For the first time in 20 years, banks are tightening their belts and stop thinking about "money makes money".
We are in the midst of a revolution in the banking industry, and this change is so violent that we all have to re-examine our relationship with money. Do you remember? Twenty years ago, the slogan of banks was "money makes money", like a perpetual motion machine that continuously generates income. But now, the banks are tightening their belts, and we can no longer just think about making money work for us, as we did in the past, but we have to start learning to make money work for us.
1. The new normal for banks
Banks, once seen as "money treasuries", are undergoing an unprecedented transformation. In the past, the bank was a gathering place for money, we put money in, the bank gave us interest, and then we continued to save and continue to earn. But now, that model is gradually unraveling.
With the advancement of technology and the popularization of the Internet, traditional banks are facing unprecedented challenges. Emerging financial models such as internet finance, mobile payments, and digital currencies are rapidly emerging, which not only provide more convenient services, but also reduce transaction costs. As a result, traditional banks have had to re-examine their business strategies.
Second, money is no longer the only pursuit
In the past, we always treated money as the only pursuit. We work hard just to make more money and then put it in the bank in the hope that it will bring us more money. But now, this model no longer works.
First, interest rates are getting lower and lower for banks. Due to fierce competition and rising cost of funds, banks have had to lower interest rates to attract deposits. This means that we can no longer live on bank interest.
Second, inflation has been eroding our wealth. Although the bank gives us some interest, this is nowhere near the rate of inflation. Our money is becoming less and less valuable, and our purchasing power is constantly decreasing.
Finally, investing is becoming more and more complex. In the past, we only had to deposit our money in the bank and we could sit on it and receive interest. But now, investing is becoming more complex and riskier. We should not only think about what to invest in, but also how to diversify our risk and how to protect our principal.
3. Learn to make money work for us
In the face of such changes, we can no longer just think about making money work for us, as we did in the past. Instead, we should learn to make money work for us.
First of all, we need to improve our financial quotient. Financial quotient refers to our ability to manage our wealth, including knowledge of investment, financial management, taxation, etc. Only by improving our financial quotient can we better manage our wealth and make money work for us.
Second, we need to learn to diversify. Don't invest all your money in one place, learn to diversify your investments and reduce your risk. That way, even if an investment fails, we won't lose much.
Finally, we need to be cautious. Investment is risky, and you need to be cautious when entering the market. We must not take risks investing because of greed in the moment, we must learn to control our desires and be cautious.
Banks have undergone tremendous changes over the past two decades, and we have also undergone a shift from "money makes money" to "make money work for us". It's a painful process, but it's also a necessary one.
We can no longer just think about making money work for us, as we did in the past, but learn to make money work for us. Only in this way will we be able to gain a foothold in the financial world of the future.
Now that the banks have tightened their belts, we should also tighten our belts. Stop thinking about "money makes money", let's learn to make money work for us, and meet this new era full of challenges and opportunities together.