You can see how big this “ship” is compared to the aquarium behind it. I took this during Covid times while in Spain.
Welcome back!
So, have you heard of the 8th Wonder of the World? Here’s a hint, some guy from a company called Berkshire Hathaway mentions it. His name is Warren Buffett. . I know!! Google here you come!!! Who is this Buffet and what is the 8th Wonder of the World? I thought there were only 7!!!
Today you are going to learn about the “8th” wonder of the world as I tackle the subject on where to put your hard earned $$$ once you start working and making real money. A lot of people I know often keep most of their money in a checking account, even a lot of the tenants I interview will do the same. Few people having savings accounts, and the ones that do, will often store their money in an associated account at the same BIG bank as their checking account. All the while earning a measly 0.010% APY. Don’t believe that they pay that low? See the embedded photo of my savings account with one of the bigger banks. (Obviously I don’t use it haha)
THIS is crazy and must come to an end. Your money could and should be working for you while you sleep! That statement refers directly to the question in the title of this post. Mr. Buffet calls the 8th wonder of the world “Compound interest”. Warren Buffett has defined compound interest as the interest earned on both the principal and the accumulated interest. He has also said that compound interest is the most powerful force in the universe and the greatest invention in human history!!!
This is how the rich get richer and it needs to be our goal if we wish to be financially independent one day with the ability to pass on some of our wealth to the next generation. Compound interest is a tool that rich and financially literate people learn about very early to growth their wealth and pass the knowledge on to their loved ones. An easy way to start down the path of financial independence and having your money begin to work for you; can be as simple as moving it to a company that will pay you more for simply keeping your money with them. Today this is as easy as Googling or Bing-ing (idk if that’s a thing) highest yielding saving accounts, money market accounts or C.D’s. You can open an account in minutes and start transfers within a few days.
Again, this is for growing your money not spending your money. A physical location is not necessary, you can make withdrawals as needed as often as 6 times a month in most cases. This also gives you another source of protection as all your money isn’t tied up with one institution or underneath one account that could get hacked or what not. When I started out and even now, I prefer to use a high yield money market account for my cash or funds I want to be liquid (easily accessible). The APY % blows normal savings accounts out of the water and I still have plenty enough ease to get to my funds in a timely manner in case of emergency (via a wire or ACH transfer). If I needed money RIGHT now, then I would simply put it on a credit card then pay it off with my money market or other emergency fund holding.
Another benefit is if you are bad with saving and get an itch to spend; having money in a different account you don’t always see and limited to 6 withdrawals a month, can help you grow the account faster by avoiding temptation. I like to set it and forget it. Then I am pleasantly surprised when I check back a few months later and see $$$$$ without me doing anything extra besides initially setting up my automatic deposits from each paycheck. Trust me, once you see the growth of your account over 1 – 2 years of consistent deposits and monthly interest deposits. You compare that to the last 10 years of your “savings” account and you’ll be kicking yourself for not starting earlier. If you are like me and you see how easy it is to start getting some of this passive income everyone talks about. You WILL become addicted to finding ways to grow it bigger and faster. Your future self will thank you!!
I was going to make a huge post and tackle the differences between traditional savings accounts, CD’s, Money market accounts, and Roth IRA’s. Where and how much to save for your emergency fund, as well as some recommendations for companies and the products I’m currently using. However, I realized that it would be a massive post and likely become overwhelming if this is the first time hearing this stuff. So, I am going to break it up a little and cover it over a few posts. So Stay tuned!!!
Update:
In the meantime, if you can’t wait to start having your money work for you. Have a look at Sofi Checking & Savings accounts. Right now, they are offering customers 4.50% APY on the savings account and 0.50% on the checking account. Sure beats 0.010% from big banks and is one of the highest I’ve seen around. They are also giving referrals $25-$250 to get started after funding with at least $10 and setting up direct deposit!!! We know I love FREE money and I hope you do too! Be sure to use the link if you are interested in using this company.
Wealth, Health,& Fitness 
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