Login

Lost your password?

Sign Up

Register

Login

Login

Lost your password?

Register

Tuesday, May 24, 2022
  • Home
  • Banking
  • Industry & Trade
  • Investing
  • Money Deals
  • Regional Markets
  • Tech & Biz
  • Countries
  • Opinion

Africa's
Investment
Gateway

The Exchange
  • Login
  • Register
Subscribe
This Month's Edition
Previous Editions
  • Home
  • Banking
  • Industry & Trade
  • Investing
  • Money Deals
  • Regional Markets
  • Tech & Biz
  • Countries
  • Opinion
No Result
View All Result
The Exchange
  • Home
  • Banking
  • Industry & Trade
  • Investing
  • Money Deals
  • Regional Markets
  • Tech & Biz
  • Countries
  • Opinion
No Result
View All Result
The Exchange
LOGIN
It is almost impossible to become wealthy from a salary. Many people are moving to supplement their salaries by getting involved in ‘side hustles’ where they can make extra cash. www.theexchange.africa

It is impossible to become wealthy by keeping your money in a bank. A bank account should only be for those transactions you cannot handle using cash. [Photo/Flickr]

Keeping money in the bank won’t make you wealthy

A bank account should only be for those transactions you cannot handle using cash

by Njenga Hakeenah
March 15, 2022
in Money Deals
0
Share on FacebookShare on LinkedIn
  • Your liquidity does not show your financial stability
  • Keeping money in the bank will not create you wealth
  • If you are in a class where a bank account is for prestige among your peers, you are doing yourself a disservice

Nobody gets rich by depositing their money with a financial institution unless you are dealing in the billions.

A financially secure future is not obvious to anyone who wants to enjoy a life free of financial worries and that is why this article is here.

You’re doing yourself a disservice if you’re in a class where having a bank account is a way to gain respect from your peers. You should only use a bank account for transactions that you cannot perform without cash. Despite all the advancements in technology, cash remains king.

Read: Sharpen your investment instincts

Having a lot of cash on hand does not necessarily imply that you are financially stable. Poof! There’s money today and then tomorrow it’s no longer there.

Keeping money in a bank will not help you get wealthy, since what your money should do for you should be far more important than what it does for the bank.

Why you should not keep your money in the bank

Is there anything better than having your money grow while you sleep? If you answered yes to this question, then read on. Join me and let us work towards becoming wealthy together.

If you’ve ever wondered why banks express interest rates as “per annum” (per year), here you get to know.

Let’s get one thing straight: the bank doesn’t exist to help you accumulate wealth; it exists to drain your account of all available funds. You can’t even use their pens without their tying a thread to them, because they don’t trust you enough yet they keep your money. Isn’t this bank’s tendency amusing?

The bank, on the other hand, will offer you a deal that is more favourable to them than to you, but in the fine print, it appears to be favourable to you as well. It’s in your favour most of the time, but it’s against your growth.

Since banks need to make money to stay afloat, this is not a crime.

For example, consider this situation. If the bank holds Ksh1,000 for you for a year, you’ll get, if they are not too focused on bankrupting you, Ksh200 in return. This is because of the annulated interest returns and the charges they impose on you.

With a rate of 14% per annum, you’ll make Ksh140 a year from your Ksh1,000 investment.

It’s important to note that the bank’s percentage is based on a year average, not a monthly average. If one assumes that their money would receive a monthly interest rate of 14 per cent, they will be surprised when they check their accounts at the end of the year.

Read: Are medical bills driving people into poverty in Kenya?

Bearing in mind the costs of banking, getting the Ksh140 may also be hard to come by.

Your money should work for you

Let’s take a look at a situation in which you invest your money and reap the benefits.

Starting a small business with a profit of less than Ksh50 per day is possible if you’re in a place and time when you can afford to do so. If you work every day for a year, how much money can you make with Sh1,000?

This is what happens if you’re successful in running your business.

If you can keep making the Ksh50 a day, then you’ve created a profitable business enterprise.

Assuming that you worked for 350 days and took 15 days off for vacations and other commitments, your Ksh1,000 would have earned you Ksh17,500 if the running costs were nil.

When it comes to a financial institution, you won’t get anything close to this kind of return even if you pay the bank’s charges.

Rich people never store their money in a bank; instead, they put it to work for them, generating additional income. When earnings soar, they reinvest the extra money, and the cycle continues, ending in a windfall for all.

Can you put your faith in yourself enough to start your own business with the money you have?

Read: Fintechs solving Africa’s generational challenges make continent innovation hub 

Tags: Financially secure futureinterest ratesliquidityMoney in the bankMoney rotsSmall business

STATE OF ECONOMY - GET THE REPORT

ASSESSING EAST AFRICA

Loading...

Njenga Hakeenah

I have 10 years of experience in multimedia journalism and I use the skills I have gained over this time to meet and ensure goal-surpassing editorial performance. Africa is my business and development on the continent is my heartbeat. Do you have a development story that has to be told? Reach me at [email protected] and we can showcase Africa together.

Related Posts

Twiga Foods launch new subsidiary
Investing

Twiga Foods invests $10 million to launch new subsidiary

May 18, 2022
Hotel Online travel tech in Africa (www.theexchange.africa)
Money Deals

South Korean unicorn Yanolja invests big in Kenya traveltech HotelOnline

April 22, 2022
L-R: Andrew Shirley, Maina Mwangi and Ben Woodhams. The Knight Frank Wealth Report notes that Kenya’s dollar millionaires are repatriating their wealth to adopted home countries. www.theexchange.africa
Kenya

Kenya’s dollar millionaires changing nationalities to move wealth

March 5, 2022
Next Post
www.theexchange.africa

What to expect from medical insurance in Africa post-Covid

Nyama choma which is a favourite for many Kenyans. Increasing consumption is creating a goldmine in Kenya’s meat market. www.theexchange.africa

Demand overwhelming Kenya’s meat supply

www.theexchange.africa

Kenya: Stanbic Bank, CMC Motors partner to offer financing for Ford vehicles




This months edition

May Edition

Features

EdTech role in African development
Tech & Business

EdTech’s role in African development

by Kanyali Muthui
May 16, 2022
0

Due to the pandemic, the topic of innovation in education has never been more crucial.  While most developed countries moved...

Read more
investment in African science and technology
Tech & Business

Investing in Africa’s science and technology: Where are we now?

by Kanyali Muthui
May 16, 2022
0

The continent’s digital revolution can largely be driven by building the necessary skills for the short- and long-term future, and...

Read more
Fintech revolution in Africa
Tech & Business

The Fintech Revolution in Africa’s FX Markets

by Kanyali Muthui
May 11, 2022
0

With over 548 million registered mobile money users in sub-Saharan Africa, increased internet access and readily available mobile money solutions,...

Read more
www.theexchange.africa
Countries

US – Nigeria Trade Relations: An Overview

by Wanjiku Njugunah
May 2, 2022
0

Nigeria is currently the United States' 54th largest goods trading partner, with US$7.8 billion in total goods trade as of...

Read more
A previous conference for African Insurtech sector. The Insurtech boom is deepening insurance uptake in Africa. www.theexchange.africa
Tech & Business

Insurtech boom deepening the uptake of insurance in Africa

by june njoroge
May 2, 2022
0

Kenya-based Pula is another distinguished insurtech making waves in the continent. It provides small scale farmers with agricultural insurance and...

Read more

News

Banking
Industry & Trade
Investing
Money Deals
Regional Markets
Tech & Biz
Opinion

Countries

Kenya
Tanzania
Uganda
Burundi
Rwanda
Southern Africa
Ethiopia

More

My Account
Contact us
Advertise
About us
Help Center

Subscribers Center

E-paper
Premium Stories
Education Rates
Corporate Subscriptions
Weekely Newsletter

  • My account
  • About us
  • Advertise
  • Contact
  • Privacy Policy
  • Refund Policy – The Exchange
  • Sitemap

No Result
View All Result
  • Home
  • Banking
  • Industry & Trade
  • Investing
  • Money Deals
  • Regional Markets
  • Tech & Biz
  • Countries
  • Opinion
  • Login
  • Sign Up
  • Cart

© 2021 The Exchange - Powered by MediapixManaged by Supported by Digihandler,

Welcome Back!

Login to your account below

Forgotten Password? Sign Up

Create New Account!

Fill the forms below to register

All fields are required. Log In

Retrieve your password

Please enter your username or email address to reset your password.

Log In