In recent years, the world's major economies have adopted ultra-low or negative interest rate policies to stimulate economic growth. Some banks in mainland China have also begun to test the negative interest rate policy, which will undoubtedly have a significant impact on our daily financial management.
Zhou Xiaochuan, a financial expert, said that if the deposit interest rate is determined to be negative, it means that our deposits will show a shrinking trend. Faced with this situation, he believes that there is only one way out of money, and that is to spend it.
This seems to be a far cry from how we think about money management. According to economists' analysis, the original intention behind negative interest rates is to encourage consumption and guide funds to shift from passive accumulation to active investment, so as to drive the real economy. However, from a personal finance perspective, if we do not take countermeasures, our savings interests will be negatively affected. Zhou Xiaochuan pointed out that if you want to keep your money from shrinking, spending it on necessities or strengthening reserves is the wisest choice.
Previously, we used to deposit excess income in bank accounts to earn a little interest income. But negative interest rates have changed that line of thinking. Zhou Xiaochuan believes that now it is best for us to implement the concept of active financial management, no longer deposit money in the bank as a "battery", but should consider investing in the production cycle, so that the funds can achieve the due value-added effect. For example, the purchase of electrical appliances, the improvement of living facilities, and the increase of daily necessities stockpile. This will not only avoid the shrinkage of assets caused by the negative impact of bank deposit rates, but also promote consumption and effectively help the economy recover.
At the same time, Zhou Xiaochuan also proposed that it is also a good choice for capable groups to actively participate in venture capital. For example, borrowing interest-free money from friends and family, supporting start-up projects, or investing in some personal real economy. This method can replace bank deposits to a certain extent, and maintain and increase value by sharing risks and returns. However, he also reminded investors to learn to weigh risks and choose projects with low barriers to entry.
Zhou Xiaochuan also believes that for young people and those who have just joined the company and have no savings, negative interest rates will actually become an opportunity. He explained that as negative interest rates encourage investment in the real economy, this will boost the employment and microfinance markets, providing more job and entrepreneurial opportunities for young people. At the same time, real estate in first-tier cities, as a real asset, will further release its value-added potential in the context of negative interest rates. This may be a good choice for young people who have just entered the society.
For those who need long-term savings, Zhou Xiaochuan suggested that they can consider buying financial products with certain returns, such as treasury bonds or funds. For example, although the current interest rate on treasury bonds is not high, it is relatively stable and can be used as a part of safe-haven investment. At the same time, it is also possible to appropriately increase the proportion of physical assets such as gold. In addition, some emerging funds in the technology sector, such as artificial intelligence and biotechnology, also have greater income potential in the long run, so it is worth checking out.
In general, Zhou Xiaochuan emphasized that negative interest rates should not be a condition for our financial management. In the face of the challenges brought about by this new environment, we should take the initiative to change our way of thinking, take the initiative based on the current situation, and adopt diversified financial management solutions to diversify risks.
Young people in first-tier cities can take real estate as their main investment; middle-aged and elderly people can increase the allocation of relative insurance assets such as treasury bonds; and those with more potential for small financial management can participate in venture capital. It is only by responding proactively that we can safeguard our interests in such a volatile and volatile market environment.
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