I wonder how many know how banks make their money?
That we as consumers, willingly deposit our money with them, which at the end of the year will earn a measly 1% interest? And we're happy with that?!
I wonder how many know that the money we deposit, is used by banks to use for investment in mutual funds and stocks, which earn 8-12% annual interest conservatively! And it could go as high as 30-40% per year! And yet, we're happy with the 1% interest? When the thing is, inflation rate is about 7%, meaning the money that we put in the bank loses it's value!
Tsk tsk! I only learned of this recently, and it astounded me that so many of us do not know this!
Hence, I think we should put our savings in investments.
I have three bank accounts. I recently opened a new one at BPI Maxi-Savers, because it earns interest monthly (instead of annually). But my original BPI Regular Savings is my active account, which I use to regularly transact everyday expenses. And I have a deposit account at RCBC, simply because of payroll... And I will have a new deposit account at Metrobank, also because of Payroll, and I will use this to conduct transactions and invest in FAMI (a mutual fund).
I originally want to close my BPI Regular Savings account, and transfer everything to Maxi-Savers, however I cannot make withdrawals within a month (actually I can, but I can have the incentive of having a higher monthly interest rate if I didn't make a withdrawal).
Anyway, I may want to simplify my life and close some of my bank accounts, but I guess this is part of diversification. Diversification, meaning putting your money in different sort of investments. I have money in banks, stocks, and mutual funds.
Anyway, I'll go about this tomorrow... I still have some working to do. I'm currently on duty while I'm writing hehe
That we as consumers, willingly deposit our money with them, which at the end of the year will earn a measly 1% interest? And we're happy with that?!
I wonder how many know that the money we deposit, is used by banks to use for investment in mutual funds and stocks, which earn 8-12% annual interest conservatively! And it could go as high as 30-40% per year! And yet, we're happy with the 1% interest? When the thing is, inflation rate is about 7%, meaning the money that we put in the bank loses it's value!
Tsk tsk! I only learned of this recently, and it astounded me that so many of us do not know this!
Hence, I think we should put our savings in investments.
I have three bank accounts. I recently opened a new one at BPI Maxi-Savers, because it earns interest monthly (instead of annually). But my original BPI Regular Savings is my active account, which I use to regularly transact everyday expenses. And I have a deposit account at RCBC, simply because of payroll... And I will have a new deposit account at Metrobank, also because of Payroll, and I will use this to conduct transactions and invest in FAMI (a mutual fund).
I originally want to close my BPI Regular Savings account, and transfer everything to Maxi-Savers, however I cannot make withdrawals within a month (actually I can, but I can have the incentive of having a higher monthly interest rate if I didn't make a withdrawal).
Anyway, I may want to simplify my life and close some of my bank accounts, but I guess this is part of diversification. Diversification, meaning putting your money in different sort of investments. I have money in banks, stocks, and mutual funds.
Anyway, I'll go about this tomorrow... I still have some working to do. I'm currently on duty while I'm writing hehe
