Premiums and early cash value
Ask how long you must pay, what happens if your budget changes and how much cash value is actually available each year. Early surrender can be costly.
SELF BANKING · CASH-VALUE LIFE INSURANCE
Infinite Banking: understand the policy before the strategy.
Infinite Banking, also called self-banking, uses participating whole life insurance and policy loans. Explore how it works, what it costs and what could go wrong before deciding whether it fits a long-term insurance need.
Ask about cash-value life insuranceNo-charge insurance conversation. No obligation to purchase. Availability is confirmed before an appointment is arranged.
Start with the insurance need and your budget. This strategy is not a bank account, an FDIC-insured deposit or a promise of investment returns. It is not right for everyone.
How does Infinite Banking work?
- Arrange life insurance: Coverage and premiums are designed around your protection needs, affordability and insurer requirements.
- Build eligible cash value: Premiums fund the policy under its terms. Early cash value may be limited; it is not the same as total premiums paid.
- Consider a policy loan: When sufficient value is available, you may borrow from the insurer using that value as collateral.
- Manage the policy and loan: Review premiums, loan interest, outstanding balances and effects on available benefits over time.
Possible uses do not establish suitability. A business expense, repair or family purchase still needs its own affordability review.
Costs and risks to understand first
Loan interest and benefits
Loans accrue interest. Outstanding loans and interest reduce available cash value and death benefits. Ask how the loan rate works and what happens if you do not repay.
Illustrations and dividends
Compare guaranteed and non-guaranteed values. Dividends are not guaranteed. Request lower-dividend scenarios rather than treating an illustration as a prediction.
Lapse and tax questions
Loans can contribute to policy lapse and potential tax consequences. Ask a qualified tax professional about your circumstances and Modified Endowment Contract (MEC) rules before funding or borrowing.
Insurance guarantees depend on the issuing insurer’s claims-paying ability. Request the actual contract, charges and loan terms before deciding.
Compare it with other ways to meet the goal.
Separate the need for life insurance from the need for readily available cash or financing. Compare savings, available financing and other protection choices, including cost, access and flexibility.
Maintain emergency savings outside the policy. Start with dependable surplus income, a long-term insurance need and the ability to pay premiums without depending on future policy loans.
For education expenses, compare dedicated savings options as well. For a business need, consider how the policy fits your business protection arrangements.
Questions before starting
Am I borrowing my own money for free?
No. The insurer makes a loan secured by eligible policy value, and interest applies under the contract. Ask for a written loan illustration.
Does everyone need this strategy?
No. Budget, liquidity needs, existing protection and alternatives may point to a different choice. A conversation does not require a purchase.
Who should help review the details?
A licensed insurance professional reviews coverage and policy design; a tax professional reviews funding and tax questions; your attorney handles any ownership, estate or business agreements. These roles may be separate professionals.
Already own a policy? Start with a life insurance policy review before considering a change.
Your situation. Your questions. Your choice.
Padua can help you understand the insurance questions and identify what needs further review. Gil confirms the appropriate professional, state authority and next step. Submitting a request does not book an appointment.
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Padua does not charge for insurance consultations or insurance services. If you purchase a policy, Padua may receive a commission from the insurer. Premiums and applicable product charges still apply. Tax work is separate: a free 15-minute introduction, then $285 per hour with scope and fees agreed first.
Keep learning
Educational resources, not endorsements, carrier-appointment claims or individual recommendations.
General education, not individualized legal, tax or investment advice. Policy terms, underwriting, costs and state availability apply. No approval, savings or outcome is guaranteed. Padua does not draft trusts or legal agreements. Read how our services work.