I read this piece of news recently and it makes me go what the………
At my age, it is our responsibilities to have some money for rainy days, college fees and later on, university fees. So, we have to keep some of these money in the bank. It is very depressing that the interest rates keep dropping and dropping. Each month, we are getting less and less returns from our fixed deposits. Yet, it is risky to invest money in other ways because investing means risk and risk means losing it all if something goes wrong.
So, can you see how ridiculous if one day, the banks no longer wants to keep money and ask us to pay them for the safekeeping of our money? Then, we have to revert back to the times when we do not have banks. My mother told me my grandmother and grandfather (who used to be very rich) kept money under their pillows and gold sewn into their clothes. During the Japanese invasion, our colonial money no longer worth anything because they have the banana tree Japanese money or something like that.
The only valuable things were gold. Land was useless too because you cannot bring your land and run.
Now, back to the banks…..
According to Malaysian Insider…..
It is a similar story in many other countries. The reason? Central banks around the world are trying to stimulate flat-lining economies by offering ultra-cheap credit. But the low interest rates for borrowers translate to low interest rates for depositors too.
According to OCBC Bank economist Selena Ling: â€œGovernments want to kick-start lending after the credit crunch. They also want to stimulate the economy.â€
The US Federal Reserveâ€™s key interest rate is now between 0 per cent and 0.25 per cent while the Bank of England has now cut rates to 0.5 per cent.
In Britain, with some accounts paying just 0.13 per cent on some types of accounts, rates are now possibly the lowest on record. Many savers are having to come to terms with the fact that low interest rates are here to stay.
In Britain, Andrew Barker, Skipton Financial Servicesâ€™ chief operating officer, was quoted by The Daily Telegraph as saying: â€œMost now realise that this is unlikely to be a temporary blip, and it will be a year or more before savings rates are likely to rise.â€
In fact, some financial experts are even warning that the next trend will be for savers to actually start paying banks for the service of holding their cash.
I hope our money does not turn into banana tree money one day. Moral of the story, stop bothering to make too much money. Pause and smell the roses.
I also read that our EPF dividend for 2008 may be only 4.5%. According to Malaysiakini, It’s bad news for Employees Provident Fund (EPF) contributors – the dividend is expected to be as low as 4.5% for 2008. They used to pay 8% when I was working. I too have quite a tidy sum tied down in EPF as I worked since I was 17 years old. I can only withdraw some of the money when I reach 50 years old, which is another 6 years. I wonder what the interest rates will be when I reach that age? Perhaps EPF said we must pay them for admin charges instead?
Come to think of it, at least I am not filthy rich. Hence, I don’t lose that much. Hahaha.
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