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Why Saving Money Won’t Make You Rich
makes you disciplined and of the utmost
importance it allows you to accumulate
funds and capital to do
a lot of things saving things gives you
security
something to fall back on in case the
worst of the worst happens
or in the event of an emergency or for
retirement job termination
or forced exit from a job but all these
cannot make you rich
they can make you at least comfortable
but not rich
the understanding of how to manage money
how money works and how to grow it is
what makes you rich
continue watching to find out why saving
money does not make you rich
number eight inflation this is the main
reason why saving doesn't make you rich
why it erodes the value of the money in
your savings
inflation is simply the increase in the
prices of goods and the accompanying
reduction in the currency values that
are used in purchasing them
in saving there is this illusion that an
absolute increase in the amount of money
in possession
translates to the power that amount
commands that's not true
the power your money commands is the
function of the number of things you can
buy with that money
another reason why money may be losing
value as a result of inflation
is the government the government is
concerned with money creation
and too much of it as it was done during
the pandemic can give
rise to overheated financial bubbles
this is a result of too much easy money
in the system
government creating too much money which
is used to chase a few goods
also leads to inflation decreasing the
purchasing power of the currency
and reducing value to beat inflation
your best bet is to invest your money in
things that can produce profits that
beat the inflation rate
number seven rich banks banks are the
best place to keep your money
this is because they keep it safe and
secured
but do you know they trade with them yes
they do
banks trade with depositors money to
make profits one way of doing that is by
giving out loans
and they give these loans at a very high
interest rate
they get rich by doing that true they
pay you interest
but is it worth it don't forget banks
also charge for depositing money with
them
and even withdrawing them and they also
make deductions from the account that
are higher than the accrued interest
number six return on savings all
accounts opened in the bank attract
interest so does the savings account but
there is a big difference
the interest in the savings account is
low so minute
and very inconsequential it's not a good
motivator for saving
and yet you'd wonder why people are
still saving well there's a benefit of
saving in the bank as we mentioned
earlier
saving in the bank keeps your money safe
and secured
that's that there is little or no
returns on savings
number five failing banks yes we agree
that saving money in the bank is safe
but that is not a hundred percent true
leaving your money
is not always safe there are many cases
of bank failure and banks collapsing
a bank may collapse or fail due to
several reasons they are consolidation
policy or the review of the universal
banking model
and each time any of these happens
people lose money
lots of money most times some of this
money is recovered
but it is so low that the comfort it
gives is majorly enjoyed by large
deposit clients
the small deposits clients get but a
pittance of what they saved
number four willpower to keep a good
saving record a high degree of
discipline is needed
i'm not saying you don't have that
neither am i judging but the willpower
to save is only strong until it is
attacked by intervening variables
these variables may cause not just a
disruption in your savings
but may also end the program it may be
easier for a corporate body to maintain
its willpower to save
but it is usually not the case when
personal finance is concerned
because it requires a lot of cognitive
effort
number three expenses from unplanned
events
you know the saying that life happens
yes it does
live events happen inevitably you don't
plan for these occurrences but they will
happen
events like the death of a loved one
loss of income fire
accidents that can hospitalize and
burglary when this happens you go back
to your savings to help the situation
and solve emergency needs irrespective
of the main purpose of saving
expenses from unplanned events use up
savings and liquidate assets you get
relief from the problem
but you would have taken a couple of
steps back in your financial goal
or may even have to start afresh
number two opportunity aversion saving
makes you timid towards opportunities
you become anxious when the opportunity
to grow your savings comes
i am not saying that there is anything
wrong in exercising caution and weighing
the pros and cons of any opportunity
before investing
but in building wealth the risk element
is expected
it's a necessary evil cautious people
who secure their money rather than
multiplying it
end up not becoming rich number one
saving without investment it's no new
thing that saving without investing
doesn't make you rich
the richest people in the world like
bill gates elon musk jeff bezos and the
likes
invest saving without investment makes
you poorer
because you're averse to risk and
repelled from opportunities
it is like looking at your money just
sitting and not converting it to paying
assets
in the business of amassing wealth for
yourself and getting rich
no one can be more committed to it than
you but when you continuously focus on
saving your money in the bank
you may be led into the false sense of
security that you have something to fall
back on
this will limit your desire to
understand how money works
how to use it and how to grow it this
understanding is necessary for getting
rich
of course saving will not make you rich
but don't stop
it is proof that money is under your
control and you're not
under its control add investing to your
saving efforts and watch your wealth
eventually grow
having stayed until the end of the video
what are your thoughts on this topic
do you think saving can help someone get
rich do not hesitate to drop your
suggestions and opinions in the comments
section also remember to like thi
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