How I Discovered Infinite Banking – 001 transcript
Eric Kouvolo: Well, welcome everyone to our inaugural show about infinite banking and some lesser known financial strategies. Today, we want to answer some of your questions and one of our co-hosts here is Frank Riedel. He is the founder of Hurricane Financial and an authorized infinite banking concept practitioner. Say hello, Frank.
Frank Riedel: Hey Eric. How’s it going today?
Eric Kouvolo: Doing well. Yeah. I’m excited about this show. I think a lot of people have been hearing about infinite banking and they’re wondering, “What is this? How come I’ve never heard of it?”, so I think we’re doing a great service to people. We’re going to start a show and hopefully answer some of those questions.
I like to start with, why, according to Simon Sinek. He said, “What is your why?”, and after discovering infinite banking, I discovered that, basically I’ve been following the wrong advice from the wrong financial experts, so I really just want to help improve the lives of others, based on this banking concept.
Frank Riedel: Well, you know Eric, that’s very, very true and that really hits home for me because I personally have been utilizing an infinite banking strategy myself, in my own household for a number of years. And what really brought me into this from a, let’s say a more professional standpoint was, I saw so many people in the industry … Now, I have an estate planning background as a certified estate planner. I started looking at what other people were doing in the world of financial planning and life insurance and various other industry-related concepts. And a lot of people were talking about infinite banking, but very few people seemed to understand it, and being that I was utilizing infinite banking myself already, I had no misconceptions.
I was pretty clear on how it worked. I put in my time to study. You know Eric, I was amazed at how many people that I ran into that were just simply trying to sell insurance and packaging it under infinite banking, you know. I just thought, “Wow. What a disservice.”, you know. Infinite banking to me is a whole lot more than just an insurance vehicle. I would even go as far as to say, infinite banking is … When you look at the concept of infinite banking Eric, what is always amazing to me is that infinite banking is really about everything that happens in your life, conceptually, places where your money is flowing away from you and you’re losing dollars or you’re paying interest to other people.
It’s about the other areas of your life. The actual policy portion of it, is a small part. It’s kind of a catalyst in which you run everything through, but I think what I’ve been hearing in the industry is people really offering it the other way, and trying to offer it as some type of miracle insurance product instead of a banking concept, that is what it is.
Eric Kouvolo: Yeah, and people have never heard of this, or a lot of people, myself included. I was a finance major at a large university and the whole insurance concept, the whole banking concept was never even discussed. So maybe tell people about how you discovered it and I can also share my story as well.
Frank Riedel: Well, it’s interesting, you know. Like a lot of people, somebody handed my a book. I was given a book called, “Becoming Your Own Banker”, by R. Nelson Nash. Great book. I read it, and I was actually traveling when I got the book. So I was actually on my trip when I started reading it here and there. And I found myself at one point in an airport finishing up the book, reading it and sitting waiting for a flight and I thought, “This is pretty interesting. You know I think, I think I get it.” And really at that moment in time Eric, I actually felt like, I understood the concept really well.
And so, sometimes today I’ll see clients and I’ll give the book to and they’ll say, “I think I understand that.”, and I’m like, “No. I’m pretty sure I know where you are, because I was there at one time. You’re about 80% there.” And I read it a second time. And that second time through Eric, it really cleared up for me. It really cleared up and it started connecting some of the pieces that I missed the first time through. I just hadn’t realized the first time through, that I was missing certain things. But once I understood that I had to really look at this conceptually, I will admit, with my background it was a little hard because, you know, I’m used to numbers.
I’m used to … I’m used to being able to see a clear path and understand that two plus two equals four and being able to see how that plays out. So when you start talking about concepts and things you can’t really chart out that way but you have to conceptually understand how you get to that point, that’s that 20% part that I wasn’t getting. So when I looked back and reread it again, it helped. You know, I also say this again Eric, we had, and my wife and myself had our first infinite banking policy and utilized it. And we had that for probably a year before I would say that I understood every element of it.
Eric Kouvolo: Yeah. It actually took me a lot longer, as well. I think … I read it. I started my first policy. I didn’t completely understand it, and then I started my second one and then a lot of the “Ahas” started kicking off. I mean it is the same time for me as “Rich Dad, Poor Dad”, where it’s about a change in your mental thought process, of understanding the four quadrants according to Kiyosaki, but now take Nelson Nash’s strategy and applying it to something you think is boring and using that concept to make it something infinite, and that’s why it’s called infinite banking.
Frank Riedel: Absolutely. You just hit it right on the head.
Eric Kouvolo: Why don’t you think people haven’t heard about this infinite banking concept? I mean, is it a conspiracy or why … What do you think?
Frank Riedel: Well, I have a few different opinions. I’ll try to keep this to something short and maybe going in one direction, but I have a couple of different opinions, and I think it really stems around industry-related education. Let’s start with that. Most advisors when you’re working in my field, in estate planning or you’re working in insurance, or you’re working in financial planning, and all these fields sort of overlap, what you end up finding out is that there are a lot of product sellers out there Eric. I don’t know. Have you personally experienced that yourself, with a lot of people in the industry being product sellers?
Eric Kouvolo: Oh yeah. I mean, I find that when you talk to a financial advisor and they say, “Well, we have fund for that and we have a fund for that.”, and they’re all in-house and what I’m finding is, you know what, it doesn’t matter if you’re in the foreign market fund, they’re going to get a commission, or they’re going to charge a fee that goes to their company. So they have no incentive to show you something outside of their house.
Frank Riedel: That’s right. And that’s what I’ve found in every industry that’s related to what we do. And it’s very fascinating because, as I mentioned earlier, I ran into a lot of insurance type of people who were just simply trying to look at this as a way to market insurance and say, “Well you know traditionally …” Whole life insurance, for instance, its hard to sell but if I package it as infinite banking I’ve got a much better chance of selling that difficult, boring whole life policy. And but then I found people in financial services that were very much product centered.
And so I think the answer to your question, the shorter answer to this would be, it’s a lack of education of how it works, number one. It is a highly competitive financial landscape out there in this world of financial planning, estate planning, insurance and other things. And so what ends up happening is, people sort of revert back to what they do. And most of these advisors are people you run into, so called experts, are people that work for a company like you just said.
And they sell in-house products and in-house services that they earn a commission on they… You know at, I’m not begrudging anyone from trying to earn a living, but if you’re going to talk about something, that’s a strategic, holistic type of approach, you really have to be able to offer that approach and not use that as teaser and then turn around sell them something else. But I think you find a lot, Eric. You know one of the things that we did … You know I mentioned I had been doing this for a number of years. When I founded my company and we were doing estate planning and working with people in the industry, we wanted to incorporate the infinite banking piece because it’s been a life-changer for us. It’s been something that, for me personally, it’s changed my financial landscape personally from this point going forward.
It’s been phenomenal what we’ve ended up doing it. Infinite banking’s help pay off my mortgage. It’s helped me do a lot of things internally, in our internal finances that’s just, you know given us a higher different direction. Redirecting dollars that we used to spend, you know, in mortgage payments and other things back into this system of finance for ourselves. So I went out and made sure that our company was an authorized practitioner. So, I went to the Infinite Banking Institute, went through the training and education, which was a lot more extensive that I probably thought it was going in. But we got the certification and you know Eric …
When you think about it. You asked me such a great question when you said, “Why haven’t so many people heard about this?” When you think about it, if you think about all the advisors, financial advisors, estate planners. Excuse me. Estate planners, insurance people in North America, and even parts of Canada, you’ll find there’s probably over a million. I mean, there are a lot of them. About less than one tenth of one percent are actually authorized practitioners, which means they haven’t they haven’t taken the time to go through the education. They haven’t taken time to be certified to the point to where an institute has said, this person understands infinite banking well enough to know, not only well enough to know how to talk about it, so its not about the marketing.
But they know how to design it, so the client can get something that they actually wanted in the first place, and be able to use it as they go forward. So it’s been an interesting road but it’s probably a long answer. But it’s my answer of why people haven’t heard it, because when you do hear it the first time you think, wow, it sounds to be good to be true and how come I haven’t heard about this, there’s many, many reasons. It starts with a lack of education out there.
Eric Kouvolo: Yeah, I agree. I mean I went through a flurry of reading, and that’s essentially how I stumbled upon “Becoming Your Own Banker”. There was something about, I believe the term was a burning desire, which I believe all started with Napoleon, Napoleon Hill “Think And Grow Rich”, and this burning desire kept popping up in all these books I was reading. And when I discovered and I fully understood, which I’m still learning every time I read and hear about infinite banking and I started off as a client, became fascinated with the concept, realized how powerful it was, to the point where I decided I wanted to become an authorized agent, and I’m working my way through the practitioner program, getting signed up for that.
But basically. There’s a lot of people, like you’re saying, that are selling a product and they’re looking for a commission, but I think there’s the purists and the people who design these polices properly to really make a true impact in people’s lives. I mean when people ask me, “What is infinite banking?” Well I can go down multiple rabbit holes and say, talk about the fed and talk about inflation, talk about fractional reserve banking. There’s so many things, but basically I feel like it’s my contribution to help people and to help society and to help the economy. And these are some of the topics we’re going to talk about going on in this show.
There’s a lot of aspects to infinite banking. We’re going to kind of tell you about how it works, maybe how it works for your different life stages and along this entire journey, we definitely want to answer your questions.
Frank Riedel: But I’d like to add one other …I’d like to add one other thing Eric, if we have a minute. And going back to this last portion of what we were talking about, you know you talk about the number of companies out there. There are really … There are certain recognition factors and things that you have to have in a properly designed infinite banking structure in order for that policy to work for the banking purposes. And in all my years of experience I have absolutely worked with so many people.
I mean, I have clients from all over the country, from coast to coast. And in working with people in over, more than a decade and doing this particular strategy, what I’ve found is, I’ve only run up on five carriers. Out of all the carriers out there, about five carriers that have the type of policies on their books that would even work for this. So, you know that old saying about the needle in the haystack, you picture a haystack with a needle in it, now you kind of understand why people haven’t heard of it because it’s like the needle in the haystack.
You’re talking about maybe five companies. There could be one or two more, but you certainly don’t have a lot of them out there who do this. And then, if you take those, let’s say those five companies and you look at all the different products and services that they offer internally, there’s usually only one product, sometimes two, on their shelf that will actually work, if you design it right for one of these types of policies. So the haystack gets bigger at that point.
So I always tell people, there’s few things you need. You need the right company with the right type of recognition factor to be able to design this policy right. You need the right type of policy. It can’t just be any type of policy that, that company offers and it has to be designed right. You also need an agent who’s an authorized practitioner, who understands not just how to design it and walk you through the steps of getting the policy. But that person has to be there and be your point person as you go forward Eric, because it’s so important, and I tell people all the time. And the haystack is getting big at this point, is that you’ve really got to have all those pieces in place because that last piece is critical because having that person that they can call you down the road.
Or you can call that person and ask them, “How do I best utilize this policy to my advantage because I have a life-stage change in my finances and I need to access money from that policy or I need to utilize that policy for growth and do something else with the money. How do I do that and have it work to my advantage?” Well that’s where the authorized practitioner come in so again, you have to have the right kind of company, the right kind of policy, the right design, the right agent to help you. And those things are hard to find, you know, that right combination. So that’s really where I would wind up on this and just say that’s probably another major reason why people haven’t heard about the concept.
Eric Kouvolo: Yeah, I definitely agree Frank and I can definitely appreciate all your help. And this fits in with what I’m trying to do and I think I actually discovered you from a Google search, where I went online and said, “Okay. How can I combine the infinite banking concept with real estate investment?” Again, going back to that “Rich Dad, Poor Dad” and alternative thinking. And it’s like let’s get creative and what can we do. Not that may not be where some people are.
Some people are, have debt and they want to pay that off and we’re going to talk about things like opportunity costs and some of the mistakes that’s I’ve made, and my story and my motivation to share this concept with everyone, is the fact that I went back and I crunched my numbers and realized, had I been using this concept instead of what Dave and Susie told me what to do, I would have, a guaranteed one million dollars at retirement, which I no longer have. Which is my mission now to help educate other people and if anyone has questions or comments along the way, just call the number on the screen or go to one of our websites and we’d be happy to answer those questions going forward as we continue this series.
Frank Riedel: It was great talking with you today, Eric. I always love talking about infinite banking. Thank you for the time.
Eric Kouvolo: My pleasure, Frank. I appreciate all your expertise. I want to thank everyone for tuning in and we look forward to next week as we dive deeper into the infinite banking concept and other financial strategies. Have a great week everyone.