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BetterWealth with Caleb Guilliams

The Actual Rate of Return of Infinite Banking | Whole Life Insurance Calculator

Aug 18, 2023
This podcast introduces a calculator to determine if whole life insurance is suitable for your financial goals. It explores the multi-dimensional benefits of life insurance, including tax-free growth and control over assets. The podcast discusses the rate of return of infinite banking and the advantages of borrowing against a life insurance policy. It also explores the pros and cons of life insurance as an asset, including safety, liquidity, and tax benefits. The podcast discusses the drawbacks of whole life insurance, such as lack of tax deductibility and the time it takes to break even.
15:40

Podcast summary created with Snipd AI

Quick takeaways

  • The internal rate return of a life insurance policy can be accurately determined using a calculator, taking into account factors like long-term growth and tax-free growth.
  • When borrowing against a life insurance policy, it is crucial to consider the cost of borrowing versus the potential return, factoring in the level of risk involved.

Deep dives

Section 1: Internal Rate Return

The first section of the podcast focuses on the internal rate return, which represents the growth of a life insurance policy. By utilizing a calculator, individuals can compare different policies and understand the actual growth rate. The internal rate return accounts for factors such as long-term growth and other relevant factors, providing a more accurate representation. It is highlighted that life insurance offers a tax-free growth, making it a beneficial option when compared to other assets that are subject to taxes. The calculator takes into account the internal rate return, taxes, and other inputs to determine the required interest to maintain the life insurance rate of return.

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