Should you keep your money in banks for Investment??

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The big question today arises if the money kept in banks is a form of investment or not? 

Now what is "INVESTMENT" ??
Investment, is the decision which an investor takes where he uses his money to generate a fixed amount of interest over a period of time, the principal smount remaining intact.

The banks give a prescribed rate of interest in their savings account and also on their schemes made for "economic welfare" known as fixed deposits.

A majority of households in India considers that banks are the best institutions humans has ever created because of two reasons,
first - money is totally safe and they will never loose their money if they keep it safely in banks.
second - interest of 6% is given as extra in savings and fixed deposits. 

If you think the same, then you have not got another 2 things clear until now.

First - the power of money and its wonders of multiplying itself to 1000 times dhen invested correctly.

Second - the concept of risk and how to scale it down in order to reduce it.

Coming back to the question, why you shouldn't consider your money in banks as an investment??

This is because majority of Indian Banks give an interest rate of 6% approximately (in fixed deposits and savings account) whereas the average rate of inflation in India is close to 6%.
Now, what does Inflation means?
Inflation is the rise in price (or price hike) of the common goods or a large number of goods in an economy (i.e. a country).

How does it effect people?
Inflation is the thing which decreases the value of money and the purchasing power of the consumer. 
For example, if the cost of a product is          Rs 100 and rate of inflation per year is 6% per year, then at the end of the year the price of that good will be Rs 106.
An increment of Rs 6 is observed in the product price due to Inflation.

This means that if the bank is giving you a 6% interest and the average rate of inflation in India is 6% (as said earlier), then the total profit made by the accountholder is Rs 0 (nil). So, depositing money in Banks is not an investment. The interest rate is not able to beat the inflation rate to get an amount in your hand.

The accountholder made zero income out of the money he deposited in bank a year ago.

Those who has this belief in mind that "money kept in banks are totally safe" then letme clear out, 
Before the biggest scams of the country like 
* the PNB scam
* the Yes Bank scam
* the Rotomac Bank fraud
the account holders of these banks thought the same !!!!

OUR MONEY IS SAFE, IS IT????

Get this directly in your mind, " even stepping out of the house, or sitting inside the house is not safe"
The house may fall over you, a car may hit you on the road etc.

Still, we do step out of our houses and live in multiple storyed houses fearlessly, Why??
Because we are aware that it will not harm us due to precautions taken by us which reduces the risk in each activity. 

Therefore, it is very clear that some amount of risk is incolvedvin every action we undertake but we scale down its percentage by taking precautions.

The "Bank" now becomes useless because we cannot use it for investment neither it is 100% safe.

Honestly speaking, in today's time, one should use bank only for 
* Net banking 
* Financial Transactions
* Conversion of currency 
                with safety.
The bank has no other use.

Then, how should we use that power of money which can multiply itself  "multiple" times.

Invest in these places : 
1. Stocks/Shares
2. Mutual Funds
3. Bonds/Debentures
4. Real Estate 
5. Gold/Silver
6. Properties
7. IPOs
8. Startups/Companies as passive partners. 

Trust me, if you know how to scale the risk down, they provide far better profits.

Regards,
Ankita Gupta ❤
Connect to me : Connect




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