Becoming Your Own Bank
In today's world almost everyone relies on banks. Most people and businesses could not survive without banks. It seems like there is a bank on every street corner, and the well- managed banks are making huge profits. Have you ever given any thought about the way banks function and how simple the business model really is?
It goes like this:
*The customers deposit their hard earned money in their bank to keep it safe.
*The bank takes those deposits and invests the money into a liquid, interest bearing account until they find a borrower.
*The bank then loans the money out to the borrower and charges an interest rate.
*The bank pays a smaller interest rate to its depositors.
*The bank makes money on the spread between what interest rate they receive vs. the interest they pay out. This is known as arbitrage.
It is a simple, and very effective money management strategy. What interest rate is your savings or checking account earning? What interest rate are you paying on your home or car loan? Pretty good deal for the banks, huh? It reminds me of the old saying "He who has the gold makes the rules." What if instead of paying all that interest to your bank you paid it to yourself? You could make those big profits by borrowing money from your "bank."
If you own the bank:
*You still make your regular deposits.
*Your money is safe, earning a fair rate of interest, and growing tax deferred.
*When you need to borrow money, you borrow from yourself.
*You pay yourself back with interest.
Wouldn't this be a much better way to manage your money? Wouldn't it be liberating to say good-bye to banks and credit card companies? This is a great way to build wealth. The bottom line is your money is growing much faster because you're recouping all those interest payments that would normally go to your bank or credit card company.
Consider the advantages of becoming your own bank:
*No more worries about credit reports.
*You'll never be turned down for a loan.
*Your money is readily available for emergencies.
*You make all the profits.
*You are building a tax free retirement income.
Hopefully, by now you like the idea of becoming your own bank. You need three things to make this work. You will need patience, discipline, and the right investment vehicle.
This money management strategy is powerful. With patience, determination, and discipline you can become your own banker. You will be employing the same strategies banks and credit card companies use to create enormous wealth. So, pay interest to yourself when you borrow money and enjoy owning your own "bank."
Note: To learn more about this strategy call my office and I will be happy to go into further detail with you. 865-470-4162