If you look into each individual in this society, over 60% of world population are registered in a bank and own an account where they deposit/withdraw money from, everything looks smooth. But do you know the hidden scene about the banking system how it works, why should you not let your money inside it, how to be safe ? We will cover these topics in the following article.
A banking system how it works ?
After opening an account in your local bank/online bank, you’ll be able to make purchases either locally or online and be able to receive money whether from your salary, business or a bank transfer from someone. Your bank is in a winning streak more than you. One, they take their bank contributions either it could be anually or monthly, that means they take their profit because you are using the credit card. Two, whenever someone make a transfer or you withdraw money, they take their part too which is a small percentage but they do gain alot from that because you’re not the only one they deal with. Three, your money that you have in your bank account is moving from a place to place, let’s give you an example so you can understand better. John is an employee and wants to buy a house that costs 500 000$, he will follow the band and will take a loan from the bank which will grante him to own a house but he’ll have to pay interests, the bank will take from the clients their money and give it to John but the agency still have a storage of money which represents the amount of the money deposited in clients’s account so they wont be in trouble. Let’s get back to our dear employee, if he starts to transfer 250$/month to the bank and reach a total of 500k$ he will still have to pay more, as said the “interests”, from that the bank is in a winning strike without losing any casualties. Four, the banks also can get income from investing in real estate, projects or even trading (we’ll talk about that in another article).
Keeping your money in your bank means Inflation!
Yes you heard that word, inflation is the rate of increase in prices over a given period of time. Let’s say a price of bread is 2$ and you put 3$ in your bank account and let it over the time, and comeback after couple of years and want to buy a bread, but you found it became 4$, your saved 3$ could not buy you anymore the desired food so that is inflation in a simple way. Inflation is applicable to anything that could be exchanged or bought by a currency.
What can you do to advoid inflations and be in a winning strike ?
The only way you can take to flee from inflation is “investing”. This last term has many paths to achieve it so it could be either from investing in real estate or trading, stocks, bonds, or personal investing such as taking financial courses to learn skills and bring money. But it comes with high risk since it is not sure and could have some volatility on it.
Crypto wallets is the alternative to bank systems!
Crypto wallets are lifesavers, since no party or government is controlling it. You can open a new one, buy cryptocurrencies with your credit card and there you go. Some websites started to accept the fact you can purchase their services/goods with crypto wallets but not all of them support that. Another good advantage is that you can send and receive cryptocurrencies thanks to wallets addresses, not like the traditional way of banks, where you have to wait a certain delay till the money arrive to it destination or any kind of problem.
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