Infinite Banking/banking On Yourself

Why not just start a bank?

Something counter to all the big ones. Start very small, maybe just one branch or even internet based. Take deposits and make mortgage and small businesses loans. 

Give customers added value, by making every account a command account such as they use in Australia and parts of Europe (Virgin Finance used to offer something like this too). With these command accounts, every client gets a credit line. The credit line scales to pledge-able assets (property, stocks, life insurance (whole or term), government guarantees for student loans, …) and income. 

The bank could scale rates relative to the quality of the collateral.

Nothing unusual yet, but now it gets more interesting for the consumer.

On any given day for any outstanding borrowing against their credit line, the bank charges the lowest applicable rate. 

Example: A consumer has a: 

$500,000 credit line at n% secured by a house and 
+ $ 25,000 consumer credit at n+1% secured by their income cash flow

If on a given day (regardless of whether they paid for something with a credit card) they only have a total of $400,000 outstanding balance, they only pay the n%.

If they had a $510,000 balance they’d pay n% on $500k + n=1% on the remaining $10k

Also, any cash balance in an account gets scooped up on a daily basis to offset any outstanding balance. Over the long run this could save a VERY significant amount of money on a mortgage or loan. Any positive balance they have gets paid some interest rate.

I like this because all consumer’s money and assets work for them as much as possible and it does so automatically without them needing to move things around.

This makes a lot of their financial life seamless. One wouldn’t need to put a time on loans and mortgages. No one would ever need a second mortgage, they could just draw from their credit line as needed. Same thing for reverse mortgages. A home owner could just draw from their credit line as needed without all the other trouble.

If someone made improvements to a property they can ask to have the property value reassessed.
We could also give some thought to how to figure in rising or falling real estate values.

I believe this combination of transparency and ease, if executed properly, should draw very loyal customers.

Get them to house all their financial assets with the institution.
Add direct deposits and automatic bill payment.
If one has all their financial information one could automatically generate tax returns for them.

Almost as simple as viewing every client as having a balance sheet.

Give consumers the best break possible and I bet one could keep them for life.

Make all loans cost +
Forget about securitization

Elizabeth Warren would love this idea. A utility banking model that would generate in-sized rather than out-sized profits. Honest and transparent banking that doesn’t play 3-card Monte with the consumer.

This idea completely incorporates the infinite banking model and would make it available to everyone. It also has the advantage of making monetization of assets simple and easy for anyone.

A better bank. A better system. Someone ought to do this.

Dollar Shave Club

I’ll echo just about everything rugorak said.

I also use a DE safety razor. I got it used from a gentleman on one of the safety razor forums for about $20. I could have bought a new one for the same price, but at that price-point they’re all plastic these days. The head and handle are chromed steel and aluminum, respectively, and the whole thing is still corrosion-free after 48 years (yes, my razor is 27 years older than me! a testament to their longevity). I expect it to last the rest of my life. If you go used, any reputable seller will disinfect the razor for you in some pretty serious germ-killer, so there’s nothing to worry about there.

The sample pack I got was about the same, 20 or so dollars for 100 blades, and I’m about half of the way through after 10 months. My favorite blades so far (Dorco Blue) are some of the cheapest, currently $8 for 100, or 8 cents a blade. Each blade lasts me about a week, which is 3 face shaves and 1 legs. Some of the more expensive blades last longer, but cost disproportionately more and I don’t like how they feel on my face.

I too was worried about cutting myself more, but after getting the technique down (there’s really not much to it) I don’t think I could cut myself if I tried. The blade is sandwiched between the 2 layers of the razor head so it hardly sticks out at all, just enough to cut hair and nothing else. In fact, I’d be more worried now going back to a four or five blade razor; those blades are way more exposed. Using the safety razor also got rid of the razor burn I’d get on occasion.

New Investor Needs Guidance

Within the last few years I have become very interested in investing and want to make it one of my hobbies. Recently I took the initiative to act on the information rather than just be fascinated by it. In the Wealthy Barber Returns by Dave Chilton, he suggests a TFSA with half my money in GICs and the other half in big canadian companies with drips wherever possible. What do you think of this advice? Currently i have a TFSA with RBC bank $2000 in GICs and another $1500 I am about to invest in a direct investing account in the big canadian companies. My problem is I have no idea what companies to invest in for growth with dividends. I have little experience in investing (made a bit of money using a practise account) but have been watching Mad Money and a few other shows on CNBC and listening to Stansberry Radio and Peter Shiff’s podcast as suggested here to gather information. Anyone have any advice they can give a beginner investor?