A Quebec Column Called the Method a Financial Mirage: Each Point Checked Under Canadian Rules

The headline is blunt. In October 2025, a personal finance column on Noovo Info set the method known as infinite banking beside other "financial mirages." Its opening rule is one most careful people already live by: when something looks too good to be true, it usually is.

Search for the method in French today and that column sits near the top of the first page. Google's AI overview cites it first. So a family in Quebec who hears about the method from a friend, a video or a seminar will very likely read it. That is a good thing. A careful critic is worth reading.

Why does this matter to you? Because the column makes sixteen distinct points, and they are not all the same kind of point. Some are simply right. Some are right about the way the method is sold and wrong about the contract underneath. A few need a date, a statute or one more sentence of context. If you treat them as one verdict, you can end up rejecting something that might have suited you, or buying something that does not, for reasons that have nothing to do with your own situation.

This page does not argue with the columnist. We agree with much of what he wrote, and we say so plainly below. What we do is take each point in turn, quote it briefly in our own translation for criticism and review, and check it against Canadian law and the documents we read for this page. Where he is right, we say so. Where he needs context, we give it.

Here is the summary, and then each point in turn.

What does the column say, and what does the record show?

Of the sixteen points checked here, eight hold as written, one holds once its dates are corrected, six hold only in part, and one depends on how the policy is designed. The column is strongest on how the method is sold. It needs context on how the contract itself behaves.

Now each point, one at a time.

Is "too good to be true" the right starting rule?

Yes. It is the right rule for any financial offer, and it applies to this one.

The column opens with a principle, not a fact about insurance: when a concept looks too good to be true, it usually is. We would not change a word of that. A specially designed, high-cash-value, participating whole life insurance policy is a long contract with real costs, and anyone who presents it as easy, fast or free of risk is presenting something other than the contract.

The useful question is what exactly is being called too good. If it is a promise of tax-free wealth without effort, the rule applies in full. If it is the contract itself, the right response is to read it: the guaranteed values, the premium schedule, the loan provisions and the surrender values in the early years. A contract can be judged on paper. Start there.

Where did the idea come from, and when?

The column is right that the idea came from the United States and from Nelson Nash, a life insurance agent. The decade needs a correction: Nash said he formulated it in the early 1980s, and his book appeared in 2000.

The column places the idea in the 1990s. Nash himself said he worked it out in the early 1980s, when borrowing was painfully expensive, taught it in seminars for years, and self-published his book in 2000. Those dates, and their sources, are on our page about who Nelson Nash was.

The difference is small, and it changes nothing in the column's argument. We note it because a reader checking the history will find the other dates and should not conclude that one of the two sources is careless. The fact that matters more is the one the column gets exactly right: the idea was developed under American law and American tax rules, and a Canadian family has to check it against Canadian ones.

Is a participating policy a vehicle for saving, investing and financing?

Partly. It can serve financing, and the column is right that people use it that way. It is not an investment, and on that point we are firmer than the column.

The column describes the policy as a vehicle "for saving, investment and financing" (our translation). A participating whole life policy is an insurance contract. Its first purpose is the death benefit. It is regulated as insurance by the provinces, not as a security, and it should never be compared with a fund as if both were investments. We explain why on our page on why life insurance is not an investment.

What the method adds is a way of using the contract. Over the years the policy builds cash value, and the insurer will lend against that value. A family can then finance a purchase it would otherwise finance with an outside lender. That is a financing use of an insurance contract. Calling it an investment is the mistake that regulators object to, and it is the mistake the column is right to distrust.

Do you "borrow from yourself" and pay the interest to your own policy?

No. The column reports that promoters say so, and it is right to doubt them. Under Canadian law the insurer advances its own money and receives the interest.

The column attributes this promise to the method's promoters: instead of borrowing from the bank, "you borrow from yourself and pay the interest to your own policy" (our translation). We agree with the column's doubt, and our reason is a statute. Subsection 148(9) of the Income Tax Act defines a policy loan as an amount advanced by an insurer to a policyholder in accordance with the terms and conditions of the policy.

So the money is the insurer's. Your cash value is the security for the loan. The interest is paid to the insurer, at the insurer's rate, and it is a real cost. The phrase about borrowing from yourself is one we have chosen never to use, for exactly the reason the column gives: it makes a loan sound free. How a loan actually works is set out on our page on policy loans.

Does cash value grow slowly in the early years?

Yes. The early years are the expensive years, and the column is right to say so first.

The column writes that "in the early years, the cash value grows very slowly" (our translation) and that a large part of the premiums pays fees and commissions. Both are true. A new policy carries the cost of insurance, the insurer's expenses and the agent's commission from the start, and the cash value in the first years is usually well below the premiums paid. Surrendering early can return less than you put in.

A design that directs part of the premium to paid-up additions is meant to build cash value sooner than a policy built mainly on base premium. It does not remove the early cost; it changes the shape of the curve. That is why the illustration matters more than any general statement, including ours. We disclose how the agent is paid because the commission is part of what the early premiums pay for.

Does it take ten to fifteen years to reach a positive return?

It depends on the design, the age and health of the insured, and the dividends actually paid. The year your cash value passes your premiums is printed in your own illustration.

The column says it often takes ten to fifteen years to reach a positive return. We do not offer a competing figure, for a simple reason: there is no single answer. The year depends on how much of the premium buys paid-up additions, on the age and health of the person insured, and on the dividends the insurer actually declares, which are not guaranteed.

What you can do is ask for the year in writing, in two columns: the guaranteed values and the illustrated values. If the guaranteed column never reaches the premiums you have paid within the time you expect to need the money, you know something important before you sign. Our page on reading the cash value table shows where to look.

Do variable loan rates make you lose value?

Partly. A loan that costs more than the growth of the value securing it reduces your net value. It does not reduce the cash value already credited to the policy.

The column warns that loan rates are variable, and that if they rise faster than the return credited to the policy, "you end up losing value" (our translation), pointing to 2022. The first half is correct: the loan rate is set by the insurer under the contract, and it can change. The second half needs one distinction.

Dividends are not guaranteed; a lower dividend slows future growth but does not reduce cash value already credited. A loan is a separate account. When its rate exceeds the growth of the cash value, the loan balance grows faster than the value securing it, so your net value, the cash value minus what you owe, grows more slowly. If interest is left unpaid, it is added to the loan, and the net value can shrink. Left long enough, a loan larger than the cash value can end the policy. That risk is real, and it is why a family that borrows should also repay. We compare the two rates on our page on loan interest and dividends.

Are the projections often optimistic?

On dividends the column is simply right: they are never guaranteed. The answer is to ask for the guaranteed values and a lower dividend scale, side by side.

The column notes that projections are often optimistic, and that participating returns are "never guaranteed" and depend on the insurer's financial results (our translation). Dividends are declared each year by the insurer's board. Past dividends do not promise future ones, and an illustration built on today's scale is an assumption, not a forecast.

An illustration is not a policy. Before you rely on one, ask for three things: the guaranteed column, the illustrated column on the current scale, and the same illustration on a lower dividend scale. The guaranteed column is the floor the contract promises, provided the premiums are paid and no loan is outstanding. The gap between the columns is the part that depends on future dividends.

Can one missed premium make the whole strategy collapse?

Partly. Premiums must be kept up, and stopping early is costly. A contract may offer ways to carry a short gap, and each of them has a price.

The column says these contracts demand iron discipline and that missing a premium risks bringing the whole strategy down. The discipline part is right. The method only works for a household that can pay the premium year after year, in ordinary years and in bad ones.

"Collapse" needs a little more precision. Depending on its terms, a participating contract may offer an automatic premium loan, the use of dividends toward the premium, or a conversion to reduced paid-up insurance. Each of these keeps the contract in force, and each has a cost: a loan that accrues interest, slower growth, or a smaller death benefit. Ask which options your contract offers and what each would cost you in a year when cash is short. Then choose a premium you can keep paying.

Does real estate belong to the original idea?

No, and the column is right to say so. Property is one possible use of a loan, not part of the concept.

The column observes that the method is now often tied to real estate, with the promise that "your money works twice" (our translation), and it answers that real estate has nothing to do with the original concept. We agree. The idea Nash described concerns financing the purchases a family makes anyway: a car, equipment, a down payment, a child's education.

A policy loan can pay for a property, as it can pay for anything else. But borrowing to buy an investment is leverage, and leverage carries its own risks whatever the source of the loan: vacancy, rate changes, a fall in value, and a loan that still has to be repaid. Our section for real estate investors treats those risks separately, as they should be.

Are the new names just the same leverage?

Partly. The column is right about leveraged investing under new labels. Nash's idea, as he described it, is about financing purchases, not about borrowing to chase a higher return.

The column lists a series of rebranded names and says that behind them sits the same principle: borrow at one rate to try to earn more elsewhere. For any arrangement that borrows to invest, that description is accurate, and the risks are the ordinary risks of leverage. A new name changes none of them.

The distinction we draw is narrow, and we draw it once. Financing a purchase you would have made anyway, with a loan you intend to repay, is a different decision from borrowing to buy an asset in the hope that it outperforms the loan. The first is about where your financing comes from. The second is a bet on returns. A reader should know which one is being proposed before saying yes to either.

What happens if a policy stops being exempt?

The column is right. If a policy is not an exempt policy, an amount is included in the owner's income on each policy anniversary.

The column warns against the "tax miracle" pitch and says that if a policy is no longer considered exempt, the accumulated values become taxable every year. That is what the law says. Subsection 12.2(1) of the Income Tax Act includes an amount in income, on each anniversary day, for a policy that is not an exempt policy. Section 306 of the Income Tax Regulations sets the test, comparing the policy's accumulating fund, determined without regard to any policy loan, with that of its exemption test policies.

Two more tax rules belong beside this one. A policy loan is a disposition under section 148, and the part of a loan above the adjusted cost basis is taxable, as our page on when a policy loan becomes taxable explains. And any pitch that promises a return that is guaranteed, untaxed and free of every risk, all at once, deserves the column's suspicion. Your accountant confirms your own position.

Do you need a legitimate economic reason to buy life insurance?

Partly. In Quebec you always have an insurable interest in your own life. What limits the coverage is the insurer's underwriting, and the first purpose of the contract is protection.

The column says you cannot buy life insurance simply to grow your money, and that you must show a legitimate economic link: income protection, a transfer to descendants, estate planning. The spirit of that is right. The legal detail needs one correction. Article 2419 of the Civil Code of Quebec says a person has an insurable interest in their own life and health. Article 2418 makes a contract null when the policyholder has no insurable interest in the life insured, unless that person consents in writing.

What the column describes is closer to financial underwriting. Before issuing a large policy, an insurer asks about income, net worth and the need the coverage serves, and it limits the amount to what those justify. We explain the process on our page on financial underwriting and insurable interest. The column's underlying point stands: a policy bought only for the accumulation, with no need for the protection, has lost its centre.

Who does it not suit?

Partly right. The warning fits households with uneven income or tight budgets. As a description of whole categories of people, it is too broad.

The column lists three groups the method does not suit: growing families, self-employed people with variable cash flow, and disciplined savers who could earn a stated net return in a balanced exchange-traded fund. On variable cash flow it is right: a premium that cannot be paid in a bad year is the most common way the method fails. On tight budgets it is also right.

"Growing families" is too broad as a rule. Some young families need permanent coverage, and some can carry a modest premium for decades; others cannot. The answer comes from the household's own figures. As for the comparison with a fund, the return the column names is an assumption about markets, not a fact, and it compares an insurance contract with an investment, which is the comparison we decline to make. Who the method does not suit is set out at the end of this page.

Is the sales vocabulary part of the problem?

Yes. The column is right that flattering words and a conspiratorial tone are a warning sign. We publish our own list of phrases we refuse to use.

The column names the vocabulary it distrusts, words that flatter the ego and promise hidden wealth, a multiplier effect or guaranteed income for life, and the pitch that "the rich have always done this and don't want you to know" (our translation). We agree with every part of that criticism. A strategy that needs secrecy or flattery to sell itself is telling you something about the seller.

This is why our restricted vocabulary page exists. It lists the phrases we do not use about the contract, the loan or our own work, and explains why each one misleads. The phrase about lending to yourself is on it. So are promises that wealth will simply follow.

Should you check the projections with independent professionals?

Yes. On this point the column and we say the same thing: your accountant, and where an estate is involved your lawyer or notary, should see the illustration before you sign.

The column closes with three questions: do I have a real need for insurance, does my situation justify this level of complexity, and have I checked the projections with independent professionals and a tax specialist? Those are the right three questions. We would add only that the person checking should understand how a participating policy is taxed in Canada, which is specialized knowledge.

Ask your accountant to read the guaranteed column, the illustrated column and the tax pages of the illustration. Ask what the adjusted cost basis will be in the years you plan to borrow. If the answers do not hold up, the decision is made, and that is a good outcome too.

Who should help you weigh this?

A licensed insurance professional with years of hands-on experience designing and servicing participating policies used for financing, who will show you the guaranteed values and a lower dividend scale; an accountant who understands section 148 of the Income Tax Act; and, where an estate is involved, a lawyer or, in Quebec, a notary.

The product without the understanding is just an insurance policy. The understanding without experience is just theory. In Quebec, the insurance professional is a Financial Security Advisor (conseiller en sécurité financière); in other provinces, a licensed life insurance agent. Check the licence in your province before you rely on anyone's advice, including ours.

How should you read this page?

It checks the points of one published column against Canadian statutes and the documents named in its sources. Quotations are short, translated by us, and used for criticism and review.

The column was read in full on 31 October 2026. Statutes are cited as consolidated on Justice Laws to 30 September 2026, and the Civil Code of Quebec as published on LégisQuébec to 15 October 2026. The page contains no illustration, no projection and no figure about any policy or insurer. Dividends on any participating policy are not guaranteed and are declared each year by the insurer's board.

What this page will not tell you

This page checks one column. It does not tell you whether a participating policy suits your family, whether a particular design is good, or what your own tax position would be. Those answers depend on your income, your need for coverage, your health and your plans, and they come from your insurance professional, your accountant and the insurer. For the wider set of criticisms, see what critics get right and the objections and risks section.

Who this does not suit

A specially designed, high-cash-value, participating whole life insurance policy used for financing does not suit you if your income is too uneven to carry a premium in a bad year, if you carry consumer debt you cannot pay down, if you have no emergency fund outside the policy, or if you are looking for an investment return. For those households, the column's caution is the right advice, and we would say so to their face.

It can suit you if you need permanent life insurance, have reliable surplus cash flow, finance purchases you would otherwise finance with a lender, and are willing to build the policy patiently and repay every loan. For those families, Infinite Financial Sovereignty® begins where the column ends: with the contract on the table, the guaranteed column read first, and your own accountant in the room. Read every critic, including this one. Then check each point, as we have done here, and decide with the documents in front of you.