What Is Money?

By | Personal FInance | No Comments

You may think you know what money is, but do you really? Before infinite banking, we couldn’t tell you what the definition of money was. We knew we liked it and needed it to survive, but what is money?

Money is a means of exchange. Simply put, if you buy bread for $2, you give the cashier $2, and you get bread. Hence bread is money and money is bread.

As our mentor, Ray Poteet, states, “We do things with money that we wouldn’t do with things money buys.” For instance, would you put bread in the freezer and wait 30 years to eat it? No way! Yet we put our money in banks, bonds, and policies and wait 30 years to use it. It really doesn’t make much sense when you think of it like that, does it?

Ridding Ourselves of Old Money Habits

Why do we allow our money to sit and not keep it in constant motion? The honest answer is that we’ve been programmed to believe that’s the best way to handle money. The banks have told us that the safest place to store our money is with them. “It’ll be ready for you when you need it,” they say.

Even our employers are in on the game: “We have a great retirement plan, and we match your contributions.” At the end of the day, it’s all just a ploy to get you to park your money so the banks can loan it back to you and others with interest, just as discussed in a previous blog (link to blog).

A Means of Exchange

Many years ago, before money was an idea, people exchanged good for goods in a barter system. If you had three chickens and needed a goat, you needed to find someone who had a goat and needed three chickens.

Over time, precious metals, such as silver and gold, started to replace the barter system. Later, paper money was introduced. Given that paper is worth very little, the governments had to step in and guarantee the worth of that paper with silver and gold. Since governments now control the value of money, the more that’s printed, the lower the value becomes.

That’s the definition of inflation. What cost $.05 in the 1940s costs $.50 in 2018. The price has increased because the value of the dollar has decreased.

Knowledge Is Power

Financial literacy is crucial to your financial success. At Wealth Nation, we take pride in educating our clients—and the public at large—about money and the system in which we live. As an individual, you need to educate yourself so you have the whole picture. You need to understand what money is and keep the “means of exchange” definition in your mind so that you can keep your money in motion.

Contact us today to get in on the conversation through a free consultation. We’ll help you start to see what money is in a different way.

Your Money Is Making the Bank Rich

By | Banking | No Comments

Did you know that banks are the most profitable businesses of all time? But how did they make that money? They did it by lending money at a higher interest rate than the cost of the money they have on hand. That’s right: your money is making the bank rich.

The Specifics of the Banking Business

Have you noticed that the bank gives you an interest rate of less than 1% on the money in your interest-bearing account? But while you’re not making any money, you can bet that they are.

Here’s a scenario:

The bank takes your $1,000. They pay you less than 1% interest. Then they loan that $1,000 to someone else at a higher rate, let’s say 10%. They’re keeping the 9%+ difference for themselves, thereby making money on every transaction.

What if you could do what the bank does and be just as effective at making money? You’d want to explore that option, right? We thought so!

Understanding Fractional Banking

Banks need money from depositors to loan to others. Fractional banking is the term used to describe exactly how the banks flip money. Every time you deposit money in the bank, the bank can turn around and loan 10 to 18 times that amount.

Here’s the math:

If you put $1,000 in the bank, the bank can lend up to $10,000 just from that one deposit. The bank doesn’t let your money sit; they immediately give it to someone else at a higher interest rate. The bank pools the deposits of all of their accounts and then lends that out, even sometimes back to you! Think about it: If you have a bank credit card, mortgage, or auto loan, the bank is taking your money and loaning it back to you—with interest!

Banks complete this process every day with everything we finance.

 

Make the Banks’ Process Work for You

If the banks have made this money-flipping business so profitable, could we copy that process for ourselves? Yes! You could build a to-scale bank for yourself and your family, including paying yourself interest!

At Wealth Nation, we teach our clients how to do exactly what the banks do. We help you create a secure banking system—backed by companies that have been around for more than 100 years—free from taxes, fees, and penalties. We’ve used this process for ourselves, so we know it works. Just try asking your financial advisor if they’re using the processes they recommend for themselves. Good question, right?

Contact us now to schedule your free consultation and learn how to keep more of your money, pay off debt, become financially independent, and build a legacy.