Finding the right infinite banking advisor can be tough. A lot of people claim expertise, yet a few smart questions can help you determine if they are right for you before you hire them to help implement the Infinite Banking Concept (IBC) effectively,
An experienced and knowledgeable IBC advisor can be the linchpin in helping you build and manage a successful infinite banking strategy. To ensure you make an informed choice, we have provided 10 critical questions to ask.
Additionally, we have also added five extra questions that may also provide useful insights into an IBC advisor’s expertise. Here at Living Wealth, we are well-practiced at providing answers to these questions to our IBC clients. Contact us if you’d like a consultation.
1. What Is Your Experience with Infinite Banking?
Begin by assessing the advisor’s experience with IBC. Inquire about their background, including how long they have been working with IBC, the number of clients they have assisted, and their track record of helping clients achieve their financial goals using this concept. Experience matters significantly in navigating the nuances of IBC effectively.
A seasoned advisor likely has encountered a variety of financial scenarios and can offer valuable insights based on real-world experiences. They should be able to share examples of clients they have assisted in implementing IBC successfully.
2. Are You Familiar with Whole Life Insurance?
IBC primarily revolves around whole life insurance policies. It’s essential to ensure your advisor has in-depth knowledge of this specific type of insurance. Ask them about their familiarity with whole life insurance, their understanding of its features, and how it aligns with IBC principles.
A proficient IBC advisor should be able to explain how whole life insurance policies work, including the mechanism of building cash value, dividends, and the benefits of this type of insurance for IBC.
3. Can You Provide References or Case Studies?
One of the best ways to assess the capabilities of an advisor is to ask for references from past clients or inquire about specific case studies that showcase their success stories with IBC. This will provide you with a real-world perspective on how they have helped clients achieve their financial goals using the Infinite Banking Concept.
When contacting references, consider asking about the advisor’s communication style, level of responsiveness, and their ability to customize IBC strategies to meet individual client needs.
4. How Do You Customize IBC Strategies?
Recognize that every individual’s financial situation is unique. To harness the full potential of IBC, it’s crucial to have an advisor who can tailor strategies to align with your specific financial goals and needs.
Ask the advisor about their approach to customization. Do they conduct a thorough financial assessment to understand your goals and risk tolerance? How do they adjust IBC strategies based on changing circumstances?
5. What Companies and Policies Do You Recommend?
While IBC can be implemented with different insurance companies and policy types, the choices made can significantly impact your strategy’s success. Inquire about the advisor’s recommendations and the reasons behind selecting specific options.
A knowledgeable advisor should be able to provide a rationale for their recommendations, considering factors like the financial strength of the insurance company, policy dividends, and the flexibility of the policy.
6. How Do You Handle Policy Funding and Premiums?
Understanding the mechanics of funding and premiums is fundamental to managing an IBC strategy. Ask the advisor to explain how they approach premium payments, what funding strategies they recommend, and how these strategies align with your financial goals.
A competent advisor should be able to guide you in optimizing your premium payments to maximize cash value growth while maintaining policy performance.
7. What Are the Fees and Charges Involved?
To make an informed decision, it’s crucial to be transparent about the costs associated with both the advisor’s services and the policies they recommend. Different insurance products may have varying fee structures, and advisors may charge fees for their guidance.
Request a breakdown of all fees and charges, including advisor fees, policy fees, and any other associated costs. Understanding these costs upfront will help you assess the overall affordability of the IBC strategy.
8. How Do You Address Tax Implications?
Tax considerations are a critical aspect of any financial strategy, including IBC. Inquire about how the advisor addresses tax implications within the IBC strategy. This includes understanding potential tax advantages and implications when borrowing from your policy or receiving policy dividends.
An adept advisor should be well-versed in the tax implications of IBC and provide guidance on how to optimize your strategy to minimize tax liabilities.
9. Can You Explain the Risk Factors?
Like any financial strategy, IBC carries inherent risks. Ask the advisor to outline potential risks associated with IBC and how they mitigate these risks within your strategy. Understanding the risks will help you make informed decisions about the level of risk you are comfortable with.
A responsible advisor should be candid about potential downsides and have strategies in place to minimize these risks.
10. What Ongoing Support Do You Offer?
The journey with IBC doesn’t end once your strategy is in place. It’s essential to inquire about the level of ongoing support and monitoring the advisor provides. This includes regular reviews of your strategy to ensure it continues to align with your financial goals.
Ask about their availability for questions or concerns and whether they offer educational resources to help you stay informed about the progress of your IBC strategy.
5 More Questions to Ask an Infinite Banking Advisor
Here are five more questions you can add onto your list when interviewing an infinite banking advsior.
11. Can You Provide a Financial Projection?
Request a financial projection or illustration that demonstrates how an IBC strategy is expected to perform over time. This can give you a clearer picture of the potential outcomes and growth of your policy.
12. How Do You Handle Policy Loans?
Policy loans are a fundamental aspect of IBC. Inquire about the advisor’s approach to policy loans, including interest rates, repayment strategies, and how they ensure that policy loans don’t jeopardize your strategy’s performance.
13. Are You Familiar with State-Specific Regulations?
Different states may have varying regulations related to insurance and financial products. Ensure that your advisor is familiar with the regulations specific to your state and can tailor your IBC strategy accordingly.
14. Some Infinite Banking Advisor Use Too Much jargon. Can You Explain the Concept in Simple Terms?
Complex financial jargon can be intimidating. Ask the advisor if they can explain IBC concepts in simple, easy-to-understand language. This will help you grasp the intricacies of your strategy more effectively.
15. How Do You Keep Abreast of Industry Changes?
The financial industry is constantly evolving. Inquire about the advisor’s commitment to staying informed about the latest developments in IBC, tax laws, and insurance products. This ensures that your strategy remains up-to-date and aligned with current best practices
