As I described in my book, Oxen: The Key to an Abundant Harvest, you truly begin winning with money when your “money makes money for you”.
With that said, here’s a great question to ask yourself: “How much interest is my bank paying me for the money in my savings account?”
Chances are high that the number is 0.01%. In fact, I checked several large banks and here’s what I found for their basic savings accounts:
- Bank of America – 0.01%
- Wells Fargo – 0.01%
- Bank of the West – 0.01%-0.02% (Depending on the state you live in)
This is why I hold all of my business and personal savings in ONLINE BANKS. This is not a “bank with website access”. They are banks that exist almost exclusively online. Since they do not have physical buildings, they have to do extraordinary things to attract customers, like offer higher interest rates. You can check out my top 5 reasons why I use online banks HERE.
Let’s look at an example. Let’s say you put $2,500 (one month’s of expenses – Rung 2 of the IWBNIN Ladder) into a savings account today. In one year you could earn almost $25.00 in interest from an online bank vs. $0.25 from one of the large banks. I’d say that’s a great deal! Now that might not seem like a significant amount of money to you but it’s free money and every little bit helps! Also, remember this is your savings account, not an investment account.
With this information, I’d encourage you to do 2 things:
- Find out how much interest your bank is currently paying on your savings.
- Check out the online banks that we recommend HERE.