R. Nelson Nash is the originator of the Infinite Banking Concept. His ideas are based on Austrian economic theories with a specific emphasis on using dividend-paying, whole life insurance to create your own family bank. In this way, you eliminate the need for banks and bank debt and put the financing process to work in your favor.
Biography and Discovery of Infinite Banking
Robert Nelson Nash was born in Green County, GA on March 15, 1931.
In his earlier life, he spent two years in the Air Force. He then received a BA in Forestry in 1952 and spent almost a decade in the industry.
After getting the idea of the Infinite Banking Concept, he spent years of his life toying with the concept.
A major heart surgery became the spiritual motivation. He knew he needed to get the concept out to people everywhere.
There was just one problem. He didn’t know how to clearly and simply explain the concept.
To get the idea out to the world, Nash spoke at local seminars.
Sometimes he would speak to a few people or a few dozen people. But often, the room was empty.
When he would get an audience, he struggled to communicate the complex concepts in a way that was easy to understand.
Much of his time was spent pondering the concepts he sought to convey and how to best communicate them.
During this time, he wrote down and organized the ideas into what later became his book, “Becoming Your Own Banker: Unlock the Infinite Banking Concept.”
The book grew in popularity. More and more people, from blue-collar workers to Ph.D. economists, were drawn to the Infinite Banking strategy proposed by Nelson Nash.
Because of its broad appeal, the concept continued to gain momentum, growing into what it is today.
R. Nelson Nash died on March 27, 2019, at the age of 88.
Financial Lessons from R. Nelson Nash
Nelson Nash broke financial barriers by showing people they were using life insurance all wrong. They were looking at life insurance backward. Instead, he suggested the goal of life insurance should never be about insurance–a description he thought was more hurtful than helpful.
But Nash was more than that. He was a great educator.
Here are a few foundational lessons taught by Nelson Nash.
Expenses Rise to Income
Also called Parkinson’s Law, one lesson from Nelson Nash is that, fundamentally, all “expenses rise to equal income.”
“A luxury, once enjoyed, becomes a necessity.”
The natural draw in your life is not to save money but to spend it—every last dime.
Every individual tends to increase consumption to the level of earnings.
You must check this tendency daily. If not, you become a slave to the system and are destined to be broke.
Taxes Are Theft
Nash referred to this as Willie Sutton’s law.
Sutton, a bank robber, was asked why he robbed banks.
He replied, “That’s where they keep the money.”
Willie Sutton’s law is this: Wherever there is money, someone will be there to try and steal it.
And today, the biggest thief is the IRS. They take more money in your lifetime than anyone else.
To avoid losing money, you must do everything you can to legally avoid paying taxes. One of the reasons Infinite Banking uses whole life insurance is because of the tax advantages.
The Illusion of Knowledge
“The greatest obstacle to discovering the earth was not ignorance–it was the illusion of knowledge.”
Set belief systems can get in the way of learning. It is near impossible to open someone else’s mind if they aren’t willing.
This trap is easy to see in others but difficult to see in ourselves.
The world around you is filled with “ruts”–or easy ways to follow the status quo. Life makes it easy for you to make bad decisions easily justified.
You must be open and willing to consider new ideas and not reject them simply because you think you know better.
Be open to new ideas and beware of the illusion of knowledge.
A Government-Sponsored Problem
The government often creates solutions to problems they created. Government-sponsored programs like 401ks and IRAs are part of this “solution.”
“Socialism does not work,” Nash said.
And these government-sponsored programs are merely socialism in disguise.
Government-sponsored programs drive people to put more money in the government’s control.
Moreover, retirement is simply another government “solution” to push older workers out of the workforce.
All these ideas, along with social security and other government “benefits,” move together like an unstoppable tsunami that only brings financial destruction.
R. Nelson Nash–A Great Financial Leader
I talked at length with Nelson Nash before he died. He taught me many great lessons. He helped me become the person I am today and helped shape the safe financial strategies that are the foundation of Wise Money Tools.
For me, Nelson Nash was a long-term-oriented free thinker who saw whole life insurance not as a scam but as an effective and efficient wealth-building tool.
After the 2001 financial crash, he helped me see why protecting money, getting out of government programs, and saving money on taxes are powerful ideas.
We put our twists on IBC, but the core of what Nelson Nash taught is still very much alive in what we do.
And for that, I will forever be in his debt.
