Don’t Let the Banks Use You

Most people think putting money in a bank is a safe asset. They think if you put $100 in the bank today, it will still have the same $100 value a year from now. The truth is that $100 will not be able to buy you the same things a year from now as it could today. That $100 will lose value because of inflation, so you will only lose money by letting your money sit in a bank.

Banks make money from your money.

Banks profit from the money you keep in them. As soon as you deposit your money, the banks view it as a liability because, for them, that cash is losing value to inflation. They will want to get that money invested as soon as possible, so they will lend your money out turning your money into an asset for them.

Your money will never outgrow inflation in the bank.

Do not keep all your cash in the bank. It can be okay to keep your emergency fund in the bank, and any savings you are working on for a big purchase or investment, but other than that, it’s a good idea to make sure any other money you have is out working for you. Do not let your dollars just sit in a bank to get eaten up by inflation.

Use banks the right way.

Nobody has become wealthy by only saving their money. People become wealthy by investing and putting their money to work for them.

Do not put all your money in the bank as that only makes the banks rich. Use banks the right way by using them to hold your emergency fund and any other big purchase or investment savings you are working on, and then be sure all your extra dollars are out working for you.

If you want to become wealthy, learn and do what the wealthy do. Learn to USE banks the correct way, so they do not end up using you.