Pocket finances. Put your money to work today.

If you have your money in the bank without providing any kind of interest, I'm sorry but I don't understand you. That money that has cost you so much work to earn is losing value every day that passes. Every second, in fact, if we go into drama mode (drama queen, yes I am).

I respect that you may not want to venture into the world of stocks or index funds.In fact, in my opinion, if you don't want to educate yourself even a little, it's better that way. But with the opportunities available today in terms of interest-bearing accounts, I won't forgive you for not putting your money to work right away. In this post, I'll tell you about the best market opportunities to remedy this.

Inflation is a tax without legislation.

Milton Friedman

The damned inflation

First, I want you to understand why your money loses value if you don't generate any interest with it and keep it in the bank like someone who used to keep their savings under the mattress. I won't even get into issues of maintenance and account management fees charged by banks. I hope and wish that you have reviewed the conditions so that you are not charged anything for keeping your money. If not, the first task I'm going to give you is to find a bank that doesn't charge you fees or meet the conditions for it not to do so. It could be a spending of X with their card or maintaining a minimum balance in your account. It should be easy to meet, if not thank you, next as Ariana Grande said.

Once you are clear that you won't be charged maintenance fees for your account every quarter, let's see why that's not enough. Do you remember how much a coffee used to cost 20 years ago?Okay, let me help you remember. A coffee could easily cost you 80 cents. Nowadays, for less than €1.2 (and that's being very conservative), you won't even get the cup. That's a 50% increase. I'm not even talking about specialty coffees, that's a luxury. But what a delicious luxury, oh my...

Anyway, with the same amount of money, today you buy much less than you did 20 years ago. And without being a psychic, I can assure you that the same will happen with what we'll be able to buy in 2045. So, if we leave the money in the bank without generating any interest, those coffees that we won't be able to have in the future. That's called inflation. The rise in prices and the loss of value of money.

For the interest I love you

In order to fight against inevitable inflation, we must ally ourselves with interest. And if it's compounded, even better. The difference betweensimple and compound interest simple and compound interest is easy. With simple interest, interest is calculated only on the initial deposited amount. With compound interest, interest is calculated on the initial amount to which accumulated interests are added. So, you get more interest each time, and the amount keeps growing. It's known as the snowball effect..

Today, there is a lot of competition to attract the savings of the population. Competition among banks works in your favor to get attractive offers of interest-bearing accounts This is doubly attractive. First, they pay us for having our money in the bank in question, so we have help against the aforementioned inflation. Secondly, you can access your money at any time. It's a interest-bearing account, not a fixed-term deposit or the purchase of an index fund.

The best interest-bearing accounts

As of today, March 2024, in my opinion, the best interest-bearing accounts are:

1. Interest-bearing account in Trade Bank. This German bank offers a 4% (yes, you read that right!) interest for the first year, for a maximum balance of €50,000. This amounts to €2,000 of interest per year, which they will deposit monthly. That's €166 for free every month. If you don't have €50,000 but have €5,000, they'll pay you the proportional part. From my point of view, it's a great offer.
2. If you still have savings, the interest-bearing account from Evo bankis also great. The 100% online bank from Bankinter offers an interest of 2.85% for a balance of up to €30,000. This means an extra €855 per year. In monthly income, it would be €71.25.
3. Lastly, I would recommend the interest-bearing account from Sabadell Bank. I am delighted with the offers they have been making and with their customer service. Currently, they offer a 2% interest for a maximum balance of €20,000 and a 3% refund on the bills you have domiciled with them. This amounts to €400 of interest in a year, or an income of €33 per month. Plus what you get from the refund of your electricity and gas bills.

If by the time you read this, these offers have become obsolete, I recommend looking for the most recent offers on the web. There are websites that do the work of finding the best offers each month for you. I usually check helpmycash website and save myself the time comparing banks. All the offers I've presented would be compounded interest, because all the interest is deposited into your same account. So, the interest each month is higher.

Let's get to work

As you can see, I include quotes in all my posts, so I'm going to use the well-known one:

Don't put off until tomorrow what you can do today

Benjamin Franklin

I've given you the reason and the tools to get to work. Don't wait any longer and inform yourself today to put your savings to work generating interest. Think of all the coffees you'll be able to treat yourself to with all the money you'll stop losing and start gaining. Have a specialty one leisurely, to my health.

See you soon and happy reading!