to address that and to what Vern said earlier, which is everybody has the need for money for their entire lifetime and we're talking about the living benefit of this. So I think most people understand that generally costs increase actually as we get older, needs for health care, other things like that. So having a system that is increasing in value such that it will meet your needs during your lifetime is valuable regardless of your family composition. So really, really important tool. And also I think I often speak to people about there may be a charity or an organization or somebody else that you want to make sure gets the benefit when you pass on. So there's lots of options as to what you can do with the death benefit. But also understanding that the main focus is the living benefit and the need for a growing pool of capital during your lifetime that you can access.

We're not talking about an investment. We're not talking about taking money and putting it into an investment and having the investment grow. We're talking about the process and the function of banking. And we're already making all of the deposits. All of our money is already flowing to someone else's bank. And if I flow all that money to someone else's bank, then all I can access and all I can use is what is there in the minute I spend it, it's gone. But if I'm capitalizing a system that will grow and compound over time while maintaining access to that capital without interrupting that compounding effect, 5, 10, 15, 20 years down the road, there's going to be a lot more capital in the system than what I've actually deposited. And now as I keep adding fuel to that system, it's just going to grow by more and more and more than what I'm depositing. I don't know any checking accounts on planet Earth that work that way, Liz. Usually when I put in the money in the checking account, that's all that's there. And when I wake up tomorrow, it's either the same balance or a little bit less because I'm not going to dinged with a service fee. Right?

What we certainly don't want is a dwindling pool of capital. Right? We want an increasing pool of capital. Really, really important. So let's kind of wrap it up then and say it doesn't matter of the st of life in terms of where you're at. This is a tool that can work for wherever you are on that spectrum of a family's different stages of life, including whatever your family composition is. If you'd like to learn more about how this process can apply to you, please click on the link that's appearing beside the video.