We have all believed that saving money is the best way to archive financial freedom but what if we are wrong?
Let’s do some math, when you save money at the best you are getting is about 1 percent in yield but if you noticed inflation is running over 2 percent, so by having money in the bank, you are effectively losing money every month.
We must learn that money must mint money from all the available and doable opportunities rather than solely depending on the banks. Unlike us, the rich grow their wealth in a different way which is not really that complicated.
So, what they really do? They buy assets, real estate, gold or any item that they think will increase in value in the future. Historically inflation rates have fluctuated wildly. In the year 1997, we had double digit year to year inflation. Imagine losing 10 percent or more of the value of your money in just 1 year. It would be like getting a 10 plus percent pay cut.
Thus, if someone just saves and doesn’t invest [fear of loss], over a period, the saved liquidity may appear to have grown hypnotically. However, it would have shrunk when compared with other evolving economical parameters.
That's why Monest recommend Financial Literacy to everyone because with just a little understanding/insight of the Economy and opportunities available, we believe anyone can reach their financial goal.
Make informed decisions to invest - but do invest!