How and what is Infinite Banking used for Real Estate.

[Yoochul C.]

Some of you might have heard of the term Infinite Banking before.  There are the naysayers like Suzy Orman or Dave Ramsey but it is a viable strategy for real estate investing.  The strategy is simple, using a whole life insurance policy when structured correctly can be a viable option to park cash for a future date when you need it for a down payment.  The way it works is that when structuring a whole life policy, you'll want to minimize the premium and maximize what's known as a paid up addition (PUA).  My adding money into the PUA, you'll build up a cash value much faster.  This cash value grows tax deferred and the income you take out is also tax free.  Also the money that is taken out as a loan does not affect the the cash values ability to grow.  It is similar to a home loan, when a home is paid off, the home still grows with inflation and market fluctuations.  When you take out a loan from the home, the home still appreciates at the full value of the home.  You can choose to pay back the loan from the whole life policy or not.  If you do not pay it back, the amount of the loan is subtracted from the death benefit.  In essence this is a great way to grow money tax free.