The Pros and Cons of Being Your Own Banker

Have you ever considered how you could manage your finances better rather than putting them in the hands of banks and other financial institutions? Many people want to be financially independent, so the idea of being your own banker is appealing. Today, we’ll talk about the pros and cons of becoming your own banker and help you decide if this is a good idea for you.

What is Becoming Your Own Banker?

Becoming your own banker is based on the Infinite Banking System, a way to save and invest money that uses whole life insurance policies. As an alternative to traditional financial institutions like banks, the idea is to establish a self-sufficient and tax-free system, allowing you to borrow money from yourself.

So, what are the pros and cons of using this strategy? Let’s get started and find out.

Pros of Being Your Own Banker

1. Financial Control

Being your own banker has some benefits, including the power you gain over your future finances. Your financial future is in your hands instead of those of banks and other institutions. So, rather than considering the interests of a third party, you can make decisions that are in your best interests.

2. Tax-Free Growth

You can benefit from tax-free growth on your money by using a whole life insurance policy as your main method of saving and investing. This can be a significant advantage compared to conventional savings and investment accounts, which frequently incur taxes.

3. Access to Liquid Funds

You can easily get to your money whenever you need it when you become your own banker. This is because you can get cash value from the whole term life insurance policy at any moment without needing to apply for an advance loan or pass a credit assessment. This is especially useful in times of financial crisis or when opportunities arise that necessitate immediate funding.

4. Amenable Loan Terms

Setting your own loan terms when borrowing from your policy is another advantage of acting as your own banker. This entails that you are free to choose your own repayment plan and interest rate without being constrained by the strict rules of conventional lenders.

Cons of Being Your Own Banker

1. Initial Costs

The initial cost of setting up a whole life insurance policy is one of the main disadvantages of becoming your own banker. These insurance plans can be expensive, especially compared to term life insurance, and they might only be suitable for some people.

2. Limited Investment Options

Self-financing your investments can be advantageous, but remember that your whole life insurance policy growth is all you have to work with. Compared to other investment strategies, this one might offer more diversification or higher potential returns.

3. Complexity

Becoming your own banker can be complicated, and it may be best suited to those with a strong understanding of financial planning and management. Before deciding to implement this strategy, it is crucial to conduct extensive research and understand the concept.

4. Discipline Required

Being your own banker requires a certain amount of self-control and discipline in handling the finances. Some people might find this difficult, so it’s important to carefully consider whether you have the abilities and temperament necessary to carry out this strategy successfully.

Are You a Good Candidate to Become Your Own Banker?

While there are obvious advantages to being your own banker, it’s crucial to balance these against any potential disadvantages before making a choice. For some people, the strategy’s initial costs and complexity may be outweighed by the control and tax advantages. Some people may benefit more from a traditional approach to financial management.

We suggest reading the books of “Mary Jo Irmen” and other professionals in the field if you’re interested in finding out more about starting your own bank. You can choose the best for your financial future with the right information and direction.


Being your own banker is ultimately a personal choice that depends on your specific financial goals, circumstances, and preferences. You can make a decision that will help you reach your financial goals by carefully weighing the advantages and disadvantages.