Saving money is very important. But just having tons of money and hoarding it is pointless! Most people save money and leave it in their bank account. But here is the problem. Every day the money just sits there you LOSE MONEY!
This is because of opportunity cost and what you could be doing with that money elsewhere. For example, setting up a simple investment account can let you put that money to work to earn more money!
But if your money is just sitting in the bank you lose money each day. This is because bank interest rates are lower than the inflation rate.
Inflation is the rate at which the value of a currency is falling and consequently the general level of prices for goods and services is rising. I know this sounds less like a blog and more like Econ 101, but stick with me here and you will learn why this is so important.
The rate of inflation is usually around 2 to 3% per year.
The interest rate the bank pays you is less than that, usually less than 1% for a good savings account.
So you are actually losing money by keeping your money in your bank account.
It is important to keep money in your bank account to pay for your bills and be ready for emergencies but the rest of your money should be invested so it can work for you.
I’ve mentioned before that my favorite investments are rental properties. Not only are the people renting my properties paying for my investments, but they also provide me with passive income each and every month.
In order to buy real estate and scale your portfolio quickly, you have to master credit. By knowing everything there is to know about credit, you’ll be able to leverage it to your advantage and acquire lots of assets, even with little money down.
This is how I was able to do for myself and my CREDIT 101 online course will teach you exactly how you can do it too.
Another way to start investing with very little money is to invest in the stock market. You can do that through a free online brokerage. Any route you decide to take with your investments, the earlier you start, the better.
The longer your money stays invested, the more it will compound and that is how you accumulate great wealth.
Don’t just save money to leave it in your bank account, save to invest!