Why You Should STOP Saving Money - DO THIS NOW
Published: 2021-08-13
Status:
Available
|
Analyzed
Published: 2021-08-13
Status:
Available
|
Analyzed
Predictions from this Video
Incorrect: 0
Prediction
Topic
Status
High-yield savings accounts are currently offering approximately 0.5% annual interest.
"right now some of the highest interest savings accounts out there pay you about a half a percent in interest every single year"
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With inflation at 3.5% and savings accounts earning 0.5%, individuals lose 3% of their money's value annually by keeping it in savings.
"if you consider that inflation is three and a half percent a year and you're making a half a percent a year you're essentially losing three percent of your money every year just by keeping your money safe in a bank account"
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Certificates of Deposit (CDs) are currently offering around 0.7% interest for a one-year term.
"right now the interest rate is about point seven percent for one year in the high end"
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Junk bonds are expected to yield approximately 4% in interest.
"if you want to go and buy a junk bond that will pay you back about four percent in interest"
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California state bonds are offering an interest rate of 0.7%.
"if you want to buy an incredibly safe state bond like california they'll pay you back point seven percent interest"
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The Vanguard Total Bond Market ETF (BND) currently yields 1.94%.
"a good example of this is through the vanguard etf vividly x which pays you right now 1.94 return on your money"
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Since the year 2000, a total stock market index fund (like VT) has averaged an 8.38% annual return, including dividends.
"since the year 2000 it's managed to average an 8.38 return plus dividends"
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During the March 2020 COVID-19 crash, a total stock market index fund (like VT) lost 33% of its value within 30 days.
"during the 2020 covet crash this fund's lost 33 in value in 30 days"
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During the Great Recession, a total stock market index fund (like VT) lost 50% of its value over a two-year period.
"throughout the great recession it lost 50 percent over two years"
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Meta Platforms (formerly Facebook) stock has increased by 37% year-to-date.
"facebook is up 37"
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C3.ai stock has declined by 45% over the past eight months.
"you buy into a stock like c3ai which went down 45 throughout the last eight months"
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Bitcoin has been the best-performing asset over the past decade.
"bitcoin has been the best performing asset of the last decade"
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Dogecoin experienced a greater increase in value over the past year than Bitcoin.
"dogecoin went up even higher throughout the last year"
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Cryptocurrencies can experience routine drops of 50% to 90%.
"we've also seen drops of 50 to 90 percent on a routine basis"
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Individuals holding cash missed out on a 30% increase in the stock market over the past year.
"if you kept your money in cash you missed out on a 30 increase in the stock market"
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Concerns exist that increased spending and money printing will devalue the US dollar.
"The very beginning the worry was that a surplus of spending and money printing would devalue the us dollar and our money would consequently be worth less as a result."
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Inflation experienced its fastest increase in over a decade.
"Inflation rose at the fastest pace in more than a decade."
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Stocks and real estate reached record highs, with overall prices increasing by an average of 5.4% year-over-year.
"Stocks and real estate hit new record highs and across nearly every metric things are getting more expensive averaging 5.4 year over year"
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Georgia experienced a particularly high inflation rate of 11.9%.
"if you live in georgia unfortunately inflation came in at a staggering 11.9 percent"
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Real estate allows borrowing money at interest rates currently below the rate of inflation.
"real estate offers you the opportunity to borrow money at an incredibly low interest rate that right now is below the rate of inflation"
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A $2.4 million mortgage at 2.875% interest rate, with 4% annual inflation, results in a gain of $30,000 from borrowing.
"i have a 2.4 million dollar mortgage at a 2.875 interest rate and when inflation is 4 year-over-year i've effectively just made 30 000 for borrowing money"
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Rental prices are projected to rise over the next few years.
"rental prices are expected to continue increasing over the next few years"
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Americans anticipate year-over-year inflation of 4.8%, with a three-year average expectation of 3.7%.
"americans believe inflation is going to be worse than expected at 4.8 year over year over three years the expectation is an average of 3.7"
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Tyson Foods plans to increase the cost of its products.
"tyson having announced that they'll have to raise the cost of their foods"
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Investors predict that inflation will decrease to an average of 2.8% over the next 10 years.
"investors are betting that inflation is not going to last and that over the next 10 years it will decline to an average of 2.8 percent"
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For savings goals of 1-3 years, investing in a broad index fund is recommended. For 3-5 year goals, a mix of index funds and individual stocks is suggested.
"if you're saving up for something that's one to three years away then consider investing some of that in a broad index fund to balance out your risk Then if you're saving up for something that's three to five years away it's probably better you carefully invest in an index fund or a few specifically picked out stocks"
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Beyond essential cash reserves, all remaining funds are immediately invested in index funds, stocks, and cryptocurrency.
"everything else is immediately siphoned out from my account and invested in index funds stocks and crypto"
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