Understanding Interest Part 3
Uncover the truth about interest and its impact on your financial journey. Answer the three critical questions every investor should ask themselves.
The Truth About Interest: The Three Critical Questions
Answer The Three Critical Questions Every Investor Should Ask Themselves
If answering these questions leaves you feeling uncertain about your financial future, you are not alone.
The vast majority of investors are on the paying side of the financial system. Most people are not using their money efficiently and are losing purchasing power over time.
Fortunately, there are strategies that you can use to get on the right path to achieving your goals faster, safer, and with more certainty.
The Two Sides Of The Financial System
The Financial System Can Be Divided Into Two Sides:
The Paying Side of the Financial System
On the one side you have the vast majority of people who hand their hard-earned money over to others in an effort to participate in the economy.
On the paying side, you pay banking fees to deposit your money in an account. You then pay interest on loans needed to buy assets and still need to cover your basic living expenses and taxes. It is very difficult to build wealth if you are on the paying side of the financial system.
The Receiving Side of the Financial System
On the other side of the financial system are those who receive other people’s money and use it to build their own wealth.
Think about how banks use capital provided by depositors to fund loans for borrowers. The bank makes a profit by charging borrowers a much higher interest rate than they give the depositor. This strategy is called a ‘spread’.
Sophisticated investors use spreads to ensure that they are receiving rather than paying interest.
Watch “Understanding Interest Part 1: Are You a Payer or Receiver” to find out if you are on the paying or receiving side of the financial system.
The Truth About Interest: Four Types of Investors
In Part 2 of Understanding Interest, George explains that investors fall into one of four groups regarding interest.
- Those who pay interest
- Those who receive interest
- Those who avoid it altogether
- And those who pass interest on
Watch Understanding Interest Part 2: The Four Types of Investors to find out which group you fall into. You will learn how to join the only group successfully building wealth.
If you are ready to start working on your financial relationship, make sure to join us for our upcoming 3-Day Workshop.
