7 truths about money that banks don’t want you to know

Understanding the Banking System

In this video, we learn about the banking system and how it works. We also discover some truths about money that banks don't want us to know.

The Truths About Money

• You're losing money every year: Inflation causes the value of your money to decrease over time, meaning you lose money by keeping it in a bank account.

• Banks earn from your card transactions: Banks make money through processing fees when you use your credit or debit card for purchases. Merchants may include these fees in their sales price, which means you end up paying them.

• Credit cards can be costly: While banks offer incentives for signing up for credit cards, they can raise interest rates at any time. This means you could end up paying more than you bargained for.

How Banks Make Money

• Unusual practices are concealed from the public: Because financial institutions operate in complex structures, some practices are hidden from view.

• Multiple income sources: Banks make money off of loans, spending, and savings accounts. They often do so at the expense of unsuspecting customers.

• Losing out on inflation: By keeping your money in a savings or checking account with low yields, you're losing out on potential returns that could help keep up with inflation.

Conclusion

Understanding how banks make money and what they don't want us to know is essential to making informed decisions about our finances. By being aware of these truths about money and how banks operate, we can take steps to protect our wealth and avoid falling victim to costly practices.

Credit Cards, Banks and You

In this section, the speaker talks about credit cards and how they can be useful but also dangerous if not used properly. They also discuss how banks use your money to make more money for themselves through fractional reserve banking.

Credit Card Debt

• Credit cards are a useful service that provides convenience for most of us.

• Care should be taken so as not to accumulate debts that could lead to financial difficulties.

• Be sure to pay off your debts every single month.

Fractional Reserve Banking

• Your money in the bank is not physical; it's merely figures and electronic records.

• Banks use your money to do business by giving out loans and mortgages.

• This policy is called fractional reserve banking.

• If everyone wants their money at the same time, no one gets it because the physical cash will not be there.

Bankers Are Not Your Friends

In this section, the speaker warns against trusting bankers too much. They explain how bankers may act friendly towards you but are only interested in making profits for their banks.

Banker Friendships

• Bankers may act like friends by remembering your birthdays and celebrating anniversaries with you.

• However, they are simply playing out a well-rehearsed script waiting for the right time to strike.

• Bankers have targets from their managers and supervisors; they don't meet these targets in record time; they lose their job.

Loan Blackmail

• Some bankers talk customers into taking loans they didn't even plan for.

• Don't allow yourself to be blackmailed emotionally with fake friendship before signing up for any loan make sure it's what you need and want to do it.

Foreign Transaction Fees & Checking Accounts

In this section, the speaker discusses how banks make money through foreign transaction fees and reminds us to check our bank accounts regularly.

Foreign Transaction Fees

• When you travel outside the U.S and make purchases with your credit or debit card, you will have additional charges.

• Most banks won't disclose all of this to you because if you knew, you could dump them and go for other money options.

• Some credit card programs have coverage in some countries outside of the US; in this case, there will be no additional charges on your purchases.

Checking Accounts

• Your bank account is an essential part of your life so don't be too busy or too lazy to check it regularly.

Banks and Financial Activities

This section discusses the legal obligations of banks to credit money back to customers, as well as their requirement to report any suspicious financial activity to the IRS.

Legal Protection for Depositors

• Banks are legally obligated to credit your money back to you.

• Customers can stick to their guns if banks try to delay or avoid this process.

Monitoring of Financial Activities

• Banks keep track of all financial activities.

• Suspicious financial activity is reported by banks to the IRS.

• The policy was put in place to check shady deals such as money laundering.

• A depositor withdrawal that exceeds ten thousand dollars is reported to the IRS.

Auditing of Accounts

• If there is a need for an audit, the IRS will come up with inquiries demanding an explanation for such transactions.

• Officials would like to know if taxes were paid on the funds and if transactions were legally carried out.

Being Watched by Banks

This section emphasizes that individuals should be aware that their financial activities are being monitored by banks and provides tips on how they can stay clean and out of trouble.

Tips for Staying Clean

• Individuals should be aware that they are being watched by banks.

• Knowing this fact could help them stay clean and out of trouble.

Videos on Personal Finance

• Viewers can watch videos on personal finance topics such as "The Formula Millions Have Used To Become Rich" and "Habits That Will Make You Rich."

Conclusion

This section concludes the video and encourages viewers to subscribe for more content like this.

Final Thoughts

• The video concludes with a reminder for viewers who enjoyed it to give it a thumbs up and subscribe for more content like this.