Is the Infinite Banking Concept a Scam?

Life Benefits designs, sells, and services high cash value participating whole life insurance policies, convertible term insurance, and fixed annuities in all 50 states.

What Is the Infinite Banking Concept? 

The idea behind the Infinite Banking Concept (IBC) isn’t new. People have been using participating whole life insurance to self-finance purchases for well over 100 years. 

Participating whole life insurance (PWLI) is a contract that is designed to remain in force for the policyholder’s entire life. It includes the buildup of cash values and also grants you the right to borrow against it. This can be especially advantageous for individuals looking to borrow for a business/investment and pay the loan back later.

The insurance company contractually guarantees to pay the beneficiaries of the policy a certain death benefit upon the death of the insured; and to share with policy owners (aka participants, policyholders) the excess profits the company generates. This sharing of profits is referred to as dividends but is considered a return of premium according to current tax law in the United States. 

Success Stories with IBC 

Life insurance has been around for centuries and thousands of people have borrowed against it and paid it back. We have encountered multiple success stories with individuals who have used the infinite banking concept.  

Fink’s Cigar Company 

One of our client’s expressed how her great-great-grandfather used his life insurance policy in the 1890s to access money so he could found a cigar company—Finck’s Cigar company. This company is still in business today. Read about the details here: How the founder of Finck’s Cigar Company self-financed himself into business with a loan from his life insurance policy.

Former U.S. Vice President 

Even the former Vice President has taken advantage of the infinite banking concept.   Read this financial statement released by the White House in May of 2012 and understand that former Vice President Joe Biden is using his MassMutual Participating Whole Life Insurance Policies similar to what the Infinite Banking Concept (aka Becoming Your Own Banker) outlines.

Is the Infinite Banking Concept a Scam

For one reason or another, multiple companies have deemed infinite banking a scam (also called the bank on yourself scam or infinite banking scam). So is infinite bankingscam, a Ponzi scheme or a fraud? No. Yet is IBC the best way, or the only way as some claim it to be, of taking advantage of this age old phenomena which allows you to collateralize the cash value build up in participating whole life insurance and use it to self-finance other investments, projects and purchases? The answer to that is a very definite NO! 

IBC has only been around since the year 2000 while people have been self-financing by collateralizing the cash values in their participating whole life insurance policies for well over 100 years! R. Nelson Nash the author of Becoming Your Own Banker: Unlock the Infinite Banking Concept boldly states that he didn’t invent this concept but only discovered how to use it for himself.


So is IBC the official or required method for leveraging the cash value build up which occurs in participating whole life insurance? No. Is IBC for everybody? Again the answer is, no. Many people desire more than just a mechanical methodology to follow and it is these people who we consult and who benefit from Life Benefits’ services.

Suggested Reading: Understanding the Infinite Banking Concept and How It Works In Our Modern Environment

Learn More About the Infinite Banking Concept 

We are here to help you create value, wealth and abundance in your life and the lives of those who you interact with on a daily basis. Winning Your Financial GAME with The Perpetual Wealth Code™ is our emphasis. We are not here just to sell you a life insurance policy because self-financing your investments, projects and purchases doesn’t require you to own a participating whole life insurance policy. 

At the same time owning participating whole life insurance will enhance your financial game and therefore we do design and sell the policies which will help you accomplish that.

Offer: Download Quick Start Guide