How to Size Your First IBC Policy (Without Starting Too Big or Too Small)

David BefortJune 5, 20262 min read

IBCpolicy designgetting startedinfinite bankingwhole life insurance

One of the most practical IBC questions doesn't get enough airtime: how big should your policy actually be?

Start too small and the cash value never becomes meaningful enough to function as a real banking system. Start too big and you can't sustain the premiums — and a lapsed policy is worse than no policy.

Think Capitalization, Not Expense

Don't think about the premium as a bill. Think of it as capitalizing your personal banking system.

A business owner who starts a company puts capital in before that capital generates revenue. You're doing the same — putting capital into the policy before the cash value is large enough to deploy meaningfully. The premium is infrastructure investment.

Given that frame, the question becomes: how much can you consistently capitalize this system, without financial strain, for the next 10-20 years? That number — sustainable, consistent, unconditional — is your premium.

The Too-Big Mistake

Some people, excited about IBC, design a policy at a premium they can afford in a great year but not in a difficult one.

When income dips, the premium becomes a strain. They take reduced paid-up status or surrender the policy. Early-year cash value is still below total premiums paid. They've lost money and their belief in the strategy.

Better approach: start at a premium you can absolutely sustain in a down year. You can always add extra PUAs in good years. The base commitment needs to be unshakeable.

The Too-Small Mistake

The opposite problem: a premium so small that after 5 years, the cash value isn't large enough to borrow against productively.

Match the policy size to your actual financial life. For a business owner doing real volume, the policy needs to be large enough that the cash value eventually becomes a six-figure borrowing pool — not a footnote.