Family Banking: Keeping Your Wealth Where It Belongs

Look, nobody's questioning your priorities in terms of where you want to allocate money that flows through your hands, not into your hands, but just with a slight change in allocation, you can begin to create a pool of capital. And you can do this not just at the you and me level, but you can do this at your family level, because everyone in your family needs the use of money. And so what better place to have that money flow to?

Thank you.

Then back to the family. Okay, let me hit you with something. You ever stop and wonder, just for a moment, why every time you make money, it kind of just disappears. So one minute your paycheck hits the account and the next it's gone. Whether it's mortgage payments or car payments or loans or in our case, random Amazon purchases at 2am but you know whose money doesn't disappear? The banks. They make billions. They make billions off of deposits that other people leave there. And so think about it. The bank takes your money, the bank lends it out, charges interest, and then what do they give you back? Not a whole lot. I think it's about a fraction of percent in interest, which is like ordering a steak and the waiter brings you a picture of a cow. It's not very appetizing. And so rich. Let's dive in. Let's talk about what we've outlined in one of our books, and I'll invite you to reference the page number in the book that we're talking about. Now, given that this book was originally written for, you know, Canadian readers, this is applicable to the American folks that we serve. It's no different. Why don't you kick us off and talk to us about, you know, why this is a problem?

Well, we'll talk a little bit about why it's a problem, but we're also going to talk about, I think, a solution to that, which is integrating your. Integrating your family lineage to people. And, you know, we say family, then we think, of course, about the biological aspect. But for some people, they're friends, they're. They're close acquaintances, and colleagues are extensions of their family. But so think you can think of in that broader scope if you want. But we're finding a way to keep the money inside of this internal aquarium, a system where it never leaves and escapes your method of control. That's really the solution that we're looking at. So we. Our first book, Canadians Guide to Wealth Building Without Risk, of course, works just as well for Americans. In fact, we may be releasing the book with some modifications for Americans. This whole book we have a chapter in this that's called the family. It has to do with family banking. It's the power of family banking. And we've got an image there that we kind of discuss this to give people, like that visual understanding of how we can link these things together a little bit. But fundamentally, when you have this flow of financial energy coming into your life and then it's flowing out, you know, I, I did a live event here recently, Jay, and I use this example. You know, have you ever seen on your outdoor tap, you can buy these like a diverter, essentially. So you, you know, you screw it on your outdoor hose bib, and then. And you can make water go this way and go this way. So you can connect multiple hoses and they have, like, their independent valve on it. So you can have some water diverted that direction and diverted that direction. Now, when you do that diversion, if you turn each one on, let's say halfway, you get a lot less water pressure going both directions, right? But there's still water flowing in both directions. So just imagine that you had this tap, and right now all the water is coming out of the tap, and it's all flowing out of one hose, and that hose is going into your regular bank, right? That's what's happening with your money today. So now you're going to go and take the hose off and you're going to add the diverter on there. So now you can, you can adjust or to begin to adjust the flow of financial energy so some of it can divert the other direction. So, so you're starting to take the pressure off of what's going to the regular bank, and you're starting to slowly, over time, increase the diversion of water and the pressure that's now going into your family system. That's. That's the model that I want you to think about as you're. As you're listening to this. It's not going to happen overnight. You're going to have water going both directions. And, you know, some points in time in your life, you may actually have to say, oh, geez, we have to go backwards a little bit. We have to turn the diverter back on over here at the regular bank for a bit. Right. We want to be able to control. You want to have that independent mechanism of saying, how much flow do I want going this direction or that direction. You know, banks use other banks all the time. They have overnight lending. They work with one another to support lots of initiatives. There's no reason that you can't use another bank's money to go do something that you want to do. But the difference between having to use it and choosing to use it, okay, really important. I want everyone listening in to really pay attention to that. There's a difference between the requirement that you have to use someone else's money and you have to beg, borrow, steal, do whatever you need to do to get access to the capital because someone else has developed a big pile of money and you don't have a pile big enough to tap into on your own. What we want to move you from is a requirement to do to the choice to do. That's a part of what this process is all about as you learn it in your life.

I love that. And we went on further to expand on the family banking system in our latest quarterly book release titled Don't Spread the Wealth. We're going to put a link in the video. In fact, you may have already seen it come up where you can just get that link. Go directly, get your hands on a copy. The book takes 90 minutes or less to read. It's a quick read and it's intentional because we want to create insight and questions and conversation. And so be sure to get your hands on a copy of this book as you're watching this video and you find yourself thinking, okay, I really want to dive deeper into this as it relates to my family. Just head on over to the link that you see on the screen here and get your hands on a copy of this book and we'll ship it wherever it needs to go.

Yeah, don't spread Wealth.com is a great place to go get it. Now in that environment, you'll also get access to some great bonus material. Jason. There's a whole 15 page guide on recommendations and a, and a model on how you could begin hosting family banking meetings in there. It's a great start to help kick off these conversations with your family members or your close associates, the people that you most love dearly, that you want to embrace and have them embrace this concept with you in your life.

So let's start teaching. Let's talk about it. What are the five phases of the family banking business?

What we're seeing here is kind of the timeline phases of life. Again, where you're starting at is where you're starting at. We don't know what your age is or where you're at, but this is looking at the typical journey of, you know, the average North American. You're here, you're, you're, you're single, you're doing life, you're trying to get out there and make your way in the world. Eventually you get a spouse, you get married, you, you're buying groceries. Sooner or later you have a couple little rugrats, you know, for Jason, you have, you have two and then you end up with twins. So you double the size of your family very quickly. Like that happens to many people. And then your family and the people around you expands. They have their own children. You get this big nucleus and it builds and builds and builds. So these are the different stages of life. It really begins here at capitalization. You can't have something if you don't get it started. Putting some capital in, in our, in our diagram here, what you'll notice is you're seeing, you know, this arrow with, with money going in, you have to put something in to get it started. You're going to start that business structure. So referring to Nelson's book of becoming your own banker, he really identifies this a lot. In the grocery store example on page 15 and 16, he expands on how what we're talking about, there's. Yeah, you also see an arrow here where your ability to access capital. So this would be like taking a policy loan or the ability to tap into your system by using the power of collateral. You may not have access to the same amount that you put in. Notice that the arrow size isn't as large. So just giving a representation there. Because we're in that build up phase now, we're moving on. You're getting a lot of practice. You're moving through different stages of life. You have different life needs, a lot of buying, a lot of expenses, a lot of activities, investments in your future that you're making vacations, all of the amazing things that going to do in your life. You're still continuing that capitalization. You continue doing it because you got a lot of life ahead of you. But you're able to access more and more from that system as you begin to grow through time. Now you start developing your family, you have new people coming on board. You're continuing to capitalize. You've built in really solid habits. You have conquered Parkinson's law that Nelson talks about in his book. You really spent time working on your behaviors and because of that you're going to continue funding your system, putting premium into place, capitalizing on an ongoing basis like clockwork, because you recognize the power of what it's doing. And now you're able to access and tap into the same amount that you're putting in greater as you begin building throughout your system. Then we shoot forward to a later stage in life at passive income time. Your deposits of premium, your regular recurring injections of capitalization have never changed. But, but the amount of volume of capital you have access to has changed. You have way more accessibility because you had this consistent process over time. That's kind of what we're looking at as we carry this forward. Eventually we're going to be talking about one another, Jason and myself. You watching this right now. We're going to be talking about you in the past tense. You're not going to be with us anymore and neither will I. We're going to have a legacy event there. Nelson called it graduation. And when that legacy event happens, it's going to happen regardless. Is there going to be a big fat chunk of lump sum money that shows up to solve problems when we go or is there not going to be the case? That's up to you to decide. It's only you that can dictate and control those terms. This is just understanding how you can do it effectively and efficiently while maintaining control over life's usage of money. So when that graduation happens, we're going to see a tax free event and then we're going to see capital come all the way back in and re engage with the system where now you have these other younger family members, your own children, your grandchildren, they're in perpetuity, continuing that on. They're going to receive this injection of capital. And if they know what to do, they understand the stewardship that's required, they have the mindsets necessary. They will continue that cycle and they will move through that same process that you did, and then they're going to see that cycle repeat. And we're going to get into this repetition zone. But that repetition can only take place if we have the right things in mind. And it's not about the financial vehicles we're using, it's about the mindset that we're implementing at the family level and with the people that are participating inside of this structure that we're talking about.

And if you think in addition to, you know, what you just described, so recognizing first and foremost a fundamental truth, right, that your money must reside somewhere and that everyone in your family is going to need the use of money for the rest of everyone's lifetime within the family. And you have a need for finance for things like vehicles, property, appliances, weddings.

Homes.

Cars, RVs, the list goes on. Anything that you can think of that you would otherwise pay cash for lease or finance? Well, when you understand that you're doing all the work to earn your income. And you're not keeping any of it because you're systematically transferring it away through every financial transaction in your life. And all that money ends up on the books of someone else's bank, which is where it landed to begin with, when you got paid. That's a problem because it's unnecessary. And the solution to the problem that you've described around the infinite banking concept is taken to a different level when you're describing the phases. So capitalization, you're paying premium into dividend paying life insurance contracts, ideally a system from a reputable mutual life insurance company. Then you're at the point where you're implementing the process. You're actually gradually and incrementally taking control of the banking function as it relates to your needs. So you're in process, you're accumulating more and more capital. The family's money pool is continually growing and getting larger. And when you get to the point, I'll just skip over and you get to the point where it's passive income time and you know that you're going to get back out more capital than you put into the system. You're going to do it on a tax free basis so you don't have the government hovering over those assets with a giant knife and fork waiting to devour them. The family understands that everyone's going to pass away at some point. It's not a matter of if, it's when. So if you're diversified in lives insured, when death comes, the family's money pool gets replenished. And in simplicity, if you know that using the best tool to get this job done, which you've just, you know, you've described and I, I've described if you know you can contribute almost unlimited sums, you pay no tax on the daily buildup, you have capital that is accessible on demand, on your terms, without reducing the asset's value and without triggering a taxable event. How much capital do you not want residing there? If you think of your diverter example, do you want partial diversion or do you want gradual and incremental and eventual full diversion where everything is diverted into the family banking system and from that base of operation, financially, the family can achieve everything that it needs to achieve as it relates to the all the things that you need to finance throughout the course of your lifetime, including investments?

Well, I think we can take that example and we can actually even expand it one step further. So you know, when we're done this recording, Jay, it's a beautiful Day outside in Chilliwack. We have a hot tub here at our house, but we need to go and clean it. So when I'm done here, I'm going to go help my wife take care of that. And, you know, imagine you've got this diverter. Now we've managed to turn off the flow of energy going to a third party.

Yeah.

And we now have 100% of the diversion of that flow of energy coming into this. This other direction, this other hose. But now what if that hose were also deposited into a large basin, a containment facility. So, like an example is a hot tub or an aquarium. Okay. Now we have a circulation pump that's taking that energy and it's cycling it. So now we're containing it and we're building it up. And we have. We have a warehouse of it. We have new money coming in, new flow. There's new income being generated. Income from, you know, let's say my children, my grandchildren, the, the. Their spouses, and, you know, myself, passive income, real estate, all these, you know, books that we sell. There's all these things that are creating income streams. That's that flow of energy coming in. Okay, the money that's coming in and landing on the books of the banking business. And then there's the containment facility. So that containment facility, and it's recycling that capacity. So, yeah, you got to clean it every once in a while. You got to make adjustments, you got to make tweaks, you got to modify. You got to. You got to shock it every once in a while. That might be a family banking meeting where you bring everyone around the fire, you know, and you have a conversation about, hey, you know, little Sally, I know that you didn't make some loan repayments recently. So we're going to shock the system and have a good discussion about that. You're keeping everyone accountable to making sure they're managing and maintenancing that pool of money very effectively. Because even if you think about a swimming pool, swimming pool is a big, giant filtration system. A lot of it. Yeah, there's new stuff that comes in, but a huge amount of that is getting cycled through. But it's going through a filtering process. But if you don't clean the filters, if you don't go in and maintenance that pool, it's going to be shut down, and nobody can use it in the whole community. Nobody can use a pool for months and months and months because it's got to go through, you know, big renovation to fix everything. The same way that that happens in the community pool, that's happening in your money system, right?

Yeah, really good point. And we in again in our book titled Don't Spread the Wealth, we tackle that on page 75 where we start to talk about how to conduct, you know, your family banking meeting. And when people, when they're first introduced to the infinite banking concept, it's, it's something that's very unique. It's, wow, okay, help me understand what it means to become my own banker. Like, what is that? What does that even mean? And if you think about the essence of controlling how you finance the things that you need throughout your lifetime, recapturing the interest that you would otherwise pay to someone else's system, to some other finance company, and that money ending up inside of an entity where you never lose control. And so as a viewer, if you were to think to yourself, what disadvantages would there be to being in a position of total control as it relates to how you finance the things that you need in your life? Think about something as simple as a car. When you go to buy a car, and this is something that rich, you do a great job of sort of walking through the options of, you can pay cash, you can lease, you can finance, you can utilize the infinite banking concept method or steal it.

We don't recommend that.

So if you were to think about this going in the direction from that you see here on the video, if this is cash lease, finance, infinite banking concept theft, well, most people, if I'm talking about 99.9% of North Americans, they're going in the, in that direction as it relates to how they buy cars. With leasing actually now in front of the financing option, like leasing is up significantly. All three of those methods, paying cash leasing or financing, involves a permanent transfer of money away from you. Think about it, when you pay cash, you pay cash. Poof, the money's gone, you got the car. When you lease, you're essentially renting something that you may never own. Every payment you're making is someone else's passive income. And when you finance it, you're repaying it on someone else's schedule, on their terms, not yours. And you don't own the damn car until you make the final payment. So what's the difference between someone who paid cash for it and someone who financed it? You both end up back at zero. Why would you want to be in that position and posture financially if you could pay premium into dividend paying life insurance, accumulate cash value, borrow against the accumulation without interrupting it on demand, on your terms, Go and buy the car. The car. The lien for the loan is not on the car. It's on the death benefit of the insurance policy. You own the car. The loan's not reported to TransUnion or to Equifax. It's a private loan. You're not interrupting any of the daily growth of your cash value. You still have a permanent death benefit, which you didn't have in either of the other three options of buying the car. And God forbid, if the unthinkable happened to you, your family still owns the car, there's no indebtedness left behind, and you've got an ever increasing pool of value that can't be repossessed. It can't go backward. So again, tapping into our logic, how much capital do we not want residing inside of an entity like that that we control?

Well, in that car buying example, I mean, especially if you're like the person who's using the illegal option of acquiring a car and stealing it, not only do you not have any death benefit, you might have a death wish. Actually so very different. And to taking that one step further, you know, we learned from Nelson that in the. You said leasing is up. Yeah. Well, just think about it very logically. If, if you're going to lease someone else's equipment, right by default, it's not yours, it belongs to the other party. So the other party is the owner. Is the owner a fool? You don't think that the owner of the equipment is going to get their monies back out. Out of you, like by default? You should recognize that you're going to pay more for the lease than if you owned it and financed it with a third party. So if leasing is up, that should tell you that a higher percentage of the flow of your financial energy is going away to a third party. Now, if that third party is some other owner, great. Maybe that's better than the banking system, but probably not much more. So, you know, you. It's really about control. How does the control about the flow of energy, the diversion of that flow towards a source that you have control over or do not have control over, that is really the essence of what we're talking about. You being in the driver's seat of literally, we're talking about buying cars. You're in the driver's seat, but what about the driver's seat of your money? It's the car that never stops moving. It's the engine that's flowing throughout your life, your whole lifespan. How much of that are you controlling? That's really what it boils down to. Yeah.

And it's a desire. It all begins with desire. Much like the late R. Nelson Nash outlines in his book becoming your own banker, he says it all begins with desire. Because presently, anybody viewing this is already allocating 100% of their financial resources to everything that they've deemed to be a priority. And what nobody's discussing is that, look, nobody's questioning your priorities in terms of where you're, you know, where you want to allocate the money that flows through your hands, not into your hands, but just with a slight change in allocation, you can begin to create a pool of capital. And you can do this not just at the you and me level, but you can do this at your family level, because everyone in your family needs the use of money. And so what better place to have that money flow to than back to the family? And so this is where we, you know, we dive deeper in the book. Don't spread the wealth. The link will pop up on the screen. Just head on over there, get a copy. We'll courier it wherever it needs to go. It'll take you less than 90 minutes to read it. And it could be the domino that tips over to your bigger financial future. And so, Rich, these conversations are always fun. And to everybody watching on the YouTubes, you just saw another video pop up, and that video is there for a reason. We want to encourage you to continue your journey of learning to stay on the platform. There's no such thing as having arrived in knowledge, so don't ever be too cool for school and get your hands on a copy of this book.