E35: Ray Poteet Shares The Surprising Infinite Banking History

Nate: In this episode, we have special guest Ray Poteet back with us so that we can learn a bit from his history with IBC. Ray’s going to be sharing today exactly what he has done over the past 17 years with Infinite Banking and the wealth that’s really been created by following the principles taught through the Infinite Banking concepts. We’re really happy to see that. She’s Holly and she helps people find financial freedom.

Holly: He’s Nate, he makes sense out of money. This is Dollars and Nonsense, if you follow the herd you will be slaughtered.

Nate: Hi Ray, welcome back again for two episodes in a row and this time for all those out here who have no idea, we ask where did IBC come from, how did we hear about it? Well, to be honest I don’t think there’s anyone out there that has a better testimony than you do of what it’s done. Very few people have done it for longer than you, just in reality that are out here sharing with people. Very many people have actually taken in to the level that you’ve taken it, done the things you’ve done, really looking forward to the episode. And hearing from you what’s happened in the past 17 years of IBC almost. So that’s what we’re going to be doing today. So, Ray tell us a bit about what you started, where you were at before you even learned about Infinite Banking and tell us about how you learned about to begin with.

Ray: July the 16th, 2001 I was managing money. I was doing quite well but I was also selling insurance. Pre- tax insurance, retirement programs, various things like that. The government literally put me out of business from the insurance side with one stroke of the pen saying they were not going to allow the type of programs that I was currently doing anymore. They were going to change the guidelines on it. And I didn’t know what I was going to do be quite honest with you. I’ve been into retirement, I’ve been into LEAPs, I’ve been into BIBAs and now it was another time period at age 54, what are you going to do with your life.

And this book come floating across my desk called How to Become Your Own Banker by R. Nelson Nash, I read it because I didn’t have nothing else to do right then. I was trying to figure out what I was going to do, and as I read the book I became very, very upset. Not upset with the book but upset with my industry, the life insurance industry, why it had not shared with me what he was sharing with me. So, I called him and I said, “Is this true?” And he said, “Yeah.” And I said, “Why haven’t I ever heard about it?” He answered my questions and I said, “Do you teach on this or what’s going on besides the book.” He said, “Yeah.” I said, “When’s your next teaching?” Said, “I’m going to be in Overland Park, Kansas tomorrow night.” I said, “How did I come? Overland Park’s only 30 miles from where I live.” He told me …

I saw him for the first time I said, “Is it longer? Do you do more?” He said, “Well, we got a whole 10 hours.” I said, “When are you doing again?” He said, “Tuesday in Fresno, California.” I said, “How do I come?” I saw him that Tuesday, he went Tuesday, Wednesday. I said, “When are doing again? He’s doing it Friday. So, I flew to Murfreesboro, Tennessee so I’m good again. Said, “When are you doing it again?” He said, “Next Tuesday.” I flew to there. I said, “When you’re doing it again?” And so, literally I saw Nelson’s presentation five times in the first 10 days. And I’m realizing it spoke to my spirit, spoke to my heart.

There wasn’t any fancy movement, various things to learn, this and this, it was talking about a product in an industry that I’d been in 31 years at the top of the game. I mean, top of the game. Because there’s an organization called Million Dollar Round Table, which I’ve been in since 1973 and there’s a Top of the Table, which is the top of 3% of those in MBRT that I’ve qualified for since 1981. So, it wasn’t it I didn’t know about the industry or something, but nobody had told me this. So I felt totally betrayed by the industry.

I had considerable premium at that time but I had it because my Jewish uncle had taught me to make sure I take the proper dosage of medication to stay equal to it. So, I was putting a lot of money into life insurance at that point, what I considered a lot of money I guess you might say. I considered it a lot of money. Many people today aren’t even close to what I was putting in. That’s not to say that’s good or bad I’m just saying, to me it was a way that forced me to save money and that’s one of the rules in first Timothy 2:6 that says, “The hard-working farmer should be the first partaker of the crop.” God says if you’ll do this, he’ll do this. Doesn’t say you have to love him, he gives you rules and there are rules about money I didn’t know about but I was practicing a couple of them. And so that’s what occurred and I started having a passion and a love affair with this thing called IBC.

Nate: Still having the affair today.

Ray: My wife knows that, we agree upon it but it’s something when you know the truth, it’s like when I came the lordship of Jesus Christ, I want to tell everybody about it. When I came to the understanding with IBC, I’m very well known in our industry, I would try to tell a lot of agents. I did tell a lot of agents, trained a lot of agents, trained a lot of people. But very few will just endorse it and haven’t become their way of life as we have as a family in a unit. And so that occurred the most amazing thing to me, I had asked my oldest daughter if she wanted the business that I was in, this was before I learned about IBC. She said yes and I said okay I’ll train you starting and because she had a baby, I said, “It’ll be 18 years and 18 years from now, I’ll give you the business because she wanted it because of the income on it.

Then Holly sort of ambushed me after we had thought about it, nobody was in it and she was coming home from the Olympics in 2004 and said, “What about hiring all three of us?” And I’m going, “Wow, okay.” I think there was a fear in my heart knowing … I don’t think I know there was, will this support all four of us. I sort of gave it up to God and we started the process to get her husband a permanent visa in the U.S., took about 30 months longer than we thought it would and she stayed in the UK awhile and as I started training my two oldest daughters. And they say today that it was hell working with me and I believe that because it’s really strange to work with a group of people when you’ve been by yourself the whole time and doing it. And to share things and you don’t know how to do things.

I’m thankful they’re much like their mother, they had staying power, I would have probably quit and went did something else. None of them did, they should have. But they’ve learned the business so well and due to that, even you know as well as I do I even argued with God about you coming to work here. And the Holy Spirit, I’ve never wanted to fight with the Holy Spirit and I look back now and I am thankful that the Holy Spirit spoke to me about my daughter’s, about you, about what’s going on and I said yes even though I was uncomfortable. Because now what was then, which I thought was pretty great, I found was very small compared to how big God wants to make a family and how powerful a family unit is.

I wasn’t thinking family, I was thinking the individual even when I first came. But I started thinking about my own brother and sister and especially my brother how many cars he goes through and various things. I thought about all the money our family had lost when we didn’t need to because I owned a product that they’re using in the process but not once had I used it until I read Nelson’s book.

Nate: Yeah, so as you said, you had a lot of policies, big premiums but no one taught you how to use the product so it was just sitting there.

Ray: Right.

Nate: And that’s when you found Nelson, learned it, that’s really where the story started, which was what did Ray do once he learned Infinite Banking and what changes did you make.

Holly: Are you tired of being stressed about money. The Dollars and Nonsense Podcast is sponsored by Living Wealth. Visit livingwealth.com/freedom to get your free smart money ebook and sign up for a personal wealth presentation today. Living Wealth is a family owned and operated business, which works with individuals, families and even businesses to slay the money stress dragon. Our clients receive individual coaching regarding wealth creation and how to create a retirement income. You’ll be enabled to have cash today and in the future. Since 1972, Living Wealth has been committed to educating smart people on basic money principles to assist them in becoming debt-free and finally find financial freedom. Let us help set you free. Remember to visit livingwealth.com/freedom to receive your free ebook and even sign up for an individual wealth presentation today.

Nate: Tell us what happened.

Ray: Well, I learned that you could get all your money back on a car. At the time I was glad I learned that but I was pissed off that nobody had told me sooner. Is there [crosstalk 00:10:20] truth about it and I actually went back to my insurance carriers and became sort of a nuisance as I asked what would have happened here. I got these numbers and spreadsheets and various things and I found out from 1977 to 2001, that’s a 25 year period, I had purchased 26 cars. Now, I didn’t say 26 new cars and when you have five primary drivers in the family, it’s not anything to have one car year. Okay. But if I had the ability to use my policies on all of those cars and if I had, I would have had $323,000 that I didn’t have. That upset me.

Nate: 26 cars if you would have financed through the policy, and 323 more than what you had at that [crosstalk 00:11:16] 323.

Ray: Not only that, then I just did a calculation based upon lifetime, that was about 4 million dollars that my family was cheated out of. Now, what I’m saying, people need to understand. Somebody had the money. It wasn’t like, if I start doing this, I now get the money, somebody has that money and literally the picture God gave me was I’m going to go into somebody else’s cash register and take the money out they took from me and bring it back to our family. That’s literally, it was my money, I had spent it, now I could keep it and he started showing me how to keep this. Not only from age 54 onward but that my children who are in their 30s could keep it if they just kept it to my age 54 and their children could keep it until they were 54.

But on past that which we’ve done that the family unit is so much stronger and wiser and able to do things for God’s work, for the things that they love and they have a passion for. And when they go to the car lot, they don’t have to look at the car they think they can afford, that can actually purchase the car they want feeling okay about it. Not because they’re wealthy but just because they know they’ll get every penny back, principal plus interest by following these simple rules that IBC taught me that we’re trying to teach to others. And that was fun, it was no different than learning about the Lord Jesus Christ and sitting under somebody that had walked with the Lord for years, man we could do that. And we got the same results that they were getting, disciples and various things and excited about what was happening with the lordship of knowing what Jesus wanted to do for us, I wanted to do for others in the area of finances and money.

It was a natural fit and being challenged by individuals, well, could I do that? And I’d say no and then we think about it, yeah you can. Think of all the things you could do, I didn’t think it. About vacations, but then all of a sudden I thought, “Well this would work for a vacation. This would work for an addition to the house, this would work for new furniture. If I had known this.” I mean I spent a fortune when my girls went to university. And I didn’t know about banking and it was costing me in the early ’90s about $80,000 a year and that was a struggle. I mean that was a struggle. They didn’t have to borrow any money, dad didn’t have to borrow any money but boy he was scraping bottom. To make sure they could do the things they were doing.

I realized that just with this knowledge, if I know what I went through, if I could keep one family, one parent, two families from going through the emotional swings that I went through, it all be worth it. I just wanted people to know we can do this on little money, big money, various sizes of money and I had a great referral in 2003 that really showed me he had borrowed a huge amount of money from Wells Fargo way in the eight figures, not seven and he was paying them that much in interest and he says he’s going to get it all back. Well, he had my attention real quick.

He understood it better than I did and my attitude was, well if it’s good enough for him, it’s good enough for me. So, I started learning and learning and being challenged and learning and challenged. And so I kept buying more policies and loaned the money to my daughters for their houses, that was amazing to me. To be able to do that, to walk in to countrywide and just buy out a mortgage, which we did. And to watch the results of that, which is to this day very amazing. I’m getting two and a half dollars for every dollar she pays me on that mortgage and we have all the money available now and she’s built a new house and we’ll use it again, and use it over.

I just can’t imagine that if somebody knew this and didn’t tell me how they could look at me. And yet in our industry, even today, they’re not teaching this at any of the major meetings. There is nothing at those meetings for me. And they’re wondering why I don’t attend. Because I’m really focused. I want nothing to take me away from what we’re learning, what we’re trying to teach, I can tell you one of the great blessings during this time period was actually learning from you, and the strategic business loan and how powerful that is. And I can remember sitting right where we are today when you came in said to me, “What if we could make the bank the depositor in our own banks?” I’m going, “Can’t happen.” And you brought me in it and it can happen and we’re doing it.

So, the learning and the greatness and the gifts that are being put into people and how they’re challenging us and if we listen to what they say, wow. Jesus is just here saying, “There’s another one, go over there, go there. Keep your eyes open. Don’t close them. You know what’s going on.” And it’s made me I think a better listener, it’s made me wiser in the sense that don’t put any idea down especially about money, listen to it, see if it works and it’s also shown me how crazy some people are with my money. If they could use my money. They ain’t got no money but they want to use my money. That’s something that we’ve turned the faucet off.

Nate: Yeah, and is being controlled by yourself.

Ray: Right.

Nate: You said you increased premiums and if we go back 16 years, you would never have ever thought that you’ve been putting in as much into the system as you are today.

Ray: Yeah, I’m putting in now about 1/12 of what I was putting in. So I’ve increased at almost 12 fold.

Nate: 12 fold based on where you were. And what was the big aha moment or something that … When did you get comfortable enough to do what you’re doing? Because we got a lot of the people who listen and who are like, I can see were Infinite Banking can go, treating it like a real bank, putting a lot of money into it and taking a lot of money out of it. And you’re doing it in the kind of the poster boy for that concept. What went through your mind when you were doing that and what made you actually comfortable and understanding to do it? Because I know at the beginning, you would not have wanted to do that so it kind of changed I think the mentality-

Ray: Yeah, it took about eight years in the system, nine. I would say it really caught it in 2008-2009 somewhere in there and all of a sudden I really saw it as a checkbook. I saw well, what’s a checkbook? All it is money and money out, money and money out. All you’re doing is using it to move money. I said, “Well, what if you could put money in and take more out, how many times would you want to do that?” And I said, “I don’t know there’s a limit to it.” A lot of it had to do with well, how do we get more in than we have, how can we use this or how we can do it and that came into what we call laddering and various things and going through a couple of panic stages.

I can tell you June and July are big months premium-wise for me. And I didn’t think about it, I just did it. Sort of all of a sudden, the premiums weren’t that big and I could afford it and I probably did a couple of stupid things, today I think they’re brilliant, but at the time I thought they were stupid. I paid a premium and didn’t think about where’s the money coming from next year. About 2014-2015, I remember, just had a huge premium come due in June. And I’m going, “Well, I don’t have that kind of money this June.” I think I just paid taxes or something, I don’t remember what it was and I’m going, “Where am I going to get this money?”

I remember asking Lisa at that time because she’s been with me so long, “What’s the cash value increases on these policies that I need to pay?” When she told me and it was over $70,000 more than I was going to pay, I found the money. It’s not very hard to find money when you’re going to get more. I mean, you can find it. If you knew you’re going to put in 5,000 or 6,000 you’re going to have 10,000 and you don’t find the money, I would tell you get to the psychiatric ward at closest hospital around. Because you can find money. You just seem to find it somewhere.

Now knowing that it’s okay to move money … See I still go through a phase. I don’t today but I was at that time to store money. I was storing it more than I was really moving it. Now I hate to store it. I don’t really look at what we have in storage until Lisa or Kim or Lloyd joke, somebody tells me, “You ain’t got that much money.” And then I get a little panicky and I go where’s all the money and I’ll go look at policies or something and we’ll find it. Now, Joyce every other month or every third month will actually tool up by calling the insurance companies on my little over a hundred policies now. She’ll call on each one of them find out what the current cash value is and when I see that as a whole, all the panic goes away and I’m saying, well I can make another month or another year or another two years and I’ll be okay.

Then I [inaudible 00:20:48] to really started thinking about just monthly how to recapture everything. Whether it be utilities or groceries or eating now and one thing I’ve noticed at my age is a lot of people are concerned about running out of money. I can tell you I do not have that fear today. I can remember the program my dad had in me, you’re going to have this amount of money and you got to make it last for as long as you live. And that’s the way most people are programmed to store up money and I encouraged them to store up cash flow. Create a cash flow-

Nate: How have you done that with your cash flow?

Ray: Actually, I own the mortgages on my children’s mortgages, I own your mortgage, we’ve got a number of cars. All that money’s coming in and mom and dad or grandpa and grandmother, we really go buy papa and nana, can use that money to live on if we needed to. If I wasn’t earning a living, it would be a surplus of money and I can live on that, that gets better every year because the death benefit will replace it at the time of our death. So, we’re using our death benefit today to use good dollars, powerful dollars and pay those off with the weak dollars so the family can reuse them upon our deaths. And they’re there.

Nate: When you say cash flow, you’re talking about really the lending business really that you’ve created using your policies to fund [inaudible 00:22:16] and it’s not just family members anymore, that’s how it started.

Ray: Right.

Nate: And all of the family members have something with you essentially, but it’s also branched out and you’ve lent quite a few other people money.

Ray: Yeah, we have about a 179 people other than family members I’ve loaned money to that are secured notes, there’s no signature notes. I tell people I wouldn’t borrow from me. It is amazing when you learn that you can borrow at 5%, loan it at 8% that you’re really making 60%. Go into a meeting sometime discuss that because it doesn’t sound right. But that was a great breakthrough and that the cash flow now that I have on a monthly basis, a lot of people don’t make in a year.

I’m not bragging about that and please don’t take it that way because I think there are so many families out there … We didn’t have a large family, we had three children. Now, they were all very, very fertile and they had children, and it’s made our families a larger unit than it was and it’s a larger unit now since you’ve joined the family. I can’t say let’s worry about the cost of kids because we’ve learned that we can recapture those expenses. Whether it be a child being born, whether it be a person being sick, whether it be in a car wreck and we have to replace a car, whether it’s buying a home. I’m not saying just go buy those things, the things we normally do in life anyway.

Parkinson’s Law is true. We expand as our income does. And there are certain things I don’t like to eat anymore that I used to eat all the time. There are certain places I was quite enjoyable staying in that I will not stay in anymore. That my children have helped me a great deal to grow and quit being … Not that it’s unhealthy to be a penny pincher but it really turns off the stimulation and kills your dreaming if you’re worried about money all the time. You’re not as productive or as creative if you can just think, well, let’s try this and if it doesn’t work, will I ever recover. I can tell you I’ve learned a lot from losing money. I’m a very good private banker because I lost money on loans. That’s the cost of experience.

I can tell people things today that they didn’t know. Like, how to do mortgage certifications and now tax certifications and the paperwork you need to do if you’re going to be a private banker. Those were all learned because I was foolish and I didn’t really ever have mentors that taught me about money-

Nate: Especially IBC-

Ray: Yeah.

Nate: That way, you were the pioneer almost for a lot of the people who are doing it pretty well.

Ray: I believe I am.

Nate: Because you were willing to make the mistakes.

Ray: The other thing is, Nelson taught us banking, he didn’t teach us money. Some of the things and how to push the limits to it. I mean, if families would just recover the cost of cars, they would never worry about this thing quote unquote called retirement. I don’t care whether you wear the tires out on a car and it can’t run anymore, you trade it every year, either way it works. And that’s the joy of it. You don’t have to do it a certain way. I had a very good friend of mine say, I’ll never buy a new car. I told him, “Aren’t you glad somebody did?” Because if not, he’s not going to have a second-hand car, he’s going to have a third of fourth-hand car. But even though he’s a client and I’m not telling him to buy new cars, but I’m saying, regardless of the car you buy, how would you like to get the money back and use it again. I mean, that’s just thrilling to me.

The vacations we’ve been able to do, whether it was skiing or to Hawaii or to Disneyland or wherever it was or the birthday parties we’re able to have or the gifts we’re able to give one another, not because they’re expensive but because we know they want that. And we don’t have to worry about what was the cost. I can tell you two or three times, I’ve messed up a little bit, I can tell you because Alaskan airlines, they let you fly anywhere, they fly for $99 with a companion once a year if you have one of their credit cards. I was just thinking, well, first class, I could get my bride for $99, well that’s only works in coach. I’m so stingy, I bought that ticket and my wife Parkinson’s has set in and she does not like to fly over water in coach. I’m not saying it’s wrong I’m not doing anything, we’re spoiled.

We were flying in coach to Hawaii and she said, “We’re coming home first-class, aren’t we? I said, ” Absolutely.” Within four hours after we landed, I forgot about the reservations we had and I booked first class coming home because I knew she’d be happier and I could recover the money. Now, I can tell you before, we’re going on coach and you’re going to like it and she would have been happy with coach if I’d never put her in first class. But I can remember first time we flew first class and it was from Dallas to Cabo and she leaned over and she said, “You know they treat you differently up here than they do in coach?” I said, “Yeah.”

And as we’re landing, I still remember. She said, “You know this could become addictive.” And it has. Okay. By being able to understand cash flow and recapturing and banking, it’s not because we’re big spenders or we’re trying to show off, it’s the comfort that it gives you to be able to do things. I’ve done work in China and when you get off the plane, they put you to work. And you’re happy to get on the plane to go home. I got the most rest on plane going and coming home than the eight days I was there working because they’re just so eager to do things. You go to bed late and they get you up early and you’re with them and they’re doing it, so you got to do it. I can tell you I’m not used to that anymore.

But being able to lay down coming home and sleeping most trip home or things like that or you hear a ministry. I’m just thinking about one of the ministries we work with and with my normal giving, we were able to build a grade school in that country. I’m going, “Really?” We’ve done it three years in a row and I see the results of those students and various things that I wouldn’t have comprehended without banking.

Nate: I know personally it’s freed up to be able to be more giving.

Ray: Yeah.

Nate: Just because your money’s not locked up and you’re thinking differently.

Ray: Yeah.

Nate: And it makes it way easier but … That’s great. Thanks for telling the history of it and what you’ve done and I hope that the listeners will be able to glean some things off of that and try to implement something similar personally.

Ray: I hope they just ask questions so we get the opportunity to share with them. Because, Christ came that he might give. He gave his life and that’s really what Living Wealth is all about. It’s a giving proposition. Give us an opportunity to really share with you what it’s done for us, not what we think it will do. We’re living it.

Nate: Yeah.

Ray: And that speaks, other words you don’t have to question it, it’s there.

Nate: Absolutely. Well, it looks like we’re about out of time. So, this has been Dollars and Nonsense, if you follow the herd, you will get slaughtered.

Holly: For free transcripts and resources, please visit livingwealth.com/E35